Boom at the Expense of Others

Over the last 5 years, the Philippines has grown to become one of the biggest operators of call center businesses. The United States has lost an estimated 250,000 call center jobs as a result. Business experts estimate that inn the next few years about 3.3 million service industry jobs, which include call centers, and roughly $136 billion in wages, will move to countries like India, Russia, China and the Philippines.

Outsourcing came in vogue when it was no longer financially viable to keep them onshore. Compare paying US$10 per hour to an American worker and US$1 to an Asian worker. This automatically means 90 percent savings for the company.
Overall outsourcing could generate a savings of about 45-55 percent and as the process becomes increasingly organized and structured, far greater benefits are being realized and could potentially add up more to just costs savings. One key benefit is that it accords the companies increased business controls. For example, because the company now acts as the client, they can demand better service. Improvements associated with increased business control includes better planning, higher levels of operational reliability and rapid implementation of new strategies and initiatives. In the long run, these add up to further increase in the productivity and cost savings for the company.

The reality is, outsourcing is causing massive unemployment and it is steadily stripping the United States job market. Since 2000, an estimated 400,000 American service jobs have been moved overseas. Although this figure constitute only to less than 0.4 % of the total workforce of the US, there are strong indications that in the following years the number could dramatically go up. If the trend holds, it is projected that by 2015, 3.3 million American service jobs will be off-shored.

The United States have started to reorganize their employment system in order to absorb the changes brought about by outsourcing. The educational system is also undergoing restructuring to cope with the changing demands of industries. What have been an incredible boom for the Philippines is causing major losses to ordinary workers in other countries. It is something to think about that while we bask in our newfound success, others are still lining up to get new jobs.