IBM And The Rebirth Of Outsourcing (IBM)(INFY)(WIT)

A couple of month ago, India’s chief finance minister may have made calls to the heads of IBM (NYSE: IBM) and several other large US tech companies to tell them that the huge developing nation was hemorrhaging high-end tech jobs. Whether the call happened or not, looking at statistics from India it would be easy to see that the costs of outsourcing technology work to firms based in there is dropping as unemployment in the country rise.

For a number of years, unions and members of Congress spent a great deal of time complaining about the number of US jobs being sent abroad. The bitterness about the issue seems to have receded recently, especially as the recession has deepened and large American companies have been inclined to cut jobs as much or more than they have been able to export them. Perhaps with the economy losing about 600,000 jobs a month, the need for efficiency though outsourcing has become less immediate.

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Other stocks mentioned: Infosys Technologies Ltd. (Nasdaq: INFY), Wipro Ltd. (NYSE: WIT)

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