The Latest Call Center Industry Trends Impacting Site Selection Strategies

by King White, on Oct 19, 2021 10:02:04 AM

The call center industry has been through a lot over the last 18 months due to the coronavirus pandemic. Companies were faced with large scale migration to work-from-home (WFH), implementation of new cloud-based software platforms to support WFH, and extremely challenging labor market conditions across the world. Amazingly, the industry has survived and appears stronger than ever. To help assess the situation, Site Selection Group has summarized the call center location trends that are emerging but may change as things stabilize.  

U.S. Call Center Market Trends

  • COVID-19 protocols, unemployment benefits, WFH, and mounting wage pressures have impacted the U.S. call center market.
  • The biggest impact is wage inflation which increased by more than 20% over the last 18 months which has created significant budgetary and recruiting issues.
  • $15 per hour has become the new entry wage for call centers.
  • Companies that were paying $12-14 per hour pre-COVID-19 are now paying $15-17 per hour.
  • Most companies are implementing the following location strategies:
    • Virtual WFH – Full conversion to WFH model with virtual recruitment and training
    • Hub and Spoke – Partial WFH model with 25-75% of staff working within 100 miles of a centralized training facility.
    • Facilities-based – Plans to bring all or most employees back into their facilities.
  • WFH has enabled companies to recruit across the U.S. but hasn’t solved their recruitment challenges due to macro labor market issues.
  • There has been minimal to no savings achieved by a shift to WFH due to increased costs related to increased IT, software, and supervisor/management expenses.
  • Most companies are holding on to their call center facilities in a wait-and-see strategy. As a result, there isn’t a glut of vacated call center facilities.
  • There is no consistency in WFH versus facilities-based strategies by industry. WFH policies are driven at the company level with no clear industry trends emerging yet.
  • Most companies have focused recruiting and expansion efforts in Tier 1 (1 million population) and Tier 2 (500,000 -1 million population) cities where there is much more depth in the labor markets as they battle for employees.

Nearshore Trends

  • The Latin America and Caribbean Region, also known as “Nearshore,” is the hottest and fastest-growing region due to proximity to the U.S., low wages, bilingual capabilities, and geographic diversification from the Philippines.
  • Labor markets are strained across most markets due to a fast rate of growth and issues related to COVID-19 protocols.
  • Business process outsourcers continue to lead job creation with some captives, like Amazon, entering markets like Costa Rica and Colombia.
  • Bilingual agent wages have inflated by 20% over the last couple of years.
  • Attrition rates are reaching 6-10% per month now in most locations.
  • Bilingual agent wages are $3-4 per hour in Guatemala, the Dominican Republic, Colombia, Jamaica, Honduras, Nicaragua, and Mexico.
  • Bilingual agent wages are $4-6 per hour in mature countries such as Costa Rica and Panama.
  • Employee benefits are 40-50% of the wage costs.

Offshore Trends

  • The Philippines' growth has been stagnant due to coronavirus protocols and escalating attrition rates, which has caused companies to consider geographic diversification.
  • Wage rates are $2.50-3.50 per hour plus 50% benefits.
  • India continues to be mostly back office, non-voice activities with wages slightly lower than the Philippines.
  • South Africa is one of the hottest locations where wages are $2-3 per hour; however, COVID-19 has created a lot of challenges. Other challenges include the time zone, accessibility, and history of primarily servicing European countries.
  • Egypt is another hotspot with most of the growth from European business process outsourcers. Wages are very low and there are multiple language skills available.
  • Kenya and Vietnam are a couple of emerging markets but it’s too early to tell how successful they might become.


The call center industry is in a major cycle similar to the cycles after the dot-com recession and the Great Recession. All cycles come and go so companies need to be prepared to pivot quickly and adjust their call center location strategies accordingly. For example, if one major data breach happens due to the WFH model then we could see the whole market flood back into their facilities which provide a more secure environment for data security. Only time will tell when the current cycle shifts and how it will impact your site selection decisions.

Topics:Call CenterSite Selection GroupCOVID-19WFH



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