Outsourcing work abroad cuts UK pay

The wages of new information technology (IT) support staff have remained stuck at £18,000 over the past five years, while longer serving employees have only seen their pay increase by 0.8% a year, said the Association of Technology Staffing Companies (ATSC).

But salaries for managers have increased by 20% over the last five years to an average of £45,000, the research found.

Low skilled jobs leaving the UK acted as a disincentive for people in the UK to study IT, which could worsen skill shortages in the industry, the report warned.

Ann Swain, chief executive of ATSC, said: "The outsourcing of entry-level IT jobs has meant fewer graduate-level jobs are available in the UK. It is like removing the bottom rung from the career ladder."

"The shortage now is of candidates with a few years' experience looking for second and third jobs. But how do you get that experience if entry-level jobs are being sent offshore?

"Concerns over quality of service and data security in outsourced operations are constantly being voiced. However, these concerns haven't yet prompted organisations to bring their IT support roles back onshore en masse."

The report predicted that a turning point would arise when Indian salaries, currently increasing at more than 14%, came close to those of UK professionals.

"As the gap converges, it will make less and less economic sense to outsource support functions to India," added Ms Swain.