Offshored jobs returning to mid-size U.S. cities
Verizon consolidated nearly 1,500 finance operations staff from more than 300 U.S. locations into service centers in Lake Mary, Fla., and Tulsa, Okla., indicative of a trend among companies placing business service operations in mid-size U.S. cities rather than offshore locations such as India, according to a new report.
The Hackett Group reported Tuesday that many U.S. companies are giving serious consideration to U.S. locations for service and IT centers due to a “diminishing gap in labor costs, combined with factors such as lower turnover rates, greater business knowledge, proximity to customers and headquarters, and state tax incentives.”
There are nearly 700 shared service centers running in the U.S. and the number of new business services jobs being placed in offshore locations has “declined steadily over the past few years and will continue to do so,” according to the report.
In a statement included with the report, Karan Mehra, Verizon’s director of corporate-finance restructuring, said, “By staying domestic, we got instant buy-in from both our clients within Verizon and throughout the finance organization itself. We have also been able to maintain complete control over our finance operations and processes, which can be difficult to do when you move offshore. And finally, avoiding extended travel times when visiting our service centers has been a significant advantage.”
The report did not include evaluations of any Massachusetts cities. The ten “most attractive” U.S. cities for establishing global business service centers were Syracuse, N.Y.; Jacksonville, Fla.; Tampa, Fla.; Lansing, Michigan; Grand Rapids, Michigan; Atlanta, Ga.; Allentown, Pa.; Green Bay, Wisconsin; Richmond, Va.; and Longmont, Colorado.