While the U.S. IT labor market is showing signs of stabilization and modest growth, it has not yet approached the rate of growth reported by India. In the final quarter of 2009, Indian IT companies started adding thousands of employees after a year of relatively flat growth. Three of India's largest IT services firms — Wipro, Infosys Technologies and Tata Consultancy Services — added a total of 16,700 employees in 4Q 2009. The many possible reasons for the upsurge in Indian IT hiring is analyzed in the context of U.S. demand for Indian outsourcing services.
The returning popularity of outsourcing for U.S. firms is one reason for the recent growth in IT hiring in India. When U.S. companies consider whether or not to build out new IT projects, they often turn to outsourcers rather than add or rehire permanent employees. The U.S. IT work force, which peaked at just over four million in November 2008, now stands at just over 3.8 million IT workers. At the same time, the market for outsourcing contracts turned in its best performance in six quarters, reaching a total market value of $24.7 billion in 4Q 2009.
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