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Last Updated: Wednesday, 7 June 2006, 18:05 GMT 19:05 UK
More UK service jobs 'set to go to India'
By Hugh Pym
Business correspondent, BBC News

A call centre in India
Outsourcing services to India remains popular with UK firms

From movie making to information technology, no-one can take their job for granted these days.

That's because India's army of skilled workers is taking on work for British companies, while the country's colleges are producing 2.5 million graduates every year.

The business outsourcing phenomenon was examined by Deloitte's director of research Chris Gentle in 2003.

The offshoring of manufacturing jobs to China was well documented - less so the transfer of service work to India.

Mr Gentle predicted then that hundreds of thousands of service jobs in the UK would be affected.

He has updated his forecast for the BBC, suggesting that another 150,000 will be affected between now and 2010. The majority of those will be outsourced to India.

'International competition'

Ten years ago we would always have used local researchers, now we always go offshore - the world is a village
Richard Anton, Amadeus Capital

"There is increasing eradication of people and paper in service industries," Mr Gentle says.

"Service industries are now exposed to the full forces of international competition and globalisation. Anything that goes down a wire is up for grabs."

A company based near Delhi, NIIT Smartserve, confirms that outsourcing has moved well beyond call centres.

It has a deal to work with British financial advisers.

Accredited by the UK's financial watchdog - the Financial Services Authority - workers ensure advisers thousands of miles away are giving their clients the best possible guidance when it comes to pensions, life insurance and mortgages.

S Viswanathan, NIIT Smartserve's chief operating officer, says increasingly sophisticated functions are being taken on.

"When offshoring started, most work was recognised as voice-based," he says. "Today companies are looking more at work requiring processing and managing data, for example financial accounting."

Lower costs

Aranca, based in Mumbai, employs scores of graduates, many with MBAs.

They produce research for investment banks, brokers and other businesses in the UK.

"Because of the internet and low cost phone calls, its possible to get the same information in India as sitting in a UK office. It's a more cost effective location," says chief executive Hemendra Aran.

One of his customers is the UK technology investor Amadeus Capital.

"Ten years ago we would always have used local researchers, now we always go offshore. The world is a village," says the firm's director, Richard Anton.

European challenge

Mark Kobayashi-Hillary is an expert on international business and author of "Outsourcing to India".

He believes that this trend is a challenge to European workers, but not necessarily a threat.

"You have to remember that not every job can be sent offshore - many types of service jobs need to be delivered locally," he says.

But he acknowledges that even a small percentage of jobs being offshored is still a lot.

And there is the rub.

Deloitte's predicted total for offshored work doesn't sound much against a UK workforce of nearly 29 million. But it will mean big questions for the careers of at least 150,000 skilled office workers.


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