It's a harsh reality that in economically uncertain times, outsourcing and offshoring can swiftly become a dirty words, and we can expect that both will be in the cross-hairs of US presidential candidates in the coming weeks, as they shoot for the patriotic vote and talk up the need to protect both skilled and unskilled American jobs.
Anti-outsourcing sentiments are really expressions of fear about the lack of job security. When any economy slows down, trust becomes central to all working people's lives – witness recent protests in the capital by the British police, which at least made good the government's promise to put more constables on the street – 22,000 of them – but perhaps not in the way Whitehall intended. That protest was not about money, but about the claimed breach of trust over a mediated wage settlement. The disastrous PR implications for the government are being keenly felt, and the issue is unlikely to go away.
This is a good time to remember that such issues are as much a problem for our industry as for any other, even as we become a critical focal point for national and international debate about job security at home. Outsourcing creates local jobs, while offshoring shifts jobs overseas; but it is the latter that grabs the headlines. As the sub-prime economic cold spreads, virus-like, in both the news and the stock markets, then both outsourcing deals and outsourcing providers are being watched more closely than ever before.
First, take Capita, famously the scapegoat for all the outsourcing world's ills in the eyes of Private Eye. On Monday this week, the union Unite (formerly Amicus) accused the company of breaking promises to staff on the Capita site in Belfast. Capita’s announcement of a further 41 job cuts was criticised by Unite as a further sign that promises to secure more contracts and maintain the Belfast site as a centre of excellence are not being kept.
In a union statement, Graham Goddard, Unite deputy general secretary, said: "Unite members are concerned that Capita have failed in their promise to secure the long-term future of their life and pensions operation. The announcement of 41 job losses today represents another blow for Capita staff in Belfast, who face growing uncertainty as the company have failed to deliver on Chief Executive Paul Pindar's original commitment to the workforce of ‘opportunity and business expansion’. It would appear that Belfast was simply a stepping stone into a new market for Capita.”
The statement continued: "Unite will strongly oppose any compulsory redundancies and urge Capita to come back to the negotiating table. We are calling on Capita to honour their assurances to their workforce."
The 116 staff in the life and pensions department in Belfast must now reapply for the remaining 75 roles.
Things are equally uncomfortable on the other side of the fence, as Shell has recently discovered. The announcement that it was outsourcing more than 3,000 IT jobs was firmly rebuffed, again by Unite, but also – rather unexpectedly, perhaps – by NOA chairman Martyn Hart, who lambasted the oil giant for devaluing IT workers within the company by offering redundancy packages that were a distant poor relation of those offered to oil workers.
Hart said of the announcement (as we previously reported) : “What is of interest here is how Shell seems to treat its IT workers, in comparison to their oil rig workers. Shaving 75 per cent off their redundancy package looks like a fiscal kick in the teeth. And it’s not just a monetary issue. This action could undermine the importance of IT’s role within the company. IT is fundamental to the functioning of all organisations and Shell – and other companies – would do well to remember that,” he said.
Shell is one of several companies that has attracted its own coterie of bloggers and industry watchers, not all of whom have the company's best interests at heart, as readers of website http://royaldutchshellplc.com know only too well. This site is not connected to Shell, but reports on its every move, and takes feeds from hundreds of news sources concerning big oil's political, environmental, and economic manoeuvres in every part of the world.
As an industry we must learn one lesson well, and learn it fast. If recession strikes, this will be the first economic downturn to be reported at Internet speed. Every time a UK, US, or European job heads east, it will be commented on worldwide in a matter of seconds. We must understand that we no longer exist solely in the world of business, but also in the Blogsphere. Not only will people be watching the outsourcing world for symptoms of the wider economic health of the country, but they will be talking about us, and it will be the negative stories that stick; not the mega-deals and the contract wins.
