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Impact of US recession on outsourcing of IT and other services to India
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Posted by : Rahul   Apr 30 2008
Do you think the Impact of US recession on outsourcing of IT and other services to India will be positive?
Do you think the Impact of US recession on outsourcing of IT and other services to India will be positive? Some IT companies have stated that though they have large hiring plans for the year, the numbers are less than what they have been in the last year. Some IT companies which hire aggressively from campus, have also deferred offers. Maybe this is just a very temporary phenomenon. What do you guys think?

Some articles have been mentioning that the impact is likely to be positive. Large number of Fortune 500 companies already outsource services to India. In fact i have recently read a few articles which state that Small and Medium Enterprises in the US which so far have not been outsourcing much, may be forced to consider outsourcing too to remain competitive. This could lead to greater business here for IT and ITES players. As per one of the articles. 'SMEs account for 80% of the US industry in terms of volume. The US currently has around 20,000 small and medium firms in the revenue bracket of $2 million to $500 mn; 6,000 companies in the $500 mn to $2 billion bracket, and another 3,000 in the $2 bn to $5 bn category. The country has around 2,000 firms with revenues of $5 billion and another 1,400 companies in the $5 billion to $10 billion bracket.' Therefore outsourcing by some of them should be positive.

I am a bit confused. Would appreciate more views and insights on this from other members.