Recruitment companies slam Indian outsourcers

The Association of Professional Staffing Companies has sparked a fierce debate after accusing Indian outsourcing companies of bringing thousands of IT staff from the sub-continent to the UK each year in a move which was “damaging” the job prospects of British workers.

The claims have been rebuffed as an oversimplification of an “emotion-charged” issue where recession hit companies are still cutting thousands of staff posts.

Using Freedom of Information requests, Ann Swain, chief executive APSCO, said Indian outsourcers were bringing foreign workers to the UK on an “industrial scale”. The suppliers should be legally obliged to “tap the UK labour market”, she insisted, before employing overseas staff.

Seven of the top 10 companies bringing non-EU workers into the UK were from India, she said, with Tata Consultancy Services, Infosys and Wipro temporarily importing a total of nearly 10,000 staff in the last year.

But Anthony Miller, managing partner at analyst firm TechMarketView, said the issue was “never as clear cut” as it was being portrayed.

While there was probably “abuse of the [temporary visa] system” by some outsourcing firms, it was not clear how much this was happening or who was responsible, he said.

It was wrong to assume that bringing overseas IT workers to the UK meant British jobs were being lost, he said. “Of course many jobs being offshored could be done by UK staff, but the cost-savings often mean companies can undertake more IT projects to help the business grow, or indeed remain profitable.”

A more informed debate was needed, he said, where the above aspects are considered, as well as the importance of maintaining the development of British IT skills by assuring jobs are available to local staff.

Miller said “there is an obligation on the UK IT industry”, including the UK divisions of Indian outsourcers, “to ensure that we are building sufficient local skills so that we do not become entirely dependent on offshore talent”. Additionally, the government needed to monitor closely any visa abuse.

But the recruitment of British staff by Indian outsourcers was being ignored in the debate, he said. Part of the problem was that Indian outsourcers “haven’t got their act together individually, or more importantly as a group, to get a coherent message out”.

Rather than “toss grenades over the transom”, Miller said, it would “surely make more sense” for both sides of the debate to look for “real clarity on the facts and the detail” to solve the issue.

Some employment regulation is due to change. Temporary workers will soon not be able to stay in the UK after their contract ends, and they will not even be able to enter the country for work if they have not been at their company for over a year.

Phil Woolas, immigration minister, told the Financial Times that “intra-company transfers” were an “important part of making the UK an attractive place in which to do business”. The authorities would take action against employers found to be deliberately undercutting local wages, he said.

Copyright © 2009 IDG Communications, Inc.

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