A new trend has been emerging in the labor markets, but is it really new? They call it “onshoring” – term that plays off of the “offshoring” concept.
For the past 15 years, large US corporations have looked to developing countries for trained, educated workers with particular skills at a fraction of the cost of a US worker’s salary and the overhead costs associated with employing someone locally, including health care, payroll taxes, worker’s comp and more. This has been particularly prevalent in the information technology sector and in recent years, startups have embraced the offshoring approach to bring new technology ideas to market.
Outsourcing work to non-citizens outside of one’s country is the common definition of “offshoring”. Conversely, “onshoring” is outsourcing work to citizens within one’s country.
…but isn’t this just a fancy new name for recruiting?
Yes and no. Onshoring tries to take advantage of cost savings within a country, with work being performed in states and regions that have a lower cost of operation for companies that are located in areas with higher overhead costs. In a weak job market, this type of “worker arbitrage” may be possible for at least awhile.
From an entrepreneur’s standpoint, it’s a trend to watch, and there are good articles being penned about this, including one in The Harvard Business Review. A startup in a high cost urban area may be able to find an IT consulting firm with some needed skills in a lower cost, rural area. From this perspective, “onshoring” is a great equalizer for the economy and for the environment – creating jobs domestically and leveraging telecommunications to minimize wasted time and money on commuting and relocations.
Now let’s add another layer of variation through an actual job-creating scenario: how about an technical recruiter firm from another country being engaged by a US company to help hire US workers?
We’ll let someone else figure out what to name this concept (“off-onshoring”? “on-offshoring”?) and we’ll focus on the live example.
TechSoft InfoSolutions (“TSIS”) is a member of the ActSeed Community and a small, entrepreneurial information technology company in Bangalore, India. They specialize in AutoCAD, Visio, GIS, web development and ecommerce technologies. They have almost two decades of experience working with US companies both in the US and from India. They have parlayed this experience into a new role: technical recruiter. The “wrinkle” is that they are using their technical expertise to help US companies find and evaluate candidates for hire IN the US.
Right now, TSIS is helping a company in Texas find software engineers who have expertise in an ecommerce software called Ariba. They are looking for functional business analysts for software modules like Ariba Buyer, ACM, Ariba Sourcing and Ariba Contracts. By the way, if you have these skills, send TSIS your resume at firstname.lastname@example.org.
While TSIS is one interesting example, there are many more. From a small business owner’s perspective, onshoring is definitely a concept worth exploring and one that ActSeed will be following closely as it represents the opportunity to create jobs and commerce in the US.