Serbia May Benefit by Offering Cheaper Labor, Uncategorized
U.S.-based Sitel, one of the world’s largest outsourcing companies, is discovering Serbia.
The company, which has some 60,000 employees worldwide in the U.S, Asia and Latin America, is full of praise for the Balkan country, where it’s recently opened up shop.
Joe Doyle, vice-president for global marketing, says Sitel has been “hugely impressed” with what Serbia can offer to its clients.
“Cultural affinities, first-class language skills, strong IT and transport infrastructure and Belgrade’s vicinity to other European capitals were key drivers to move to the country,” Mr. Doyle said.
Sitel, which currently employs some 30 people in Serbia, has the capacity to increase staff at least ten times over the next few quarters as its bureau offers work space for some 350 employees. More office floors could be rented if demand ramps up, Mr. Doyle says.
While Serbia is unlikely to turn into an India-style outsourcing powerhouse anytime soon, even if wages in Serbia are low while manager-level salaries are increasing in India, Sitel’s move bodes well for the country that is plagued with unemployment.
The jobless rate in Serbia is currently at a staggering 22.2%, often affecting well-educated students who are forced to leave the country in search for jobs, adding to the brain drain that began during the Balkan wars in the 1990s.
But companies such as Sitel can help the Serbia turn around and attract more business as the cost of living and low salaries offer a big competitive advantage, especially during the current crisis that forces many U.S. and western European companies to cut costs and seek cheaper resources.
The average monthly salary in Serbia stands at about 520 euros, a fraction of the average in Switzerland, the U.K. or the Netherlands, which are under rising pressure to move operations to low-cost countries.
Serbia might just be that kind of place. According to U.S.-British consultancy PMR Consulting, Serbia’s “relatively low employment costs, strong links with Western economies and increasing number of university graduates” make it a worthwhile market to invest in.
But almost the same is true for many of its neighbors, such as Bosnia & Herzegovina, Albania or Macedonia, which could well benefit from a potential outsourcing boom in the region.
According to GoalEurope, a software development outsourcing advisory firm, demand for such services is growing fast in eastern Europe, especially in countries such as Russia, Ukraine and Belarus. While this is partly due to low wages, the workforce’s language skills play an increasingly important role as a strong selling point.
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