Two sides of call center outsourcing and their effects to US employment

Two sides of call center outsourcing and their effects to US employment

OABPO Blog Team Published on March 3, 2014

call-center-outsourcing
Call center outsourcing, or any type of offshoring activity, has positive and negative effects on US employment, according to a research conducted by the University of California, Berkely (UC Berkely) and the Massachusetts Institute of Technology (MIT).

On the good side, outsourcing bolsters the American labor force by generating additional jobs in the mother country. Sending work overseas enables businesses to gain industry expertise and penetrate foreign markets, thus giving way to their expansions both in overall revenues and local manpower count.

call-center-outsourcing--

Its disadvantage, the study said, is that the job sorting only favors workers with high-paying positions, while manual laborers suffer. The research also noted that the majority of companies engaged in outsourcing is under the production sector, which means that subcontracting activities have implications on US manufacturing.

“While offshoring appears to be complementary to US employment in that it is associated with a relative increase in higher-paid jobs, it could be undermining lower-wage jobs,” said UC Berkeley economics professor Clair Brown, one of the researchers behind the study. The professor disclaimed, however, that in their initial study (based on 2010 stats), they didn t estimate how globalization has affected the total number of domestic jobs.

High-cost outsourcing

One of the study’s findings contests one common assumption about outsourcing: nearly the majority of outsourced jobs go to local firms in the United States, and barely a quarter of the total sent-out jobs goes to offshore locations.
A break down of the gathered numbers inferred that:

  • Domestic outsourcing concentrates on IT services, transportation, and facilities maintenance.
  • An average of 6% of business functions of manufacturing companies are outsourced locally, while 10.5% are outsourced abroad.

“The portrait that emerges is of two economies - an entirely domestic one made up of small firms and public organizations, and another one consisting of large firms with much deeper global engagement,” explained MIT’s Tim Sturgeon, coauthor of the research.
Moreover, most of these overseas jobs don t go to low-cost manufacturing, back office, and call center outsourcing destinations like India and China. Instead, they are sent to high-cost countries in Western Europe and to Canada. This trend further fortifies two truths about the practice of outsourcing:

  • Service quality is prioritized over cost efficiency.
  • The belief that offshoring erodes US employment is overblown and unsupported.

The researchers forecasted that the US economy will grow along with outsourcing and offshoring activities. Brown said, “The recovery allows companies to restructure and expand through more offshoring and outsourcing, instead of just rehiring and returning to old practices. This could certainly affect US jobs adversely. We would need to conduct a follow-up survey to understand how companies structure their businesses globally and domestically.”

Open Access BPO uses the best technologies and the reliable communication channels to ensure unhampered call center operations.

Leave a Reply

JOIN US ON FACEBOOK
Open Access BPO
Open Access BPO11 hours ago
#CallCenters must understand their customers' unique communication styles so they can assist them more effectively. Here are 4 typical communication patterns among customers and some tips on how to handle them: https://buff.ly/39w7ybm

----------
Open Access BPO knows your customers. For proactive #CustomerSupport, contact us: OpenAccessBPO.com/get-started

#WeSpeakYourLanguage
#CustomerService
Open Access BPO
Open Access BPO17 hours ago
#CallCenter leaders play a central role in helping campaigns grow. Team leaders especially are responsible for the progress and the quality of service that #CustomerSupport agents provide the brand's customers.

Here are the 5 biggest enemies of great leadership (and a few tips on how to be a good leader): https://buff.ly/3M5iMC0

Find great call center agents and team leaders to manage your brand's growth when you partner with Open Access BPO: OpenAccessBPO.com/get-started

#WeSpeakYourLanguage
Open Access BPO
Open Access BPO1 day ago
Personalized solutions empower brands to provide high-quality support to their customers and their growing needs.
With the help of a capable #CallCenter, you can be sure these areas are being covered: https://buff.ly/3sCjnTS

----------
Build your hyper-customizable #CustomerSupport, #BackOffice, or knowledge-based support program with Open Access BPO: OpenAccessBPO.com/get-started

#WeSpeakYourLanguage
#CustomerSupport
Open Access BPO
Open Access BPO2 days ago
With multilingual support comes multiple business growth opportunities. The best way to get aboard the globalization train is to partner with a multilingual #CallCenter: https://buff.ly/3Mmfkms

----------
Open Access BPO's services support over 30 languages. Contact us today: OpenAccessBPO.com/get-started

#WeSpeakYourLanguage
#MultilingualCallCenter
Open Access BPO
Open Access BPO4 days ago
It’s Data Privacy Awareness Month at Open Access BPO!
For our first Weekend Link Roundup, we’re featuring posts about #DataSecurity and #InformationSecurity best practices: https://buff.ly/3weIWMU

Is Data Safe From Security-Related Outsourcing Issues?
https://buff.ly/38tH5uD

Best Practices to Boost Data Security in Call Centers
https://buff.ly/3sAEsya

Educating Your Customers About Information Security
https://buff.ly/3sAEsya

The Worst Threat to Business Data Security: Employees
https://buff.ly/38lgjF3

Deflecting Insider Threats to Data Security
https://buff.ly/3yC5mt5

How Open Access BPO Future-Proofs Your Offshore Operations
https://buff.ly/3wmGuEx

----------
Learn more about smart, secure, and scalable #outsourcing over at OpenAccessBPO.com

#WeSpeakYourLanguage
#DataPrivacy
Open Access BPO
Open Access BPO4 days ago
Having a branded #CustomerService strategy sets your business apart from others, helping grow your customers base and enhancing #CustomerExperience.

Here's how you can develop a branded customer service strategy: https://buff.ly/3L7FrMz

----------
Outsource #CustomerDelight without losing your #BrandIdentity: OpenAccessBPO.com/get-started

#WeSpeakYourLanguage
#CustomerSupport #branding
Open Access BPO