Last year's Forrester report made Americans sit up at the prospect of losing 3.3 million jobs to low-cost destinations by 2015. Last week, another Forrester report, Users Offshore Evolution and Its Governance, said that 60% of Fortune 1000 companies are yet to offshore.

He said 50-60% of the 1000 are bystanders, 25-30% are experimenters, and 5-10% committed. Less than 5% are benefitting from the offshoring. Forrester analysts termed offshoring as a fad.

The truth lies somewhere in between. Dell recalled some IT help desk work after complaints on service quality. Last week, Lehman Brothers recalled similar work it had offshored to Wipro. The Indiana state government's cancellation of a $15-million IT contract to Tata Consultancy Services was ostensibly because "it was not fair to use taxpayers' money to pay foreign workers". In other US states, too, politicians want to ban awarding contracts to firms employing foreigners. At the same time, IBM is planning to move 4,730 jobs to India and China and Siemens proposes to offshore 10,000 jobs.

IT Association of America president Harris Miller says offshore locations have just 3-4% of US firms' outsourcing business despite it being a win-win proposition. McKinsey and Company says that for every dollar of offshoring, the US gets $1.12-1.14, while the vendor nation benefits from new jobs.

Miller sees offshoring growing, but warns: "With US elections in 2004, there could be a backlash." A few firms might bow to pressure to recall work, but the back office will continue to buzz.