US to Lose 700k BPO Jobs by 2022

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Editor Coda
Oct 12, 2017

Automation, particularly finance automation technology, is poised to take the jobs of hundreds of thousands of people in the next 5 years. According to AT Kearney’s 2017 Global Services Location Index, the US will be hit particularly hard. The report predict the US will lose 702,000 Business Process Outsourcing Jobs by 2022.

These BPO jobs are generally jobs that have been outsourced from other companies, but currently are still done ‘onshore’ in the US. Typically these are transactional back-office functions and call centers.

The rate of job losses, the report says, is due to the number of jobs which are relatively easy to replace with automation (such as repeatable, rule-based, transactional jobs). In the BPO landscape, finance and accounting jobs have the highest potential for automation while jobs such as customer service roles are less easily automated due to the human component.

Globally, the US BPO job losses represent 20% of all BPO jobs that are predicted to go in the next 5 years. India is predicted to lose 250,000 BPO Jobs and the Philippines, Poland will also be significantly affected.

Projected BPO jobs at risk

Source :AT Kearney: The Widening Impact of Automation

However automation will also create some jobs. The report estimates the US will gain nearly 175,000 new BPO jobs including jobs managing the automation technology. Factoring in the higher salary from those jobs, AT Kearney predict that the net effect is an additional income of 7% of total payroll, offsetting the 20% lost from automation.

The report predicts India will be less well off when it comes to new BPO jobs, and where they are expected to lose 250,000 jobs, with only 2% are to be regained.

What seems to be inevitable is that the job landscape is shifting. As automation technology continues to roll out, it will replace lower level jobs and create a greater need for highly skilled workers.

For full details of the report, download the white paper.

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