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Outsourcing to usurp more U.S. jobs

One out of every 10 jobs at American technology and services companies will move overseas by the end of next year, according to research firm Gartner.

More U.S. jobs at American technology and services companies will flow to developing countries, as offshore outsourcing becomes an attractive financial option, according to Gartner.

A study released by the research firm on Tuesday states that one out of every 10 jobs at information technology companies and at companies that provide IT services will move to emerging markets. It also forecast that one out of every 20 jobs within internal IT departments will shift overseas by the end of 2004.

"Offshore outsourcing is becoming a tool for improving service delivery and a source of highly qualified talent in greater numbers," Diane Morello, a research director at Gartner, said in a statement.

American technology companies are increasingly shifting part of their research efforts to countries such as India, Ireland and China. They are lured there by large numbers of highly trained software and hardware engineers and by lower development costs.

But the migration of technology jobs to countries like India has raised the hackles of many workers and politicians in the United States.

The Gartner study cautioned that although outsourcing may lead to lower costs, businesses must realize that it could also lead to a loss of talent, intellectual property and overall organizational performance.

Microsoft, one of the many companies that have recently announced plans to shift jobs overseas, seems already to have considered this drawback. On Monday, Chairman Bill Gates said: "We will always have the vast majority of our (major) software development here (in the United States). We're not about, 'Can we do the next version of Windows for 5 percent less?'"

Gartner advised chief information officers in U.S. companies to devise well-thought-out outsourcing strategies that could lead to new competencies in areas such as service management and business integration. However, it also suggested that they move some day-to-day activities overseas.