Study: Outsourcing could hit jobs in some metro areas

15.02.2007

Although overall "a small share of all U.S. jobs will be lost to service offshoring in the next decade," the report said that some types of service jobs are more likely to go than others, including those that rely heavily on IT and routine or rule-based work.

Some occupations, "especially those in IT or back-office services, could lose up to 24 percent of their jobs in particular metropolitan areas by 2015 as a result of offshoring," the report said. Breaking its results down by occupation, Brookings found that at least 17 percent of computer programming, software engineering and data entry jobs are likely to be offshored [from] certain metro areas."

Areas that appear to be particularly susceptible to IT and back office job losses from offshoring,include Bergen-Passaic, N.J.; Boston; Boulder, Col; Danbury, Conn.; Denver; Hartford, Conn.; Minneapolis, Minn.; Nashua, N.H.; Newark, N.J.; Orange County, San Francisco and San Jose, all in Calif.; Stamford, Conn., and Wilmington, Del.

The message from the report, put together by Robert Atkinson, a senior fellow in economic studies at Brookings and Howard Wial, a senior research associate, is that ofshoring "does require attention and action."

While many service jobs -- especially those enabled by IT -- can be moved offshore, "not every IT-enabled service can be performed anywhere in the world; despite the popularity of the expression, the world is not 'flat,'" according to the report's authors. The authors also cite risks to businesses such as hidden costs, diminished quality of work and contract disputes.