Outsourcing To Podunk: Keeping Jobs Within The Borders
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If you have recently made a phone call to a company's customer care contact center or a computer manufacturer's technical support department, you have most likely had the "pleasure" of learning about outsourcing for yourself.
Despite the incredible inefficiency of non-native English speakers working in tech support, corporate management throughout the United States believes that the money saved on wages by outsourcing positions to Southeast Asia compensates the resulting decrease in overall customer satisfaction scores.
According to Forrester Research, by 2015, at least 3.3 million white-collar jobs worth $136 billion in pay earnings would be outsourced to countries other than the United States.
In a time when US customers expect lower pricing for products and services while simultaneously desiring higher and better pay, corporate America finds itself squeezed. and is looking for a solution outside of the country's boundaries. Consider the possibility that an answer exists closer to home — say, in Arkansas.
Outsourcing to rural America may be a win-win solution to the growing dilemma of rising wages and the increasing demand for lower-cost items in the global marketplace.
Because the cost of living in rural parts of the United States is up to one-third cheaper than in big urban areas such as San Francisco or New York, incomes are lower and talent is more plentiful than in major metropolitan areas.
IT wages in rural America might be as much as 40% lower than those in big metropolitan regions, although this is mitigated by reduced living expenses in rural locations.
The delegation of customer service and information technology tasks to underemployed employees in places like North Carolina and New Mexico makes sense.
Are there any particular sorts of employment that might be excellent candidates for rural outsourcing?
Most information technology roles, from software engineers to project managers, as well as most employment with a home-based component, may be relocated to rural America.
Customer service centers are being relocated farther out from metropolitan regions in order to take advantage of the available labor and native English speakers in the surrounding area.
It is possible to outsource inside borders, which opens up more alternatives for executives and managers who prefer to relocate away from the metropolitan lifestyle and into smaller communities that provide a safer atmosphere with less stress.
Taking a work in a rural region may result in a 20 percent salary drop, but the lower cost of living generally more than covers the reduction in income and may even result in a reduction in expenditures such as petrol and food prices.
It makes sense to look at small-town options, which, although they may not have as many chances accessible as large metropolitan regions, have the advantage of having far less competition on the upside.
In one case, the McKesson Corporation, a prominent pharmaceutical distributor, moved its principal data center from San Francisco to Iowa, resulting in an estimated $10 million in annual wage savings.
Aside from the economic savings associated with working from home, there are several additional advantages to doing so, including favorable time zone gaps, cultural understanding, a shared language, and the preservation of the tax base.
It is also important to recognize the political and economic advantages of this initiative. Tax breaks were granted by the city of Nashville, Tennessee, to Dell Computer to encourage the company to establish a manufacturing and customer service facility in the city.
Rural Sourcing, Inc. , based in Jonesboro, Arkansas, is preserving white collar employment in communities such as Greenville, North Carolina, and Dubuque, Iowa by retaining work that would otherwise be outsourced to countries such as China.
For the skilled individuals who have risen from "the sticks" and prefer to remain in their own communities, RSI offers project work, call centers, and other commonly-outsourced tasks.
'Nearly all of the top 10 percent of my high school graduating class have left the region,' explains Jennifer Daly, who grew up in Manchester, Tennessee, a tiny town of around 20,000 people.
We all went to college and received engineering, computer, or teaching degrees, but we were unable to stay at home due to a lack of employment opportunities in our hometown. It's a real shame. "This is a wonderful community in which to raise a family."
Manchester, Tennessee, matches the criteria of the sort of place that RSI seeks for new sites — a community with a huge pool of accessible talent, close proximity to significant colleges, a cheap cost of living, and a strong educational system.
Similarly sized small towns suffer from "brain drain," which occurs when young professional individuals with new degrees are unable to stay "at home," and instead must relocate to other cities in order to find work.
The dot-com boom sent Jack Allen, an information technology executive from Perry, Georgia to Austin, Texas, where he stayed until the bubble broke, when he returned to his hometown.
To go to his new job in McDonough, Georgia, he now has to drive an hour each way each day. "I would want to raise my children in a small town." "It's a lot more peaceful and secure here."
With the post-9/11 age of urban flight in full swing, bringing white collar employment to small town America is becoming an increasingly popular practice.
Professionals in rural regions have the same level of education as their urban counterparts, but they are not burdened with the high prices of housing and other necessities of life as urban professionals are.
Bringing work to them that would otherwise be outsourced to India, Malaysia, or Pakistan is beneficial to everyone in terms of cost savings and improved customer service for all parties.