Analyst firm predicts IT outsourcing boom

The worldwide market for business process outsourcing (BPO) will reach £71bn in 2005, up 8% from 2004, analyst firm Gartner has predicted.

In Europe, spending on BPO, which covers IT-intensive business processes such as HR and accounting, will remain strong and is on course to reach £19bn this year, an increase of 6.6% from 2004.

Growth areas for BPO will include procurement and payroll functions, according to Gartner.

The analyst firm said organisations should check that BPO suppliers have enough qualified staff to meet the increased demand. Many new suppliers coming into the market could lack specialist skills, it warned.

Separate Gartner research has predicted that the number of IT jobs outsourced to India, China and other lower-cost countries from the world’s advanced economies will reach 30% by 2015.

Currently less than 5% of IT jobs have gone offshore to cheaper countries from Western Europe and the US.

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