NPR
Outsourced Call Centers Return, To U.S. Homes
by Carolyn Beeler
August 25, 2010
Maureen Quigley-Hogan is the next generation of call center worker.
Wearing pink slippers and sitting at her desk in her home office in Virginia, she
takes a call from a woman in New Jersey who has a question about her credit
card bill.
Quigley-Hogan was unemployed for 10 years because she couldn't hold down a
traditional job, she says. She has rheumatoid arthritis and fibromyalgia, a disease
that causes severe fatigue.
"It was hard to get to a job," Quigley-Hogan says. "The idea of going through a
regular schedule of getting up and getting ready for work, I would be exhausted."
She worked in customer service for more than 20 years, so two years ago, she
was thrilled to land this job where she can work from home.
Rethinking Overseas Outsourcing
For years, Americans have had their phone calls about credit card bills and
broken cell phones handled by people in the Philippines or India. But American
firms are starting to bring call centers back to the U.S. — and this time around,
they are hiring more people to work in their own homes.
Ten years ago, it made a lot of sense to outsource these jobs overseas. But
that's changing. Increasingly, companies that want to outsource their customer
service jobs are happy with these domestic arrangements.
High inflation and double-digit annual raises in some sectors are pushing up the
cost of labor in India. At the same time wages in the U.S. are falling and
companies are rethinking the trade-offs associated with outsourcing.
Weighing Costs And Woes
Richard Crespin, director of the Human Resources Outsourcing Association,
says when companies decide whether to outsource overseas they have to weigh
the costs as well as "the inconvenience of having something distant from you and
not close in proximity — what I would call the pain-in-the-neck factor."
He says when wages drop in the company's home economy, those companies
are less likely to outsource these jobs to other countries.
Experts say outsourcing is still accelerating for jobs in IT services and
manufacturing. Phil Fersht, an outsourcing analyst, says even before the
recession started, companies were starting to realize that offshoring wasn't the
best option for other services.
In some cases, workers in India are making only about 15 percent less than
workers in Nebraska, he says. That's the threshold where companies start
thinking about whether it's worth it to hire an American worker instead of a
foreign one.
Thousands Of Home Workers
Home workers, such as Quigley-Hogan, represent one of the cheapest models
for customer service. There are an estimated 60,000 people doing call center
work from home.
"It provides a lower cost point than other traditional means of onshore customer
service," says Chris Carrington, who runs Alpine Access, the Denver-based
company that Quigley-Hogan works for. Carrington says the low overhead of
having home-based workers allows him to charge 20 percent less for the same
services provided by brick-and-mortar call centers in the U.S.
"We don't have big buildings and we don't have all of that infrastructure cost, and
so we're able to pay our people more and as well as lower our price for the
customers we serve," he says.
Even with these cost-cutting measures, American workers are still the more
expensive option. But industry watchers say so-called home sourcing will
continue to grow as companies look for quality that used to be harder to afford.
1. Define: rheumatoid arthritis, fibromyalgia, fatigue, outsource, overhead,
infrastructure.
2. Why are some companies turning to home-based workers instead of setting up
call centers for customer service people to work in?
3. How does this arrangement benefit workers like Maureen Quigley-Hogan?
How does it benefit the companies?
4. Why does high inflation in India make it less attractive to outsource call centers
there?
5. Have you ever talked to someone at a call center? Are you likely to be happier
with the conversation if you think the person you’re talking to is American than if
you think the person is a foreigner?
6. “Wages in the U.S. are falling.” Why is this?
7. Is it fair that companies hire call center workers in the U.S. because, on
average, Americans speak clearer English? When is discrimination justified?
When is it not justified?
8. Should American companies try to hire Americans out of loyalty to their
country? If so, how much of a premium should they be willing to pay on those
grounds?
9. Do you think that some customers who get their calls taken by foreigners
believe that companies should hire Americans instead?