The Return Of The Outsourced

While we're looking at the explosion of global capitalism—a welcome contrast to the more worrisome news from the Middle East—here is a particularly important update on the information technology boom in India.

You know India is becoming really successful when companies that have made their fortunes by "outsourcing" work from America to India now find that wages for educated Indian workers have risen so high that they have to outsource the work to other, less prosperous nations.

Even more startling is the fact that some computer programming work is now being outsourced back to the United States, as a way for those with no background in computer programming to get on-the-job training.

"Outsourcing Works, So India Is Exporting Jobs," Anand Giridharadas, New York Times, September 25 Thousands of Indians report to Infosys Technologies' campus here to learn the finer points of programming. Lately, though, packs of foreigners have been roaming the manicured lawns, too.

Many of them are recent American college graduates, and some have even turned down job offers from coveted employers like Google. Instead, they accepted a novel assignment from Infosys, the Indian technology giant: fly here for six months of training, then return home to work in the company's American back offices.

India is outsourcing outsourcing.

One of the constants of the global economy has been companies moving their tasks—and jobs—to India. But rising wages and a stronger currency here, demands for workers who speak languages other than English, and competition from countries looking to emulate India's success as a back office—including China, Morocco and Mexico—are challenging that model….

In May, Tata Consultancy Service, Infosys's Indian rival, announced a new back office in Guadalajara, Mexico; Tata already has 5,000 workers in Brazil, Chile and Uruguay. Cognizant Technology Solutions, with most of its operations in India, has now opened back offices in Phoenix and Shanghai….

In a poetic reflection of outsourcing's new face, Wipro's chairman, Azim Premji, told Wall Street analysts this year that he was considering hubs in Idaho and Virginia, in addition to Georgia, to take advantage of American "states which are less developed." (India's per capita income is less than $1,000 a year.)…

Some analysts compare the strategy to Japanese penetration of auto manufacturing in the United States in the 1970s. Just as the Japanese learned to make cars in America without Japanese workers, Indian vendors are learning to outsource without Indians, said Dennis McGuire, chairman of TPI, a Texas-based outsourcing consultancy….

The American program here in Mysore is meant to keep open that pipeline of diversity.

Most trainees here have no software knowledge. By teaching novices, Infosys saves money and hopes to attract workers who will turn down better-known companies for the chance to learn a new skill.

"It's the equivalent of a bachelor's in computer science in six months," said Melissa Adams, a 22-year-old trainee. Ms. Adams graduated last spring from the University of Washington with a business degree, and rejected Google for Infosys.