operations to developing countries and to reduce their personnel located in rich economies. These actions will help cut company costs because salaries in emerging economies are just a fraction of salaries in developed countries. For example, IBM laid off more than 4,000 US workers in January 2009 and moved these positions to developing economies, including India, China, Brazil, Mexico, the Czech Republic, Russia and South Africa. To reduce negative social effects, the company created “Project Match” in which laid off US workers with strong employment records could be relocated to the countries mentioned above, although with local salaries and employment conditions (McDougall, 2009). Table 4 shows a selected list of offshore services providers from the United States, Europe and India that have reported lay off and hiring activities during the economic crisis.

# **Table 3. Offshore Services Revenues by Provider (percentage compared to the same period in the previous year)**

||Jul-Sep 07 <br>|Oct-Dec 07 <br>|Jan-Mar 08 <br>|Apr-Jun 08 <br>|Jul-Sep 08 <br>|Oct-Dec 08 J<br>|an-Mar 09 A<br><br>Econom|pr-Jun 09 J<br><br>ic Crisis|ul-Sep 09<br>|
|---|---|---|---|---|---|---|---|---|---|
|Accenture|27.0%|18.1%|17.2%|18.9%|17.7%|6.0%|-6.6%|-16.0%|-16.1%|
|IBM|6.6%|9.9%|11.2%|12.8%|4.9%|-6.4%|-11.4%|-13.3%|-6.9%|
|Computer Sciences||||||||||
|Corporation|11.3%|14.3%|10.9%|15.6%|5.5%|-5.0%|-8.3%|-12.1%||
|Automatic Data Processing|13.5%|14.7%|11.8%|10.4%|9.5%|2.5%|-2.2%|-4.5%|-3.6%|
|CapGemini||21.00%||14.4%||0.2%||-12.7%||
|Logica||27.60%||16.3%||-1.0%||-20.1%||
|Affiliated Computer Services|7.8%|5.9%|7.1%|6.2%|7.5%|6.7%|4.4%|5.1%|4.5%|
|Tata Consultancy Services|40.3%|37.4%|30.3%|23.4%|17.1%|0.5%|-5.3%|-4.3%|-3.2%|
|Wipro|55.6%|54.7%|45.8%|41.3%|22.3%|0.2%|-8.4%|-10.5%|-3.7%|
|Infosys Technologies|36.1%|34.9%|33.6%|27.8%|22.2%|9.7%|-0.9%|-4.0%|-6.7%|
|CGI Group|14.6%|15.1%|19.0%|13.1%|3.3%|-9.6%|-17.8%|-13.6%||
|Hewitt Associates|5.6%|9.8%|7.6%|7.0%|7.3%|-3.1%|-3.5%|-6.4%||
|HCL Infosystems|26.6%|27.7%|13.6%|-5.5%|-8.8%|-21.9%|-19.8%|-9.5%|-10.9%|
|Cognizant Technology<br>Solutions|48.0%|41.4%|39.7%|32.7%|31.5%|25.5%|16.0%|13.3%|16.2%|
|Convergys Corporation|0.1%|-0.9%|-0.5%|-2.5%|-3.9%|-1.4%|-3.0%|-1.0%|13.2%|

Source: CGGC, Duke University based on OneSource, Hoovers, companies’ websites and annual reports.

The hiring and lay off activities reported in Table 4 include changes implemented at the global level; however, hiring trends have been concentrated in the developing countries, with most retrenchments and lay-offs occurring in developed economies. For example, Accenture announced they will hire 8,000 people in India during 2010, and Wipro added 3,500 workers in India and the Philippines between 2008 and 2009. Genpact hired almost 3,000 people in Guatemala, South Africa, Philippines, Romania, Morocco, India and Poland during 2009, and the company is planning to hire an additional 10,000 workers in early 2010. On the other hand, in November 2009, Logica, the British offshore services company, laid off 2,200 of their 40,000 labor force during 2008, all of the retrenched workers were based in the United Kingdom. Some of the growth effects noted for these leading companies reflect the acquisition of a large number of small companies, absorbing additional employees. This consolidation is one of the main effects of the economic crisis and is expected to continue within 2010.

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