Outsourcing is gaining momentum as technology is getting more advanced. The digital revolution has made a connection for people from around the world easier, but also for businesses to seek employees beyond their countries’ and even the continent’s borders. The internet has made talents more available, and the main reason a business would choose outsourcing is to get better services for less money.
Around 300 thousand jobs are outsourced annually, with more to come as more businesses decide to use outsourcing. These services cost an amount of over $80 billion dollars. Most businesses use outsourcing to reduce costs, and also feel positive about it as their income and profit are also on the rise.
The United States is the biggest outsourcing country along with Canada, comprising 81% of the entire world’s outsourcing contracts. They use these services mainly for their Governmental and Defense needs, while the other continents use outsourcing for their government and telecom services, except Asia-Pacific who uses them only for telecommunication services. The second highest contractor with over 5% in the UK.
A solid 91% of American businesses do use outsourcing. As more than half of the businesses said they are increasing their outsourcing contracts, according to a Deloitte report, some 34% said they restructured their business models to make these services more attainable.
When it comes to IT services, Ukraine seems to be at heads with India for cheap rates. This might be good news for Eastern Europe, so businesses can start focusing their outsourcing in this region.
Overall, businesses said they will use outsourcing again, especially when it comes to IT services, which is the biggest industry for these services. This saves them a lot of money as workers in Eastern Europe request less for their services but outsourcing also allows businesses to focus on their sales strategies. As small businesses are also joining the game, outsourcing is beneficial because they don’t need to invest in staff and equipment.
However, because the services are received from someone beyond physical reach, some businesses have said that the work quality could be better if the employees were more active, as several of them have failed to predict problems. Also, according to Credit Donkey, 80% of companies have said that they won’t outsource their marketing strategies, as they wouldn’t trust an outsider with such a sensitive issue.
Nevertheless, outsourcing positions will be increasing, and soon even high-level jobs will be outsourced as technology is developing. 40% of the banks are already outsourcing their help desk services, as this saves them money and capacities. Payroll management outsourcing saves at least 18% for companies, and this number gets higher depending on the services, as administration, welfare, and health benefits, as well as time and attendance costs, are being cut.