West to outsource 4.1 mn jobs by '08

Washington, July 14: The number of service jobs outsourced from the industrialised world to low-wage countries is expected to surge to 4.1 million by 2008, according to a study.

But the authors of the report argue the trend will have only a small effect on workers in wealthy nations because it will affect a relatively modest percentage of the workforce.

"Labour markets in developed economies are experiencing and will continue to experience the trend toward offshoring as a slow, evolutionary change," said the report by the McKinsey Global Insbreastute, released at a Washington forum at the Insbreastute for International Economics yesterday.

"It will have less impact on patterns of employment than the decline in manufacturing employment developed economies have experienced recently."

Still, the study underscored the inexorable shift of many jobs -- especially in sectors like engineering and computer jobs -- from the US and Europe 'to countries like India, China and the Philippines.

"These are very profound changes that will alter the (global) labour market dramatically," said McKinsey's Diana Farrell, main author of the report.

"But they will not happen overnight."

McKinsey estimated that about 1.5 million service jobs were outsourced from rich countries to the developing world by the end of 2003. Still, this is only a fraction of the "potential" 160 million jobs that "could be done by people located anywhere in the world" -- about 11 per cent of the global service workforce.