UK’S biggest phone firm British Telecom (BT) will move back some 4,000 call centre jobs outsourced to Indian service providers, as the company seeks to ensure more employment opportunities for British workers and protect jobs of those employed directly by the company.
Both Infosys and Tech Mahindra, which count BT as one of their top customers, are expected to see a decline in back office outsourcing business from the phone firm.
A BT spokesman confirmed that his company will scale down third-party call centre staff based in India by around 4,000. “As per our policy, Infosys does not comment on client engagements or speculation,” an Infosys spokesperson said.
A Tech Mahindra spokesperson said: “We do not comment on specific customer engagement. We remain a strategic partner with BT across multiple service offerings.”
“BT Retail can confirm it is reducing its reliance on third-party call centre staff in India. By next year, approximately 4,000 less people will be contracted in India than was the case in early 2008,” said a BT spokesman.
Explaining the reasons for bringing jobs back to the UK, he added that with improved customer service, fewer support staff are required by BT. “Some work will. however. be moved back to the UK and given to full-time BT employees who have been affected by cuts elsewhere in these challenging times. BT has a responsibility to find work for its permanent workforce and this is just one measure it is taking to protect its direct workforce,” he added.
Experts such as Bob McDowall, research director at Tower Group UK, said that as more offshore outsourcing contracts come for renewal, more British customers could bring back jobs in order to address the local sensitivities.
“This is certainly a manifestation of protectionism,” Mr McDowall said. “There is growing populist resentment at jobs going away from the UK. Companies with highly visible brands such as BT are sensitive to populist consumer sentiment because of the impact it could have on their sales,” he added.
Unemployment in the UK is now around 2.4 million, about 7% of the working population. This adds to social security costs and is an additional financial burden on the UK taxpayers.
As reported by Economic Times earlier, Infosys could see revenues from its top customers go down to less than $300 million this financial year from around $381 million last year as BT restructures its operations and scales down information technology spend in order to cope better with the recession.
BT Global Services, which accounts for around half of Infosys’ BT revenues, had to write off nearly $500 million against inflated profits, the phone company announced last month. In November last year, BT also announced around 10,000 job cuts globally, as part of the company's cost cutting measures. (The Economic Times)