Nearshore Americas

Hertz to Outsource IT Service To IBM

Hertz is reportedly bound to lay off more than 250 IT professionals as the U.S. car rental company is outsourcing its IT service to IBM. Hertz says the deal will help it cut costs, free up resources, and focus on its core business.
The move comes at the same time that the United States is creating fewer technology jobs. According to Computer World,  the nation added just 5,500 IT jobs in January this year, down from 6,100 it added in December of 2015.
Most of the rental car company’s information technology operations arebased in Oklahoma City, and providing system support is the main job of its IT staff. IBM will take on some of the employees being fired, and Hertz says it will offer severance packages and assist others in finding new positions.
Hertz has long been talking of trimming its IT unit. The company believes that it has employed more people than it needed at its call centers. There are about 1,500 people working at its back offices.
According to Computer World, IBM’s Indian subsidiary has filed paperwork for numerous H-1B workers for a property in Oklahoma City. The property belongs to Hertz Technologies Inc., a Hertz subsidiary, says the tech magazine while citing government records.
Finding a job is relatively easy for technology professionals in the United States, where unemployment in the sector stands at less than 2.5%t. As almost every company relies more heavily on technology, the tech unemployment rate is likely to keep going down, and certainly not rise, in the years to come.
A survey from accounting firm BDO USA says that the rising cost of maintaining overseas operations is discouraging some domestic tech firms from offshoring, resulting in creating more jobs onshore. Furthermore, employment in all information technology fields is expected to increase by 22% by 2020, according to the U.S. Bureau of Labor Statistics.

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Narayan Ammachchi

News Editor for Nearshore Americas, Narayan Ammachchi is a career journalist with a decade of experience in politics and international business. He works out of his base in the Indian Silicon City of Bangalore.

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