- Johnny Taylor Jr. told the WSJ he outsourced an employee's job after she requested it be remote.
- Hiring someone in India saved the company around 40% in labor costs, he told the Journal.
- Since the pandemic, some tech companies have hired remote workers overseas, sometimes amid layoffs.
A CEO's anecdote to The Wall Street Journal highlights a potential risk workers face in asking to work remotely on a permanent basis: the company could outsource their job instead.
That's what happened when an employee at the Society for Human Resource Management who wanted to move states suggested that she could work remotely, the company's CEO, Johnny Taylor Jr., told the Journal.
Taylor decided to outsource the employee's role to someone in India, and the offshoring of the position saved around 40% in labor costs, he told the Journal.
The Society for Human Resource Management has a hybrid remote work policy that allows employees to work from home on Friday and Monday, a company spokesperson told Insider.
Taylor isn't alone in looking to tap into overseas labor — where the average compensation for tech jobs is often far lower than in the US.
Remote work opportunities for US workers boomed during the pandemic. But as some companies continue to struggle to find workers and look to reduce costs, offshoring positions overseas could see a surge.
This could hurt white-collar workers in the US in particular — a group that has already been hit by layoffs this past year. If more US businesses open their job listings to overseas workers, white-collar workers could find themselves competing with a global pool of applicants.
Some tech companies have already turned to overseas labor, including in Latin America, Europe, Africa, and the Middle East. This is a stark change for an industry that's often prioritized in-person collaboration, Insider reported, and the number of companies considering this option is rising. Companies who were looking to hire engineers in the US or Latin America jumped to 75%, Laskie, a tech-recruiting platform, reported in March. A year ago, 55% of companies were considering candidates in the US and Latin America.
"US tech companies are saying, 'We can hire an engineer in the United States for $300,000 or we can hire somebody great internationally with very similar experience for $75,000,'" Laskie CEO Chris Bakke previously told Insider.
Still, only positions that could be completed entirely remotely are at risk of outsourcing. And the number of remote positions offered in the US has been steadily declining, especially as more companies impose return-to-office policies. While fully remote work in the US peaked at 60% in 2020, as of March, only about 13% of US job postings were remote, according to ManpowerGroup, a staffing firm. The year before, 17% of job postings offered remote work.
