Struggling call centers closing down in US

September 20, 2011: In the past three years we have faced immense ups and downs particularly in the IT and BPO industry, especially with Indian companies opening new units in the overseas and US based companies shifting their centers from India to Philippines. But downtrend in the US economy is gradually diminishing the recent glittering seen in the industry. Companies are thinking of pulling out from the US.

It is the Tata Business Support Service Ltd which has made a shocking announcement that resulted to be a big blow in the industry particularly for the employees working in US based Indian call centers and Outsourcing units. According to the announcement the company is shutting down call center units with a huge work force. The company informed the crucial decision taken was because of the loss of two major clients. The decision made by the company has also resulted in the layoff of 251 employees in Reno (Ohio) and Milton (Florida). Experts suggest that this could also be a threat for many other outsourcing centers in the near shore market.

Today most of the Indian players are looking forward to open units in the overseas near shore outsourcing market as there are immense benefits prevailing. To provide the perfect solutions and service at the right time without compromising quality with cultural equal lance can be achieved by opening units in the overseas. But, at present it might not be the right time to enter the market.

If this downtrend continue for another five years then the Indian BPO and Information Technology (IT) sector companies will be the most affected. We are entirely depended on the US based companies. A slight fluctuation in the US economy has a great impact on us, particularly our exports. Recession is anticipated any time. Economic slowdown will also affect the flow of foreign direct investment into the nation which is one of our major sources that has a positive impact on the economy.

At present the Indian BPO units and Information Technology (IT) sector companies have put a hold to fresh recruitment and also very conscious in entering into any new contract. If the economy continues to slow down beyond the present situation then it may even lead to revenue crash. Fresh investments into the outsourcing business may narrow down gradually as more crises are expected in the near future.

It is not only the one single Tata Business support service Ltd which has been forced to accept the sudden closure; there are many other companies in the queue.

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