Think of a traditional business like a butchers shop. The butcher offers a service to customers, employs people locally, uses local (hopefully) produce. This forms a kind of economic wheel which creates a cycle, through which flows an exchange of goods, funds and benefits. In modern society these wheels interlock in a complex web of flowing assets, funds, benefits, human resources and services and as they all interlink within one countries economy, that economy is stable.

Important parts of these cycles are major service providers. Companies that most of us need to use every day such as banks, telephone companies and energy suppliers.

So what happens when earnings from people in the UK, a part of this flow that needs to go full cycle, go into the banking system, or go towards paying utility bills, but the human resources required to provide customer service, billing and even internal processes like payroll and technical support, become outsourced to different countries. Several things get put out of balance, we have a large company, responsible for a big chunk of national economic turnover not putting what it should back in to the economy by means of contracts to other UK companies and of course employment.

Worse still when a large company closes down part of its operation in the UK to out source it to another country which is completely separate from our economic system. This company is still turning over its same share within its marketplace, but putting a fraction of what it was back in. In a scenario such as this resulting job losses put further strain on national economy by means of the extra load on the benefits systems, even if that just means that 20% of staff made redundant claim job seekers allowance for 2 weeks to bridge a gap, this still represents a large figure in real terms.

I have not even begun to mention customer service issues when it comes to language barriers but I know that anyone that has experienced this 1st hand will have a greater understanding of this than I could convey with text alone. Suffice to say, I know that if I get put through to my Banks overseas call centre it will take around about 20% – 40% longer to complete my call and the tasks required than if I get through to the now diminished Swansea UK centre.

Most months of late I have been reading about processes being outsourced, it is an unprecedented trend, fuelled by high speed Internet connectivity and the availability of cheap global bandwidth so it is difficult to say where it will leave us, I hope that consumer pressure will continue to help curb this trend, this is certainly starting to happen from a customer service point of view with companies advertising only UK call centres as a unique selling point, however for less publicised industries such as TV production, outsourcing of specific processes is less obvious.

For example I read a while back about a major UK children’s TV production company moving its stop frame animation to Eastern Europe…. Problems with this;

1) the creative work force are still here in the UK and ether have to move to a different company to do the same job or re-train. If they move to a different company and the reason for the outsourcing is partly to do with government policies then this may happen again, it they re-train then this could also put a strain on public money.
2) let’s say the program in question airs on the BBC. The licence money coming 100% from UK residents, the majority of this being earned in the UK… that cycle I was talking about is broken.

I believe this leads to economic destabilisation, there is of course an argument for a global economy, these cycles spanning the world instead of just one country – and this of course has always happened but primarily with imports and exports.

What goes out of one pond must come in again and if it goes in to someone else’s pond theirs gets full while ours becomes empty.