Monday November 28, 2005 
Monday November 28, 2005
Once in a while, I drop by indiadaily.com and see how the outsourcing thing's going along over there :
1. Outsourcing targets smaller cities but finds lack of talent there
India has now lack of talent to fulfill the low priced outsourcing jobs knocking the door of India from the West. The talent pool of high quality is fully employed. The wage inflation is rampant in India. The BPO companies in India are now targeting smaller cities. However, they are finding that the talent pool in smaller cities lack the quality that made the Western companies interested in India. According international think tanks, India may have topped out in its boom in outsourcing.
2. A problem that can kill the concepts of offshore outsourcing from India and China
... here is a problem that can kill outsourcing from India and China. The cost and availability of energy sources will determine the price of outsourcing in the future. The salaries in these countries will have to go higher as these economies are well dependent on crude oil prices and availability. India and China may experience hyperinflation because of higher energy prices. China and India will have to eventually compete with the West in obtaining energy in the form of crude oil and natural gas. It can become real expensive.
- As discussed before, inflation is the thing to watch for, especially wage inflation with the 10-20% annual increases being demanded over *there*. The difference between deflating developed-country wages and inflating developing-country wages is narrowing. And it looks like they have thrown so many warm bodies at this outsourcing industry that they're starting to run out of warm bodies to throw. See, nothing grows forever. There *are* limits to growth. Peak Outsourcing? Another date for the community to ponder over, perhaps.
See also :
1. Indian outsourcing news
2. Calling a Change in the Outsourcing Market
(2005-11-28 12:56:50 SGT)
[Biz]
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