IT outsourcing to reach $31 bn by 2008

Spending on global sourcing of computer software and services will grow at a compounded annual growth rate of 26 per cent, jumping from $10 billion in 2003 to $ 31 billion by 2008, a report by US market research firm Global Insight has said. During this period, the estimated savings from the use of offshore resources is expected to increase from $6.7 billion to $20.9 billion, it said.

The cost savings derived from offshoring are expected to lower inflation, increase productivity and lower interest rates, thus catalysing business and consumer spending and heightening economic activity. The benefits of global sourcing

are contributing to real GDP in the US, adding $33.6 billion in 2003. By 2008, real GDP is expected to be higher than it would be in an environment where offshore it software and services do not occur, Global Insight said. Global IT software and services outsourcing will increase the total employment levels in the US.