National study shows robust U.S. IT industry despite offshoring

National study shows robust U.S. IT industry despite offshoring

BY KATHERINE MANUEL
Special to the Rice News

A recent study released by the Association of Computing Machinery shows a robust information technology (IT) industry in the U.S., despite IT jobs being moved to workers in other countries, also called “offshoring.”

Moshe Vardi

The study confirmed the U.S. now has more IT jobs available than at the height of the dot-com boom and the IT industry will be among the fastest-growing over the next decade. However, the U.S. already faces intensifying global competition for higher-skill-level jobs and, according to the study, must “foster innovation” to keep its current edge.

Moshe Vardi, the Karen Ostrum George Professor in Computational Engineering and professor of computer science, co-chaired the study.

“The key message of the study is that the fear that offshoring will ‘suck away’ all IT jobs in developed countries has so far shown to be unfounded,” he said. “At the same time, software has become a truly global market. To be successful in software requires being able to compete globally.”

The goal of the yearlong study was to explain the causes and effects of the globalization of software development and research.

The study cited the creation of low-cost and high-bandwidth telecommunications, the standardization of software platforms and business applications, and worldwide improvements in technology education as forces behind the offshoring trend.

Simply put, businesses can cut costs using offshoring strategies, and many are already doing so. The study found that 30 percent of the world’s largest 1,000 companies currently send work offshore, and that percentage is expected to increase.

Still, the study found that the trend is not as threatening to the U.S. economy as is widely perceived. In fact, only 2-3 percent of IT jobs are lost annually in the U.S. due to offshoring. The study also cited data from the U.S. Bureau of Labor Statistics that shows U.S. IT employment in 2004 was 17 percent higher than in 1999.

The key to remaining competitive in a global economy is to adopt policies “that improve a country’s ability to attract, educate and retain the best IT talent,” the study said. Countries must continue to strengthen educational systems, increase investment in research and development and create government policies that allow the free flow of talent.

“Traditionally, [computer science educators] focused on technical skills, with a particular emphasis on programming,” Vardi said. “We need to consider also nontechnical skills, for example, communication skills, and broaden the curriculum beyond its emphasis on programming.”

Vardi was recently honored with the ACM’s Paris Kanellakis Theory and Practice Award for his contribution to techniques that provide powerful formal verification tools for hardware and software systems. Along with three other scientists, Vardi addressed a key problem in computer science: finding ways to verify that hardware and software designs meet certain specifications. The honorees demonstrated the use of mathematical analysis of formal models to check the correctness of these reactive systems.

—Katherine Manuel is the external relations coordinator and editor for the Department of Computer Science.