Skills top driver for e-outsourcing

Citation

(2001), "Skills top driver for e-outsourcing", Education + Training, Vol. 43 No. 8/9. https://doi.org/10.1108/et.2001.00443hab.028

Skills top driver for e-outsourcing

Skills top driver for e-outsourcingKeywords: Out-sourcing, Information technology, Communication technology

Some 43 per cent of Europe's employers are using information and communications technologies to outsource business services. Their main purpose is to gain access to high-quality skills. Contrary to popular perceptions, they are more likely to choose a supplier in another European region than to go to India or the Caribbean for cheap labour. These are among the main conclusions from the Emergence project, led by the Institute for Employment Studies (IES), which has published two complementary reports: e-Work in Europe and Where the Butterfly Alights: The Global Location of eWork.

Peter Johnston, head of the European Commission's new-ways-to-work unit, which funded the research, said: "This research demonstrates very well how far we have already moved towards a knowledge economy in Europe, and around the world. It shows that the new methods of work on the Internet and with mobile communications have already made a major impact on the location and types of employment. It reinforces the need for Europe to invest more and faster in new skills and working practices to remain competitive, to continue to create more and better jobs, and to make more efficient use of all our resources for sustainable growth."

Richard Pearson, IES director, commented: "These results raise new questions for European policymakers about employment mobility. It seems clear that, in many cases, employers are choosing to move the work to the people rather than bringing the people to the jobs."

"The prospect of a global market in information work has raised the spectre of a global race to the bottom, with employers seeking ever-cheaper sources of labour", said Ursula Huws, Emergence project director, "but our research suggests that such fears have been exaggerated, at least in the short term. However, there is a very real risk of a global digital divide with some countries and regions being excluded from the new cyber-labour market."

Despite the publicity given to the practice of relocating or outsourcing work to non-European destinations such as India or the Caribbean, this is strongly outweighed, numerically speaking, by cases where work is relocated with Europe. For most functions, the most favoured regions were in developed urban areas in Germany, the UK, The Netherlands and Belgium. An examination of the reasons for choice of a remote back-office location or an outsourced supplier of electronic services overturns some popular stereotypes. Several factors were notable by their absence, including the availability of government grants or other state incentives to choose a location, and low staff turnover. In general, by far the most important selling point of any region is the availability of technical expertise. This is followed by low cost, which is followed by a good reputation and then by reliability or high quality. "The European regions with the highest concentrations of employment in IT sectors and occupations are strongly clustered around major conurbations", says co-author Nick Jagger. "These include the capital cities of Stockholm, Paris, Brussels, London, Helsinki, Rome, Madrid, Munich and Vienna, as well as the densely-populated Netherlands".

The details for both reports are:

e-Work in Europe: Results from the Emergence 18-Country Employer Survey, U. Huws, S.’O'Regan. IES Report 380, June 2001. ISBN 1-85184-309-4. £35.00. Where the Butterfly Alights: the Global Location of e-Work, U. Huws, N. Jagger, P. Bates. IES Report 378. ISBN 1-85184-307-8. £35.00.