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News (IT Outsourcing in US to increase at 6%)

Outsourcing News, 25 Feb, 2007

NEW YORK: The American IT market report stated that the IT outsourcing is expected to escalate at an annual compound growth rate of around 6%, from 13.3 billion dollars in 2006 to 17.7 billion dollars by 2011.
 
The federal market will have continued shift approaching the contract-operated model rather then government-owned / government-operated. This is fuelled by the impending federal IT workforce shortage, war in Iraq, and federal contract spending slowdown.

The report is prepared by INPUT, helps companies develop federal, state, and local government business. There are around 1,300 members from small specialized, large business companies, and the introducers to the public sector. Based on the report most of them reliance on the outsource firms.  In the future, a significant part of federal technology-related employees is entering retirement age.

To have the best expertise and cost effectiveness of acquiring new technologies quickly, spending in the areas of BPO and application services will contribute the flourishing growth to the federal outsourcing market over the anticipated time.

Improving the federal IT skills is not very promising to meet the objectives, this will require federal agencies to be outsourced more and more mission-critical functions if the contract professionals can do the tasks more proficiently.


And, by the end of the predicated time frame, the federal agencies will have switched to a wholesale preference for smaller outsourcing contracts arrangements. This could be viewed as a total reversal and favorable mega-deal for the outsourcing firms," says Trina Dinavo, senior federal market analyst at INPUT
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