More companies that once might have been tempted to pack up and move to cheap labor markets overseas are examining options closer to home.
Typically, they wind up paying a bit more to “onshore” the positions -- siting IT staff, support centers and the like in Missouri, Arkansas, Minnesota and Mississippi, for example -- but reap hefty benefits by avoiding the hassles of managing remote workers, often many time zones away.
IT labor costs in small communities can run up to 35% less than in urban labor markets and traditional tech areas such as Silicon Valley, Calif., according to the McKinsey Quarterly report.
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Uncle Sam is helping rural communities become attractive options for IT backroom operations. The U.S. Departments of Agriculture and Commerce are administering a $1.8-billion investment fund targeted to bringing broadband technology to rural communities with poor or no access to high-speed Internet service. Making broadband accessible to more Americans in rural areas will lead to additional higher-skill jobs in many other parts of the country.
Companies putting IT operations in rural U.S. areas run the gamut from large to small. Among them are GlaxoSmithKline, Blue Cross Blue Shield and RJ Reynolds Tobacco. Small and midsize companies are the likeliest candidates to locate all of their IT back rooms in the U.S., according to Monty P. Hamilton, CEO of Rural Sourcing Inc., which provides recruitment, training and management services to businesses looking to set up domestic sourcing operations. Many large firms will probably continue to maintain some overseas locations while setting up others in the U.S.
Besides Rural Sourcing Inc., companies that can assist businesses seeking rural options include N.E.W. Customer Service Cos. and Onshore Technology Services.
-
Dow Adds 314 Points to Thanksgiving Rally: Stock Market TodayInvestors, traders and speculators enjoy the best Thanksgiving Week gains for the major stock market indexes in more than a decade.
-
Why Prepaying Your Retirement Dreams Might Be a Financial Game ChangerHe bought his retirement home more than a decade before he plans to retire. Was it the right move?
-
Amid Mounting Uncertainty: Five Forecasts About AIThe Kiplinger Letter With the risk of overspending on AI data centers hotly debated, here are some forecasts about AI that we can make with some confidence.
-
Worried About an AI Bubble? Here’s What You Need to KnowThe Kiplinger Letter Though AI is a transformative technology, it’s worth paying attention to the rising economic and financial risks. Here’s some guidance to navigate AI’s future.
-
Will AI Videos Disrupt Social Media?The Kiplinger Letter With the introduction of OpenAI’s new AI social media app, Sora, the internet is about to be flooded with startling AI-generated videos.
-
What Services Are Open During the Government Shutdown?The Kiplinger Letter As the shutdown drags on, many basic federal services will increasingly be affected.
-
The Economy on a Knife's EdgeThe Letter GDP is growing, but employers have all but stopped hiring as they watch how the trade war plays out.
-
Banks Are Sounding the Alarm About StablecoinsThe Kiplinger Letter The banking industry says stablecoins could have a negative impact on lending.
-
Apple Readies for AI Upgrade with New iPhonesThe Kiplinger Letter The tech giant has stumbled when it comes to artificial intelligence, but a new batch of iPhones will help it make headway.
-
Japan Enters a New Era of Risk and ReformThe Kiplinger Letter Japan has entered a pivotal moment in its economic history, undertaking ambitious policy and structural reforms to escape from decades of stagnation.
