Although invisible and often underappreciated, back-office staffing and outsource jobs are the lifeblood of every successful and thriving economy nowadays.
According to JobLogic, the back-office industry derived from offshore businesses and talent centres have already grown too big to fail. Without them, it would be impossible to sustain the current logistics and operations of virtually every global business chain.
Despite these facts, however, global mutual fund firms have come to a consensus to cut costs and lay off jobs, especially in the back-office and offshore accounts.
Series of Low Performance Leading to Belt-Tightening
The planned restructuring of back-office centres is ironic given that offshore help was sought in the first place because of the need to diversify and expand operations. But, UK Reuters reports, “After years of underwhelming returns in a low-interest rate environment, savers are dumping high-fee funds in favour of cheaper investment products, forcing asset managers to look more closely at the balance between income and costs.”
Right now, reverting to localised and satellite arrangements won’t sustain the influx of lead opportunities. In a sense, this is both a gamble to global financial institutions and a sure loss to the millions of back-office employees who will not have a place to work for anymore.
Fixing the Inflation via Nonhuman Talent Alternatives
In particular, the only certain answer that the global financial institutions can say is that the alternatives to the lost back-office staff will ultimately be cheaper; which in turn will help balance out any deficits in the transition.
Alastair Sewell of Fund and Asset Management Company Fitch states that “Increased regulation after the global financial crisis is pushing up the cost of doing business for the established players while nimble technology-driven rivals are springing up to offer alternative investment products at a lower price.”
There will be a strong inflow of mitigation strategies that will pave the way for hard and cost-effective solutions. The only question that remains is the kind of dissent will be born out of this disastrous and bold move.