Indian IT workers are flooding Britain on temporary permits, undercutting local wages and raising prospects of a homegrown skills shortage, an IT association has claimed.
"Wages are being undercut by companies bringing over Indian workers, who are put up in hostels and paid poorly," Ann Swain, chief executive of the Association for Technology Staffing Companies told the Daily Telegraph.
According to her, salaries for certain IT workers have fallen in recent months.
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Home Office immigration figures show that 21,448 foreign IT workers have been issued work permits this year, an increase of 15 per cent on 2004 and almost double the level five years ago. Of those, 85 per cent now come from India.
Separate research from PayScale, a pay monitoring firm shows that an experienced software programmer in India receives £6,600 a year compared with £33,000 his counterpart in the UK gets.
After paying for heir travel, permits and living expenses, the Indian workers are "charged out to clients at around half the rate asked by an homegrown IT expert (£350 pounds a day against £650)," Elizabeth Gordon-Pugh of outsourcing consultant Alsbridge said.
"One Indian supplier operating in the UK has around 80 per cent of its 2,000 plus staff in the UK comprised of Indians on assignment from a few weeks to several years," the daily quoted her as saying.
ATSCo's research shows that the "commoditisation" of IT services has reduced average salaries for permanent IT helpdesk workers by 3 per cent this year to £17,538 and for temporary workers by 25 per cent to £12 an hour.
Swain cautioned that the trend, known as "onshore offshoring," could lead to a damaging skills shortage.
"How will organisations recruit IT staff for mid-to-senior level roles if there are no entry-level jobs left in the UK? The fall in the number of graduates choosing IT careers will filter through to chronic shortages at the top in years to come," he said.
Echoing her concerns, David Fleming, the Amicus national secretary for finance, who has warned that the UK could be left as a nation of "fat cats and hairdressers, with nothing in between" if the offshoring of back office jobs and manufacturing continues.
Deloitte Consultancy has predicted that 2 million jobs currently based in Western economies will migrate to India by 2008.
According to industry sources, most consulting companies offer some form of "onshore offshoring."
IBM, LogicaCMG, Accenture and CapGemini all transfer Indian workers to the UK for projects, as do Indian consulting firms Tata Consulting Services and Infosys.
One of the real reasons why companies are turning to people from the Indian subcontinent is that UK graduates cannot compete with the quality of India's technology graduates.
"The level of intelligence and attention to detail is lacking in UK staff coming through the education system," an IT expert said.
