Offshore outsourcing has become an important contributor to Caribbean economies, but like many other industries, it has been affected by COVID-19. We discuss some of the impact of the coronavirus pandemic on the industry, and what the future might hold in the short-to-medium term.<\/em><\/p>\n
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Across the Caribbean region and to varying degrees, many countries have recognised that offshore outsourcing is one of the fastest ways to secure foreign direct investment, whilst also creating jobs, which are much needed, with double-digit national unemployment rates being the norm. These rates tend to double, or even triple, among the youth population, and so there has been an urgency to get people employed, earning an income, in order to better support themselves and their families.<\/p>\n
In the era of COVID-19, where the region\u2019s tourism and hospitality industries have been adversely affected, the job market has become even worse. Although some countries have begun to welcome visitors, in-country infections rates are likely to increase, resulting in another round of lockdowns and restrictions. Moreover, since at this point, there is no vaccine, known cure, or authoritative treatment for COVID-19, into the foreseeable future, there will be an element of uncertainty that will cuts across virtually all aspects of our personal and professional lives.<\/p>\n
With economies across the region also in decline, and the major sector, tourism and hospitality, on shaky footing, the focus is likely to shift to other service-based industries, such as business process outsourcing (BPO). However, that industry, \u00a0here, we briefly examine how the outsourcing industry has been faring during COVID-19, and what might be in store for the future.<\/p>\n
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Like many other industries, the region\u2019s outsourcing space has had to make adjustments for COVID-19, but so far, it appears to surprisingly resilient. In June, Jamaican BPO firm, itelbpo smart solutions<\/a>, opened a centre in Saint Lucia<\/a>, and as was reported in this week\u2019s news roundup<\/a>, KM2<\/sup>, another BPO firm, is also looking to expand in Saint Lucia.<\/p>\n
However, in addition to the above considerations, one of the biggest challenges that Caribbean outsourcing facilities have had to grapple with, in order to allow employees to work from home, is telecoms, specifically the lack of availability of fixed-line broadband Internet access. High bandwidth and resilient service is a crucial element in the successful execution and delivery of offshore outsourcing services. However, across the region, the fixed-line Internet infrastructure does not extend into many of the communities where BPO employees live, and as a result, mobile\/cellular data services have had to be used.<\/p>\n
Although mobile\/cellular data provides a solution, there are two challenges that arise. First, is with respect to quality and consistency of the communication. Currently, mobile\/cellular networks across the region are managing considerable amounts of traffic, resulting in congestion on those networks. Also, in many instances a number of mobile\/cellular technologies, such as 3G and 4G. overlay each other; hence, transmissions speeds can change continually, which in turn affects the quality of the connectivity. Further, that experience can be exacerbated in adverse weather conditions, such as heavy rains and thunderstorms, which can be deleterious to the professional setting and serene experience a BPO company would like to project.<\/p>\n
Second, and perhaps more importantly, mobile\/cellular broadband Internet is still pricey across the Caribbean region. As noted in our article published last week on the price for 1 GB of mobile\/cellular data<\/a>, only four of the 31 Caribbean examined were in the less expensive half of the ranking of 288 countries worldwide.<\/p>\n
In the short-to-medium term, the future of offshore outsourcing is likely to be tenuous. Although economies worldwide might start to improve, as a new normal becomes established, we will not be able to return the attitudes, behaviour and confidence that existed pre-COVID-19. Having said this, there may be new opportunities emerging, in areas such as with regard to logistics and fulfilment, which have been on the uptick, as people shop more online, and opt to have purchases delivered.<\/p>\n
Additionally, the impact of automation and artificial intelligence on business cannot be dismissed. Its growing impact on the global outsourcing sector, over the past five years, is something countries and businesses have had to consider. Now, as outsourcing firms fight for survival \u2013 by streamlining their costs, optimising their processes, and maximising efficiency \u2013 the use of human labour will decline, which is a trend projected across virtually all sectors. As a result, countries, especially those in the Caribbean, which had been keen for the industry to absorb high school graduates, in particular, may need to implement some upskilling programmes so that current and prospective workers can be better matched to the emerging opportunities, and not to roles that no longer exist.<\/p>\n
Finally, telecoms and ICT have become vital as we navigate COVID-19. Caribbean governments may thus need to be more proactive in shaping policy and the enabling environment, in order to improve the standard of service we receive, so that our countries can, at the very least, maintain our competitiveness.<\/p>\n
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Image credits:\u00a0\u00a0Mark Hillary<\/a>\u00a0(flickr)<\/em><\/p>\n