Area Development Homepage >> Site Selection/Facility Planning >>

U.S. Call Center/Back Office Operations Regaining Lost Ground

The United States is uniquely positioned to gain back the jobs in this now more knowledge-based sector that have been lost over the last decade.

King R. White, Founder and President, Site Selection Group (Spring 2011)

(page 2 of 2)

Wage Inflation: Wage rates in mature markets such as India, the Philippines, Costa Rica, Guatemala, and Jamaica are increasing by 7-10 percent per year as compared to 2-3 percent in the United States. Wages have doubled in most of these markets over the last decade.

Employee turnover: The annual employee turnover rates within these countries have increased from 10-20 percent in the early 2000s to more than 70-80 percent today. Training expenses have also increased and employee quality has diminished.

Currency valuation: The weakened valuation of the U.S. dollar has affected near-shore locations like Canada and has impacted the savings opportunities in near-shore and offshore markets.

Availability of qualified English-speaking workers: As the markets have matured, the fast pace of the industry's growth, combined with escalating employee turnover rates, has caused labor demand to exceed supply in almost all offshore markets. Wage wars will develop and training costs will increase further as companies are forced to compete for qualified labor.

3. Consumer, political, and business continuity pressure - There are outside forces that continue to put a dark cloud over the long-term viability of many near-shore and offshore markets. Among the factors presenting greater risk for corporations considering offshore and near-shore strategies are the following:

Enlarge This Image

Chart A: Identifies the top 10 deals (in terms of employment numbers) announced in the call center/back office sector in 2010 by category. click 'enlarge' to open full chart.

Enlarge This Image

Chart B: There’s been increasing growth in true professional service functions requiring specialty degrees and licenses for activities such as legal, clinical healthcare, financial services, research/analysis, and risk management, chart B illustrates

Editors Picks

Consumer pressure: Americans are completely fed up with the quality of offshore call centers. Consumers demand quality and corporations want customer loyalty. Offshore locations cannot satisfy both of these objectives.

Political pressure: Local, state, and federal governments are pressuring corporations to create jobs in the United States. The federal government has tried to pass legislation to hamper offshoring, while state and local governments are trying harder than ever to attract call center/back office operations.

Business continuity risk: There are three core business continuity risks that continue to plague the offshore and near-shore markets - terrorism, political stability, and weather. Many markets present one or more of these risks, which impact a corporation's ability to locate in certain regions of the world.

Call center/back office jobs have become a staple of the white-collar U.S. work force. It is critical that U.S. governments support the industry's growth and diversification as the nation is uniquely positioned to gain market share lost over the last decade.

<< Back Page1 2

Save/Share Article

About the Author

King R. White, Founder and President, Site Selection Group
King R. White is founder and president of Site Selection Group. Leveraging more than 11 years of experience in the site selection and real estate industries, White founded Site Selection Group to provide comprehensive global location strategies to corporations and communities. Prior to the formation of his own firm, White was a principal and founder of the Corporate Site Selection Group of Trammell Crow Company, where he and his team provided strategic location consulting for projects such as: back-office, call centers, data centers, distribution centers, headquarters, and manufacturing and R&D operations. During his tenure, White consistently was a top producer and completed more than 400 site selection projects for leading corporations, such as Alltel Communications, Amazon.com, American Express, The Home Depot, Progressive Insurance, Sprint, and Washington Mutual Bank.

ASK AREA DEVELOPMENT

Have questions, comments or concerns about this article? Submit to Ask Area Development here and the author or an expert from our network of site selection and facility planning professionals will answer:

Privacy policy / GuidelinesArea Development will select a number of questions to answer each week. An Area Development representative will contact the submitting reader directly with feedback. Additionally, all submissions are eligible to appear online or in our print publication. If your question is selected for publication we will include and publish your first name, job title and industry only. The full identity of the submitting reader will not appear in published format.Area Development will not publish, share with any third parties, or use for marketing purposes any personal information submitted here without the express consent of the submitting reader.

News Items

Around The Web

Studies/Research

News Items

Around The Web

Studies/Research

Chile-based Crystal Lagoons To Open Headquarters In Miami, Florida

State Resource map

Click on any state for links to current state news and data, contact directory, corporate taxes, financial and business incentives, credits, grants and available buildings and sites

State Resource Sponsor