Moving Tech Support Jobs Closer

Some of Silicon Valley's largest technology companies, in an effort to cut costs and address a mounting stack of customer-service complaints, are embracing an offshoring trend known as "nearshoring.''

Unlike the traditional offshoring that flung U.S. customer call centers halfway around the world to India and other faraway countries, nearshoring sends white-collar jobs to Costa Rica, Mexico and other countries in the Western Hemisphere.

The allure of nearshore sites is their ample supply of knowledgeable, low-paid workers who speak the customers' language fluently, understand their cultural nuances and perhaps even live in the same time zones.

For big U.S. tech companies, shifting jobs to closer locations can avoid the operational bumps that would otherwise occur in the more distant, more popular offshoring destinations in Asia.

"It's important that the world knows that it's not just China and India,'' said Diane Burton, an associate professor of management at MIT's Sloan School of Management. "It is truly a more global phenomena where there are skilled and talented people around the world who are ready, willing and able to do the kind of work that (represents) good jobs.''

Experts say nearshoring is catching on with tech giants in Silicon Valley and companies nationwide. It offers sizable pools of low-cost labor in places that aren't yet overcrowded with potential employers, better serves the English- and Spanish-speaking population in the United States, and requires executives to spend less time sitting on airplanes when they need to trouble-shoot offshoring problems in person.

Several business professors and executives of offshoring consulting firms said Intel and Hewlett-Packard are among the U.S. companies on the forefront of nearshoring jobs.

According to NeoIT, a San Ramon-based consulting firm that advises companies on offshoring, Intel sent finance and information technology work to Costa Rica last year.

Intel spokesman Mark Pettinger said the Santa Clara-based chip company has been filling about 150 new financial services jobs in Costa Rica, but he said that's not nearshoring.

Intel "hasn't been shifting from one location to another,'' Pettinger said. "It's been scaling up to meet the needs of those markets in those geographies.''

As for HP, statements made by company executives in the United States and abroad, in addition to a company document, reveal the computer and printer giant is shifting portions of its workforce to countries with lower labor costs.

Pierre-Yves Tilly, HP France's human resources director who oversaw layoffs in France, said a few months ago that HP is nearshoring jobs from Western Europe to Eastern Europe and from the United States to Costa Rica.

Tilly said Costa Rica is a nearshoring site for HP's U.S. jobs. "We have the same thing in Europe with Slovakia, Bulgaria, Poland,'' he said.

"HP is making a multimillion-dollar investment in the infrastructure of our Costa Rica operations, as well as in training our associates, creating new jobs and developing career growth opportunities,'' Cesar Trujillo, a manager for HP Central America, said in an August press release. "By 2008, we expect to have more than 6,000 associates here.''

Source: Inside Costa Rica