Behind The Numbers: Outsourcing Hurts Employee Morale

Just mentioning the word outsourcing is enough to make some IT professionals break into a sweat. So it's not surprising that outsourcing is impacting workplace morale.

Sixty-one percent of the 12,158 IT pros who participated in InformationWeek Research's 2005 National IT Salary Survey say outsourcing causes lower employee morale. Nearly seven in 10 say outsourcing results in fewer IT jobs being available; 42% say it means fewer opportunities for advancement; and 53% say new hires receive reduced salaries because of outsourcing.

For some IT pros, outsourcing is a fact of life. Nearly one in five say it's an important aspect of global growth, making it a necessary part of business operations.

As for the amount of outsourcing going on, 20% say their companies outsource to U.S. firms and 14% say IT jobs are outsourced offshore. Sixteen percent report their companies outsource IT work to a combination of U.S. and offshore firms.

Still, outsourcing--or the fear of it--doesn't seem to be inducing widespread job-security jitters. Of the 6,008 managers who participated in the survey, only 11% say they aren't secure in their jobs. Forty-three percent say they're somewhat secure, and 46% say they're very secure.

Perhaps keeping the mind busy keeps worries at bay. Ninety percent of IT managers say they're challenged or somewhat challenged intellectually with the IT projects on which they work. Only 10% say they don't feel at all challenged. Among IT staff, 17% say they don't feel intellectually challenged at all.

What's your company doing to keep employee morale strong, and how is outsourcing explained when your company reveals these arrangements to workers?

Marianne Kolbasuk McGee Senior Editor

Employee Centric

Is your company more focused on employee retention compared with a year ago?

Some IT professionals believe that employers are working harder this year to keep technology talent. Forty percent of the IT managers we surveyed say their companies are more focused on employee retention than a year ago. The rest don't think their employers are trying any harder to keep personnel now than last year.

Job Stability

How would you rate your present job security?

IT managers in the 2005 National IT Salary Survey research study feel more secure about their jobs than staffers do. Only 38% of IT staff feel very secure in their present positions. Most--47%--say they're somewhat secure. Things are uncertain for 15%, who describe themselves as insecure. Slightly more than half of IT managers feel either somewhat secure or insecure about their present jobs.

Outside Ventures

Is your company outsourcing IT jobs?

Increased outsourcing of IT work may result in fewer opportunities for advancement and less value placed on IT skills. Yet not all IT professionals are being confronted with outsourcing in the workplace. Of the 12,158 IT pros surveyed in InformationWeek Research's 2005 National IT Salary Survey, 45% say their companies aren't outsourcing any IT, either onshore or offshore.

Mind Games

Are you being intellectually challenged by the IT projects you're working on?

The talent of IT staff members isn't being put to the test like that of managers. Seventeen percent of IT staff say they don't feel intellectually challenged by their current IT projects. Half of the study's 6,150 tech staffers report being somewhat challenged. Only 33% say current tasks are intellectually stimulating. This is far less than the 47% of tech managers who are mentally challenged by their jobs.