Report, Diminishing, Outsourcing
Cost advantage of outsourcing diminishing: Report
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The advantages of outsourcing from the US to cheap brainpower nations like India have been diminishing because the wage gap between America and Asia is shrinking, a media report has said.
"The wage gap between the US and Asia is shrinking. Pay scales are rising fast in India and China for college educated, English-speaking professionals," the Business Week said.The weekly says that the reports that General Electric (GE) plans to sell its entire business-processing operation in India for USD one billion raises the "interesting question of whether the offshoring phenomenon may be peaking."
"Not that it will stop being a key part of corporations' global strategy. In an integrated business world, you go where the best talent is. But the surge in companies going to India, China and eastern Europe in search of very cheap brainpower may soon be coming to an end — far sooner than anyone has anticipated," the report said.
The business weekly wrote: "since these Indians and Chinese aren't anyone's fools, they've been demanding — and getting — increasingly higher compensation. After all, these web-savvy men and women just have to check the human-resources websites of eastern companies to see what their counterparts are making. And indeed they have, as their rising compensation proves."
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