Ahmedabad: Market research firm IDC has predicted that offshore activities of the US IT industry are set to rise dramatically over the next four years, but the rise may not affect US jobs adversely, as some industry observers fear.

According to IDC, US services firms will continue to use offshore resources due to lower costs while the majority of US workers at risk will leverage their current expertise into new skills that will remain in demand. IDC reached this conclusion after surveying various IT vendors.

The research firm predicts that the offshore spending component of the US technology services market will rise to 10 per cent of the total spending, or $6.3 billion, in 2003. It also expects offshore spending to more than quadruple to $46 billion, or 23 per cent of the total, by 2007.

The IDC findings come in the wake of a hue and cry in the US over IT outsourcing to locations such as India and China in view of the domestic job losses in these countries. The research group, however, feels that such fears are unfounded. "Infotech jobs will continue to migrate overseas at a faster pace due to lower costs, but much of the work will still be captured by US providers as they beef up their operations abroad."

While the mainstream media has seized upon the threat of offshore sourcing to US jobs, IDC finds that such a dramatic shift may not necessarily translate into a doomed outlook for US IT services jobs or US-based services firms. "Much of the offshore spending will be captured by locally-based vendors, who are currently building up their own offshore delivery resources. But the most important fact being overlooked is that, while there will be a migration of some jobs overseas, it will be coupled with steady growth in a number of service activities on the US soil."