Why the contact center industry is calling the U.S. home

Article by JLL Staff Reporter
Woman on the phone with customer services
Image credit: Shutterstock

Next time you dial ‘0’ while on a customer service helpline for an American company, your call may well be answered in the United States.

It’s part of an ongoing reshoring shift in recent years, and it will likely continue for at least the next five years amid rapid changes in the industry as technology and automation rewrite the rules of consumer engagement.

Gone are the days when live help desk personnel answered mundane questions like, “What’s my password?” or “Where can I find your product?” Live answers to basic questions have been almost entirely replaced with automated “self-serve” solutions, like FAQs and better website search capabilities.

But automation hasn’t made customer service obsolete. In 2016, spending on global contact centers reached $310 billion as the industry keeps stride with ever-growing consumer demand, according to JLL’s inaugural Contact Center Outlook. In addition to spending on technology, the industry is investing in higher pay for higher-quality talent to deal with the complex issues and questions that automated solutions can’t handle.

That’s one reason the United States is becoming the epicenter of global contact center growth.

“With demand increasing for multi-channel digital customer support, the U.S. contact center real estate market is becoming more active than ever,” says Kyle Harding, Co-Lead of JLL’s Contact Centers group. “In large part, it’s because U.S. locations tend to have the tech-savvy talent pool that is now an industry must-have.”

Why the U.S. is ripe for industry growth

The contact center industry has already been ramping up its presence domestically. Employment has increased by 21.8 percent over the last five years to more than 2.3 million people. Three distinct forces are driving its momentum:

  • Digitally savvy talent, and supporting technology, abounds in the United States.

Now that the lion’s share of customer interaction requires a highly skilled, digitally savvy workforce, the economic argument for going overseas for low-cost labor becomes muddled. After all, many U.S. metro areas have people with the skillset to support the modern contact center market. It can also be more cost-efficient to keep technology infrastructure in the U.S. where technology resources are abundant and onshore technical teams can handle installation, maintenance, optimization, and analytics. As such, in-house and contact center outsourcing (CCO) providers alike are finding good reason to shore up their U.S. presence.

For example, the number of CCOs with at least 25 percent of their workers located in the United States is up to 53 percent of all contracts signed in 2015, 18 percent higher than in 2010.

  • Mergers and acquisitions (M&A) are enabling massive organizations to rewrite the map.

Large operators like Alorica and Genesys, which are seeking market share and expanding their presence and services, have turned to M&A to optimize their portfolios. Once consolidated, these companies needed to carefully re-evaluate their real estate investments to avoid redundancy in some markets and add presence where needed. For example, some of these organizations have successfully used analytics to prioritize contact center locations that have the right combination of workforce, market saturation, and rental rates.

These M&A-driven real estate assessments have fueled new efforts to streamline costs while creating the more flexible contact center workspace that high-caliber employees now demand.

“Contact center leaders are learning that offering a greater mix of workspaces can enhance the employee experience,” says Tadd Wisinski, Co-Lead of JLL’s Contact Centers group. “Flexible workspaces allow businesses to scale up or down when needed. We’re also seeing a renewed push for plug-and-play contact centers that offer workplace choice and scalability, while being move-in ready.”

  • Geopolitical change brings uncertainty and continues to influence the market.

The geopolitical climate is changing in key global contact center markets while pressure mounts to bring jobs back to the country. U.S. policymakers have displayed a strong interest in keeping more of these jobs at home. Recent legislation to this effect includes the U.S. Call Center Worker and Consumer Protection Act of 2013, and the Bring Jobs Home Act of 2014. Moreover, President Donald Trump has stated his plans to limit offshoring, though it remains to be seen how this might influence the contact center industry.

Continued growth is on the menu

As the U.S. contact center industry evolves in line with the need for digitally skilled talent, burgeoning M&A activity, and a domestic jobs-oriented policy environment, many companies are likely to stay closer to home in the next five years. What happens next will depend on how well contact center management teams can balance investment in talent and technology resources with paying for prime locations.

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