UK leads Europe on offshore trend

25 August 2004
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26 August 2004 | David Arminas

UK firms are leading in outsourcing to improve their supply chains, according to a report.

Britain is outsourcing its work faster than any European country, according to Two-Speed Europe: why 1 million jobs will move offshore, from analyst Forrester Research.

This year, the UK and Ireland will account for £515 million of the £1.1 billion-worth of offshore contracting. Most of the UK's offshoring takes place in the financial services sector.

By job totals, 100,000 British jobs will leave the UK by 2005. In Germany, 11,000 will go, with 7,000 in France and 4,000 in Italy.

Andrew Parker, research director at Forrester and author of the report, said negative and emotive aspects could hinder a company from offshoring.

"Recent actions such as union attempts to block Lloyds TSB's offshore activity, could hold offshoring back," he said.

In Europe, around 500,000 jobs are expected to go by 2010 and Forrester predicts by 2015 this could rise to 1.2 million. Britain would account for the largest number, around 760,000.

Of the 1.2 million jobs to go in Europe, 350,000 will be in the financial services sectors with 175,000 going in manufacturing, telecoms, media and technology sectors.

Forrester defines offshore outsourcing as contracting for services by a supplier that is at least 500 miles from a G7 country, in Europe: France, Germany, Italy and the UK. It surveyed 247 client companies and 19 international, European and offshore service providers.


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