Cookie Use Notification

This site uses cookies to provide you with a more responsive and personalised service.

By using this site you agree to our use of cookies as set out in our cookie notice. Please read our cookie notice for more information on the cookies we use and how to delete or block the use of cookies.

Outsourcing Sector to Grow by 6% Annually for Next Six Years

The full report

  • Sector set to expand despite increased competition from robotics
  • Repatriation of call centres and shared service centres unlikely to happen soon
  • Poland on the seventh position in the global ranking of mature BPO locations

LONDON, December 19, 2016 – Relentless cost-cutting by businesses – and banks in particular – is expected to see the outsourcing sector grow by six per cent annually for the next six years, according to an annual report from global property firm Cushman & Wakefield.

This year’s Where in the World assessment of the outsourcing industry suggests the trend of service industries to repatriate call centres and other shared service centres (SSC) to improve customer satisfaction is relatively small to the continued drive to offshore back and mid office processes.

This is because the wage gap between advanced economies and the emerging locations where many outsourced jobs are based, is not expected to narrow sufficiently for many years to come.

One of the report’s authors, Neil McLocklin, Co-head of Strategic Consulting (EMEA) for Cushman & Wakefield, said:Central Europe has seen rapid growth in outsourced jobs from Western Europe since the Millennium. Even assuming high levels of salary growth of 4-5% annually, compared to just 1-2% in Western Europe, it will take 15 to 20 years for the salary gap to narrow from its current ratio of about 1:3  to around half.”

In addition, more established outsourcing locations such as Poland face other pressures which could impact future outsourcing industry growth. These include:

  • Increased competition from new lower-cost locations in neighbouring countries such as Romania.
  • The rapid growth of advanced of Robotic Process Automation and cognitive computing.
  • Increased costs in combating the growing technological threat by up-skilling existing workforces to provide more than basic language and numeracy skills.
  • Challenging demographic trends and migration of skilled labour especially from secondary cities to western Europe.

From a global perspective, India has retained its position as the world’s leading outsourcing market with 56% global market share with the Philippines in second place with 15% – an industry that delivered 7% of the country’s GDP in 2015 compared to just 0.08% in 2000.

The Where in the World report ranks nations according to their attractiveness for Business Process Outsourcing (BPO) – taking into account factors including cost, quality of service and their political and economic stability. It separates these markets into two categories: ‘Mature’ and ‘Pioneering’.

The report’s fellow author, Tamas Polster, Co-head of Strategic Consulting (EMEA), said: “In pioneering outsourcing markets, Vietnam retains its global number one spot from last year. Europe’s top performer is Lithuania, up to third position from its fifth placing in 2015.

“Although outsourcing is facing pressures from rapid advances in automation, it will remain a growth industry for many years to come. It is, however, a business service that needs to be chosen by its customers with great care.

“Pricing is, of course, a very important consideration. But the quality of the service is paramount to firms keen to ensure customer retention – a reliable and effective service.

”Established BPO & SSC locations have in recent years significantly raised their service level sophistication, relying on more automation and themselves near shoring their lower value processes to emerging markets to maintain their competitive edge.”


Poland jumped two places from ninth in 2015 to the seventh position in the global ranking of mature BPO locations.

Bolesław Kołodziejczyk, PhD, Senior Consultant, Consulting & Research, Cushman & Wakefield Poland, said: “Poland is the largest BPO market within the Central & Eastern European Region with over 16 sizeable cities where the outsourcing industry has been growing since 1995 at a growth rate of 20% per annum. Banks and professional services companies that have traditionally shipped back-office work to Asia are keen to move more complex financial and legal tasks to Poland – attracted by time-zone proximity to Western capitals, EU membership and a better “cultural fit” with Western business practices. Poland also follows all European Union laws for copyright and IP (intellectual property) and in addition, they comply with United States standards in data security and IP protection.”

Another advantage of Poland is the ample modern office space stock of the country’s nine major markets standing at nearly 9 million sq m at year-end 2016.

BPO Pionieering Locations

BPO Mature Locations