A report from today's Oakland Tribune shows outsourcing cuts both ways.

INFOSYS Technologies, India's second-largest software maker with U.S. headquarters here, said it is investing $20 million to create nearly 500 consulting jobs in the United States. The new company, called Infosys Consulting, will be based in Fremont and will provide business consulting to American corporations. The consulting company has already begun 'aggressive hiring in America,' Infosys chief executive officer Nandan Nilekani told reporters Thursday.

....'It's very exciting around here,'" said Lisa Kennedy, a spokeswoman for Infosys in Fremont. 'I've been flooded with resumes already.'

Kennedy said the Fremont-based Infosys Consulting also will have offices in Boston, Dallas and Lake Forest.

The Wall Street Journal reported last month that according to the U.S. Commerce Department:

..the U.S. posted a $53.64 billion surplus last year in trade in private services with the rest of the world.

Global outsourcing is a boon to the U.S. information technology industry and the U.S. economy, according to a recent study released by the Information Technology Association of America. From the study's executive summary:

The benefits of free trade - lower costs, higher labor productivity, and more efficient production - induce businesses to leverage offshore resources....(this)..lowers costs, frees domestic resources to pursue other productive ends, yields high quality software and services, and increases labor productivity among end-users. These benefits flow through to lower prices, lower interest rates, and higher spending throughout the economy.....As the benefits compound over time, the U.S. economy creates more than twice the number of jobs than are displaced, and increases the average wage.

Posted by Matt Rosenberg at April 9, 2004 10:25 AM

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