By Tony Hallett, 10 March 2004 16:25
NEWS Ill feeling and a backlash against offshoring will be less likely in the UK if workers and the wider population are educated as to what the shift in employment really means.
While business leaders around much of the world have long recognised the benefits - not just in terms of cost - of sourcing services as well as products or materials in other countries, the overwhelming perception is of countries such as the UK and the US 'shipping jobs overseas' to boost profit margins.
"Research into consumers' attitudes shows 60 per cent aren't only worried about offshoring but about their own jobs," said David Fleming, national secretary of union Amicus, speaking at an event on Tuesday evening run by silicon.com contributors ELA entitled 'The truth about offshore outsourcing'.
He said that the UK shouldn't look to "US-style protection" but is concerned that job losses could be bigger than some research, such as that undertaken by Evalueserve recently and sponsored by Indian industry association Nasscom, suggests.
Malcolm McKinnon, leader of the Europe and World Trade Group at the Department of Trade and Industry, said the government is "doing a serious amount of analysis" into the effects on the UK of offshoring.
But while genuine concerns about service-sector job losses will persist - understandably so - frank discussion of offshoring is now turning to something that the debate and industry has long lacked: openness.
Sunil Mehta, Nasscom VP, said: "We should place the issue of job losses into proper perspective. Only 11 per cent of service-sector jobs can be done offsite."
Of course, the fear is that increasingly the best-paid service-sector jobs - in areas such as equities research, IT and health care - will go overseas while the UK is left with plenty of vacancies for more menial work; all at a time when the population is being skilled up before entering the workforce. So only a tenth of jobs can go - but it's the top 10 per cent.
Mark Kobayashi-Hillary, author of Outsourcing to India: The Offshore Advantage, which is launched next week, points out that offshore locations will increasingly move up the value chain. The savings made by using an accountant in India could be far greater than using a call-centre agent. For the local workforce, the career is also more attractive.
The key, as anywhere, is in training. The consensus seems to be focusing on training for those who might lose a services-sector position in the UK and not find new work easily, and training for those in emerging economies in relevant areas.
While there a serious debate is finally emerging on the subject - focusing on societal and psychological as well as business issues - ensuring that training takes place everywhere and in the right way is the longer-term challenge.
Amicus' Fleming added: "We're at the foothills of this one, not at the end of it."
We'll be bringing you the second half of this story tomorrow, for all of us who have encountered sloppy customer care - wherever the person providing the 'service' was.
Comments
There are 3 comments. Join the discussion
1. Harry Stein
Mr. Hallett's article indicates he may be an industry shill when he says: "the key, as anywhere, is in training. The consensus seems to be focusing on training for those who might lose a services-sector position in the UK and not find new work easily, and training for those in emerging economies in relevant areas."
This is the standard and fallacious argument we here George Bush and economists like Robert Reich argue.
First of all, notice that you will never here people like Hallet tell you what the emerging technologies are. That's because there are no high-paying "emerging" technologies (all such technologies are tradable, i.e., can be offshored). The only non-tradable jobs out there are low-paying.
An article on CNN says that in the U.S., a 2001 Labor Department audit found that only 1 in 5 who participated in programs for displaced workers found jobs for which they had been retrained -- nearly 40% ended up working part time or for less than they had earned before; 28% had not yet found any work at the end of their training.
So, Mr. Hallet, thank you for telling me I need to retrain and have a 1/5 chance of getting a far lower-paying job (compared to what I was making before) -- if I am lucky, it won't be in an area that also can be offshored. In the meantime, my mortgage payment is fixed, so do you have a solution for the fact that once I do get this lower-paying job my income will be halved (or worse) but my mortgage payment won't?
Thanks,
Harry
2. Kevan Chippindall-Higgin
I am currently in a legal battle with my ex accountants. They took the best part of four months to complete accounts and I ended up with not one but two fines as a result.
I wanted to knock the amounts off the bill plus a further £100 for damages (one of the fines was for Companies House and would look bad on a credit check). A judge will look at the matter in due course.
The idea of an Indian doing he work appeals. They will be far cheaper and could not do the work any worse.
Incidentally, this last lot are my third set. The first lot made a mess of capital allowances and then had the gall to say it would all come out int he wash when the asset was sold, while the second lot gave me some seriously terrible advice.
I am now attending all the Inland Revenue courses and doing it myself. At least in future, if I do retain anybody again, I will be able to keep a close, well informed eye on them.
If accountants are going to lose busienss to India, good! They will have to learn to offer a better service and keener prices in order to compete, and that is fine by me.
3. Mohan
Offshoring Training is already here; check out the Offshoring 101 courses at http://www.offshoringmanagement.com/offshoring101.htm