Wednesday, November 29 2017
By Pete Mohan, Site Selection Consultant for Wadley Donovan Gutshaw Consulting
Since 2014, back office employment growth has been modest at best. In light of the performance of the economy over that period, the concerns over that stagnation are justified, and multiple factors are to blame. For this article, “back office” is defined to encompass all administrative functions that don’t require a specialized four-year degree, including customer service, financial clerking, data entry, etc.
As back office operations have evolved, two tiers of center have emerged; companies have opted to increase complexity of tasks and level of responsibility in some centers, oftentimes requiring a bachelor’s degree; for centers not requiring that level of education, finding cost-effective locations to train-up entry and experienced talent is the priority. Due to this bifurcation of back office labor needs, both high- and low-level operations face unique challenges, and each have opportunities for growth. Current State of Back Office Employment (see Table A) Back office employment in the U.S. has grown at less than half the rate of total employment since 2014 (2.8 percent vs. 5.9 percent). Back office employment in medium- and large-sized metros has grown more rapidly than smaller metros as well as the national rate. However, this trend seems to be driven primarily by general labor availability, as total employment growth still outpaces back office growth by at least 50 percent in each of the different metro area size groupings. Additionally, in the 160 metros with employment growing faster than the U.S. rate, back office employment has increased by 8.7 percent, whereas metros growing slower than 5.9 percent have lost 2.4 percent of back office employment over the past three years.
Tuesday, November 22 2016
By John Boyd, Jr., Principal of The Boyd Co., Inc., Location Consultants of Princeton, New Jersey
Corporate Headquarters Mobility
What's driving this new wave of back office relocations is the heightened mobility of the corporate headquarters itself and the realization by many corporations – faced with global competition and an uncertain economy - that improving the bottom line on the cost side of the ledger is far easier than on the revenue side.
Historically untouchable in corporate restructuring programs, the corporate headquarters office is now in play like never before. Just ask Omaha, still reeling from ConAgra’s relocation of its headquarters from Omaha to downtown Chicago and its jettisoning of some 1,500 jobs. Or ask Bergen County, NJ, after losing the Mercedes-Benz North American headquarters and some 2,000 jobs to Atlanta. Fortune 500 food giant ConAgra had called Omaha home for almost a 100 years and Mercedes-Benz has been a fixture in Bergen County for half a century.