The local impact of services offshoring in South and Southeast Asia: introduction and overview.

Full text

1 The local impact of services
offshoring in South and Southeast
Asia
Introduction and overview
Bart Lambregts, Niels Beerepoot and
Robert C. Kloosterman
Services offshoring and its local impacts
Services offshoring in context
Mushrooming office parks, omnipresent recruitment signs, crowds of nightshift
workers celebrating the end of workdays with food and drinks at sunrise, booming
catering, leisure and retail businesses: in cities such as Mumbai, Bangalore,
Gurgaon, Manila, Cebu City and various others it is hard not to notice the impacts
of the unfolding shift of services production from the Global North to the Global
South. Services offshoring, as the process is called, has gained substantial
momentum since it surfaced in the 1990s. What started with a trickle of low-end
information technology (IT) functions being moved from the United States (US)
to India has grown into the large-scale migration of multi-various service product-
ion activities from advanced to emerging economies. Several millions of services
jobs in the Global North have already been affected (Fernandez-Stark et al. 2014)
and there is potential for many millions more to follow (Blinder 2006, 2009). The
underlying restructuring process and the resultant social and economic effects are
far-reaching and according to some observers indeed radical enough to justify the
use of powerful labels such as ‘globalization 2.0’, and ‘the second global shift’
(Bryson 2007, Freeman 2005).
To be credited for the global shift in services production is the increased
tradability of various services products, enabled by important advances in
information and communication technologies (ICT). The latter, over the past 25
years or so, have paved the way for the massive digitization of business processes
and the electronic transfer of the associated services products. Helped further by
diminishing trade barriers and the rise of a well-educated and IT-literate labour
force in the Global South, firms today enjoy literally a world of opportunities to
engage in labour arbitrage and expand their production networks. The IT-enabled
unbundling of service production processes allows for such processes to be
outsourced and/or offshored. While outsourcing refers to the migration of
production activities across a firm’s organizational boundaries (i.e. contracting out
a business process to a third party), offshoring concerns the relocation of activities
6192 T&F Local impact of Globalisation:Layout 1 9/6/15 10:48 am Page 1

overseas. Offshoring may or may not involve outsourcing. The former is often
referred to as ‘offshore outsourcing’, the latter as ‘captive offshoring’.
Since its inception, services offshoring has become an increasingly complex
phenomenon. Initially, work mainly flowed from the Global North to the Global
South. Today’s movements are more intricate, with investments and jobs also
migrating in the opposite direction and between countries in the Global South itself.
Patterns of specialization emerge in result, sometimes based simply on the kind of
language that is locally mastered (e.g. English, Spanish, French, Japanese) but
increasingly informed by more sophisticated differences in skills availability (e.g.
analytical and creative skills). Motives to engage in services offshoring have
become more variegated too. While initially offshoring was primarily about
achieving cost benefits through labour arbitrage, an emerging motive these days is
for firms to source skills that are increasingly hard to find ‘at home’ but still in
abundant supply overseas (Bunyaratavej et al. 2011).
The past years also have seen an impressive increase in the variety of services
activities being offshored. No longer does it concern customer relations services
(call centres), data processing (back office activities) and relatively simple IT
services alone. Today’s offshorable services are increasingly knowledge intensive
and include a choice of financial, legal, engineering, design and medical services,
along with an expanding array of ever more advanced IT services (such as
application development) and even research and development. In tandem with the
proliferation of offshorable services, a fairly complex nomenclature has developed.
The literature is peppered with acronyms such as BPO, KPO, LPO, BPM, IT-BPO,
ITES-BPO and others, with BPO standing for business process outsourcing, KPO
for knowledge process outsourcing, LPO for legal process outsourcing and BPM
for business process management. Each refers to different subsectors or segments
of the business process outsourcing industry. The acronyms IT-BPO and ITES-
BPO emphasize that services outsourcing and offshoring are strongly information
technology-based, with ITES standing for information technology enabled
services. In this volume ITES-BPO is used to refer to the industry at large, while
other acronyms may be used to identify particular subsectors or processes.
The above goes to show that services offshoring is a rapidly evolving practice.
On the back of the previous wave – the global reallocation of industrial production
– it deepens the international division of labour, further extends and refines global
production networks, and affects the lives of people and the fate of places in myriad
ways. Unsurprisingly, the trend, also dubbed ‘the next wave in globalization’
(Dossani and Kenney 2007), is increasingly recognized as one of global con-
sequence. The number of periodicals, blogs, conferences, consultants and scholars
engaging with the topic is growing rapidly. Political attention has become consid-
erable as well, notably in the most affected countries (e.g. the US, India, the
Philippines), but also beyond those. International development organizations have
become aware to the development potential as well and have emerged as active
contributors to the debate (see e.g. Asian Development Bank 2011, 2012, Ghani
and O’Connel 2014, UNCTAD 2005, UNESCAP 2011, World Bank 2007, 2009,
2011, 2012).
2Bart Lambregts, Niels Beerepoot and Robert C. Kloosterman
6192 T&F Local impact of Globalisation:Layout 1 9/6/15 10:48 am Page 2

Much of the academic debate so far has essentially centred around two major
themes. A first body of literature approaches services outsourcing and offshoring
from a business management perspective. It concentrates on the logics for firms to
engage in outsourcing and offshoring, explores the challenges involved and
develops advice mainly targeted at business practitioners (see e.g. Bäumer et al.
2012, Berry 2005, Brown and Wilson 2005, Couto et al. 2007, Eltschinger 2007,
Kobayashi-Hillary 2008, Metters and Verma 2008). Asecond debate focuses on the
question how services offshoring affects the economies of the countries and regions
from where the work departs. A central question here is whether offshoring of
relatively low value-added tasks creates opportunities for the ‘freed’ labour to
engage in higher value-added activities and (thus) strengthens the (global) compet-
itiveness of local firms, or whether the trend primarily adds to local unemployment
problems (see e.g. Bardhan et al. 2013, Breznitz and Zysman 2013, Levy and
Murnane 2005, Massini and Miozzo 2012, Milberg and Winkler 2013, Rubalcaba
2007).
Concentrating on local impacts in the Global South
This volume engages with a third dimension of services offshoring, and one that
so far has remained little studied. It concerns the local impact of services offshoring
in the economies where the work lands, with a focus on South and Southeast Asia:
the part of the world that attracts most of the services offshored (Tholons, 2014).
A trickle of publications addressing the effects of services offshoring in the Global
South has started to emerge (e.g. Ahmed 2013, Amante 2010, Beerepoot and
Keijser 2014, Benner 2006, Fernandez-Stark et al. 2010, Graham and Mann 2013,
James and Vira 2012, Ofreneo et al. 2007, Taylor and Bain 2005). Many issues,
however, remain underexposed – a deficit this volume aims to address.
As noted, in ITES-BPO hotspots such as Mumbai, Manila, Bangalore, Gurgaon
and Cebu City it is hard not to notice how the arrival of thousands of export-
oriented services jobs brings changes to the city. Most visible of course are its
physical manifestations: the mostly newly built office towers and business parks,
often well-guarded and surrounded by restaurants and shops catering to the office
workers; the manifold recruitment signs and activities (e.g. walk-in interviews in
popular and accessible places); and of course the bustle created by the crowds of
office workers either on their way to work, during break times or after work hours.
Yet, beyond these a range of other, less clearly visible but perhaps even more far-
reaching effects can be conceived as well. First of all, services offshoring, in the
same way as manufacturing offshoring has done and still does, pulls local
economies into the global economy. ITES-BPO firms, be they the result of foreign
direct investments or be they home grown, are fixed or flexible parts of the global
value chains (Gereffi and Fernandez-Stark 2010) or global production networks
(Coe et al. 2004) of multinational corporations (MNCs) and their likes. Essentially,
the arrival of an ITES-BPO industry means that a local economy and its actors
assume a role in specific, global value creation processes. While this creates
opportunities, it also introduces dependency (decision-making power in global
Introduction and overview 3
6192 T&F Local impact of Globalisation:Layout 1 9/6/15 10:48 am Page 3

production networks often is not located where the ITES-BPO activities take place)
and other challenges. Assimilation into the global economy by way of the arrival
of an ITES-BPO industry can be seen as a process of ‘strategic coupling’ (Coe et
al. 2008, Kleibert 2014, MacKinnon 2012), or in other words as a process,
involving both local actors and global producers/investors, in which local assets are
purposefully linked with the needs of global producer capital. How this process
plays out bears relevance for the way a locality becomes inserted in the global
production networks (e.g. its value creating role, its degree of control over affairs,
the resources supplied, the return on resources received, its potential to not only
create but also to capture value) and as such determines the potential for realizing
local and regional development.
Yet, to a certain degree irrespective of how the strategic coupling process plays
out, the arrival of an offshore services industry creates opportunities for a local
economy. These of course include employment opportunities for those who are
interested in and qualify for working in an ‘international’ office environment, but
also business opportunities and potentially more for those commanding the supply
of facilities that ITES-BPO firms need. Providers of office space and information
and telecommunications infrastructure, suppliers of supporting services such as
security, catering, transport and housekeeping, collectors of taxes, and those that
manage to appeal to the consumerist desires of those employed in the ITES-BPO
industry, may anticipate business. The business generated, in turn, may result in job
opportunities for others, including those who do not qualify for working in the
ITES-BPO themselves. Indian and Philippine industry stakeholders estimate that
every ITES-BPO job creates about three jobs elsewhere in the local economy
(IBPAP 2012, NASSCOM 2014). While these represent estimates rather than
proven numbers, an employment multiplier effect is likely to exist. Beyond direct
employment, increased business and indirect employment, the industry is also
likely to offer employees the opportunity to acquire skills and as such to contribute
to peoples’ employability (Beerepoot and Hendriks 2013, Marasigan in this
volume) and skills accumulation in the labour force at large, which must be
considered assets from social and development perspectives.
The rise of an industry that is globally connected, export oriented, relatively
well paying and applying international standards in at least part of its business
processes, is also likely to trigger transformations in the economy that surrounds
it, especially of course if this industry manages to accumulate some volume
compared to the size of the surrounding economy. Such transformations may
extend to supporting industries, which may have to step up their performance in
order to qualify for business (see Kumar in this volume), to government
regulations, which may have to be adjusted in order to accommodate new business
practices, to the educational sector, which may want to respond to new industry and
labour market demands (Kleibert 2015), and so on. In addition, for ITES-BPO
employees a job in a relatively well-paying, internationally oriented work
environment may open the door to a new lifestyle. Competitive wages are likely
to transform the lives of employees and their next of kin in various ways, and for
some may bring middle-class status within reach. Simultaneously, being part of
4Bart Lambregts, Niels Beerepoot and Robert C. Kloosterman
6192 T&F Local impact of Globalisation:Layout 1 9/6/15 10:48 am Page 4

an international work environment is likely to affect workers’ self-image and
consumer preferences. If indeed, as for instance Fuller and Narasimhan (2007),
Murphy (2011) and the World Bank (2013) suggest, services offshoring is
contributing to the rise of a new middle class in the emerging economies that
benefit most of the trend, the potential of the development to transform society
cannot be underestimated.
The above is not to say that services offshoring for the receiving economies
represents a carefree pathway to participation in the global economy and – possibly
– development, quite the opposite. There are important issues and challenges that
should not be overlooked. A pertinent question for example is who stands to benefit
from the trend and who not. The question may be addressed at the global level (i.e.
advanced/sending economies versus developing/receiving economies) but also at
the level of the receiving economies themselves. How inclusive or exclusive is
access to the jobs provided (Beerepoot 2010)? Who provides the supporting
infrastructure and receives the rents and fees payable by the industry? Who stand
at the receiving end of the consumer spending of the ITES-BPO workforce? Do the
answers to these question point at existing social, economic and political power
configurations simply being reaffirmed or does the arrival of an ITES-BPO
industry provide opportunities for new categories of actors to enter the playing
field and/or make a step up the social ladder? Another major challenge for receiving
economies concerns the question how to make sure that the arrival of an offshore
services industry is going to sustainably contribute to real development and not
fall into a low value-added, non-embedded services branch plant economy or
worse. If regional development is at least in part about successfully progressing
from making basic contributions to value creation, to being able to ‘move up the
value chain’ or to engage in ‘value enhancement’, and to eventually increase the
level of control over one’s contributions (value capturing) (Coe et al. 2004), the
challenges for those local economies currently producing footloose and low value-
added services in foreign-controlled global production networks, become crystal
clear.
South and Southeast Asia in the spotlight
Geographically, as noted, the book’s focus is on South and Southeast Asia. While
services offshoring is a truly global phenomenon, the largest concentrations of
offshored services activities are found in this part of the world. India and the
Philippines have surfaced as the world’s most important locations for offshore
services production (Asian Development Bank 2012, Dossani and Kenney 2007,
2009, World Bank 2007), with India distinguishing itself in the domain of IT-
intensive services and the Philippines excelling in contact services. Other countries
and cities in the region join in too, however, and are busy carving out their niches
in this emergent global services production landscape. Malaysia takes part
(Brooker 2011), China, in an attempt to diversify away from manufacturing, seeks
to hook up (Freeman 2005, Zhang in this volume), Hong Kong is establishing itself
as the region’s foremost centre for merchanting and merchandising services (Sigler
Introduction and overview 5
6192 T&F Local impact of Globalisation:Layout 1 9/6/15 10:48 am Page 5

and Zhao in this volume) and Bangkok slowly emerges as a hub for Japanese
contact services (Lambregts in this volume). The scene in the region is evolving
rapidly. What started as a relatively straightforward cost–benefit seeking pro-
duction relocation process with mostly western firms in various roles guiding the
process, has gradually turned into something much more intricate. The industry
still expands, but also matures and seeks for ever more efficient allocation of
resources throughout the region. In result, more refined divisions of labour and
more complex production networks emerge, increasingly also between and among
South and Southeast Asian countries. Here, local actors gradually gain confidence
and begin to assume increasingly important roles. Indian IT consulting and
outsourcing firms such as Infosys, Wipro and Tata Consultancy Services, for
instance, are already seen transforming into multinationals with production
networks extending into both the Global North and into the wider Asian region
(Beerepoot et al. 2014). These new developments, moreover, are superimposed on
and interfere with the still evolving outcomes of the global shift in manufacturing
production, which has worked to integrate (much of) the region in the global
economy from the 1960s onwards (Ofreneo in this volume). By focusing explicitly
on South and Southeast Asia, a regional hotspot for offshore services production,
we are able to point out differences and similarities between countries as they
engage with this latest wave of globalization and also reveal emerging divisions of
labour and interdependencies between them.
Aims
The book’s aims, finally, are threefold. First, it draws attention to this yet under-
researched dimension of the global services offshoring trend: the outcomes it
generates in the receiving locations, i.e. the countries and cities to where services
production is moved to. The book portrays the opportunities created for local
economies and their key actors, explores the factors that condition developments
and touches upon the potential threats associated with the trend. Original empirical
illustrations are provided and most chapters are based on recent empirical research
and as such make state-of-the-art contributions to the debate. The book’s second
aim is to assess how the outcomes of this latest wave of globalization are helping
to rebalance relationships at the regional and global levels. With new(er) divisions
of labour emerging between countries in South and Southeast Asia and between
these countries and other parts of the world, with local markets maturing, and with
local economic and political confidence growing, power configurations in global
and regional production networks are bound to change. Those involved are likely
to be affected in various ways, as revealed by the empirical illustrations provided
in many of the chapters. The book’s third aim is to investigate the implications of
the above for theories of economic development. In particular, the book examines
the extent to which we are seeing evidence of a services-based development
trajectory emerging as a real possibility. The road to development for developing
countries conventionally has been thought to ‘compulsory’ run via industrialization
(see Dicken 2011, Fröbel et al. 1980), but the stormy rise of especially India and
6Bart Lambregts, Niels Beerepoot and Robert C. Kloosterman
6192 T&F Local impact of Globalisation:Layout 1 9/6/15 10:48 am Page 6

the Philippines as exporters of services poses a challenge to this idea and raises the
question whether services-led development may be a viable alternative trajectory
of socioeconomic modernization (see also Rodrik 2014). By investigating different
pathways of services sector development and by scrutinizing how services
offshoring empowers (in terms of finance and skill development) the workers
involved and affects local economies we hope to provide the beginning of an
answer or at least some starting points for further scholarly debate.
Overview of the book
The above questions are explored in 13 chapters grouped in four parts. Part I
essentially sets the scene. It presents a broader framework for the analysis of the
role of services in development and looks into the ways the offshore services sector
has developed in India and the Philippines.
In Chapter 2, Robert Kloosterman, Niels Beerepoot and Bart Lambregts position
the rise of services in developing countries in a historical perspective and assess to
what extent these activities can indeed generate sustained growth. Initially, the
contribution of services to economic development was considered to be small as
only manufacturing was seen as being capable of delivering sustained growth in
productivity. However, since the second unbundling in the 1990s (Baldwin 2006),
advances in ICT and policies of liberalization have enabled digitized services to be
carved up into separate operations that can be commodified and, subsequently,
traded across the globe. This has introduced greater opportunities for making
productivity gains in services production and led to greater recognition of its role
as a driver of economic growth as elaborated on in the subsequent chapters.
Jana Kleibert in Chapter 3 takes up the ambitious task to compare the emergence
and evolution of the ITES-BPO sector of India and the Philippines. Basing her
work on interviews and secondary literature she discusses the role of government
policies, the education system, business associations, foreign investors, domestic
firms and returnee migrants. She shows that India should not be seen as ahead of
the Philippines in a singular development or pathway, but that rather important
differences in the availability of local assets and differences in opportunity
structures have led the two countries to get integrated into global services
production networks in essentially different ways. While India managed to develop
large domestic-owned firms in IT services, the Philippines’offshore service sector
so far has remained dominated by foreign investors delivering voice-based
services, which has consequences for the degree to which the countries are able to
capture the gains of ITES-BPO growth.
In Chapter 4, Antoinette Raquiza looks into the rise of the ITES-BPO sector in
the Philippines in more detail. She shows how over the past decade the arrival and
subsequent boom of the ITES-BPO industry has invigorated the Philippine
economy and led to a surge in the country’s trade in services. The chapter argues
that the proximate factors that have distinguished the Philippines as among the
world’s top offshore destinations for BPOs – notably, a large English-speaking,
skilled work force have also promoted the export of labour – a situation producing
Introduction and overview 7
6192 T&F Local impact of Globalisation:Layout 1 9/6/15 10:48 am Page 7

contradictory currents in the domestic labour market. By applying a political
economy approach that highlights the interactions between economic powers and
state institutions in the country, Raquiza raises critical concerns about the long-
term prospects of the Philippines’ current growth trajectory.
When discussing the economic benefits of ITES-BPO growth and addressing the
question how local embeddedness of foreign firms in this sector can be enhanced,
valuable lessons can be learned from the analysis of inter-organizational linkages
of Japanese multinational firms in the Philippines provided by Chie Iguchi. In
Chapter 5 she demonstrates how subsidiaries of Japanese firms in the Philippines
hardly maintain local input–output relations with local Filipino owned-firms. This
reduces the opportunities for knowledge spillovers and increases the chance that
production, once the Philippines becomes too expensive or otherwise unattractive
as a production site, relocates. The chapter brings together the literatures on
national innovation systems (NIS) and global value chains and should stimulate
discussion on the roles of multinational company subsidiaries in a NIS.
Part II looks beyond India and the Philippines and investigates how elsewhere
in the region export oriented services are produced and to what effect. As
emphasized by Xu Zhang (in Chapter 6), the success of India and the Philippines
in services exports has generated interest among other countries in Asia for the
opportunities provided by the trade. Xu Zhang examines how the Pearl River Delta
(PRD) in China aims to transform itself from the ‘Workshop of the World’ to the
‘Office of the World’. He shows that many PRD cities’ current service development
strategies and programmes still rely heavily on experiences accumulated in the
industrialization period. These tend to overlook the unique features of business
service activities as well as the assets that individual cities dispose of. Zhang argues
that that more targeted and place-based service development strategies and policies
are needed for cities in China, and warns that the options and measures available
to local governments in building the ‘Office of the World’ may be more limited than
they seem to think.
Next in Chapter 7, Thomas Sigler and Simon Zhou focus on Hong Kong’s vital
role in the global economy as an intermediary connecting China to the world at
large. The authors neatly show how since the territory’s decline in manufacturing
in the 1980s, Hong Kong’s economic growth has been driven by service exports –
primarily trade-related, transport and advanced business services – and then focus
on two related activities – merchanting and merchandizing – that have overtaken
Hong Kong’s entrepôt role since approximately 2007. Findings indicate that these
services offer limited employment opportunities and primarily serve to reinforce
historically dependent trade networks that benefit the upper echelons of the value
chain.
Bart Lambregts, in Chapter 8, examines the rise of a small but interesting con-
centration of Japanese call centre activities in Bangkok, Thailand. The conditions
for non-English-speaking economies such as Japan and Thailand to engage in
services offshoring are more challenging than for English-speaking nations. The
limited availability of Japanese language skills abroad, for instance, seriously
restricts opportunities for Japanese firms to offshore voice-based services. Japanese
8Bart Lambregts, Niels Beerepoot and Robert C. Kloosterman
6192 T&F Local impact of Globalisation:Layout 1 9/6/15 10:48 am Page 8

firms negotiate this condition by offshoring voice-based services to low-cost
destinations and by hiring Japanese staff at local wages. Bangkok, a city that
otherwise has remained relatively untouched by the services offshoring wave, is
such a destination. The chapter explores both the firms’ strategies and the motives
of the Japanese workers filling the cubicles.
Part III concentrates on workers engaged in the next wave of globalization and
how transformations in labour markets impact on their position and bargaining
power. The ITES-BPO sector is considered to provide the much-preferred white-
collar jobs for an increasingly college-educated labour force but it is criticized for
providing employment to only a narrow segment of workers.
Rene Ofreneo, in Chapter 9, argues that many workers in Asia have not
benefited from recent and current economic growth. These include workers in
Asia’s huge informal economy and in domestic-oriented industries. He uses the
metaphors ‘Factory Asia’ and ‘Service Asia’ to describe how Asian countries have
become integrated in global production networks of industrial and services
production. Taking a union perspective, he critically observes how in both cases
large segments of the labour force have remained excluded and that those who do
work in export-oriented production are increasingly confronted with flexibilization
and contractualization of work. According to Ofreneo, optimistic projections by
international agencies about the shift in economic power towards Asia and the
emergence of a so-called new middle class ignore how in various Asian countries
growth is uneven and exclusionary, and in many cases takes place at the expense
of labour rights.
In Chapter 10, Leian Marasigan uses the concept of employability to examine
the employment and job search experiences of former ITES-BPO workers in Metro
Manila. She finds that the knowledge, skills and other experiences gained during
employment in the ITES-BPO sector are not always recognized in the tight local
labour market that exists outside the ITES-BPO sector. Many workers also appear
to view BPO work as short-term job experience (a ‘transition stage’) rather than as
a serious career. The chapter argues for a more nuanced view of workers’
employment prospects post-BPO and lends support to the view that contextual
conditions are important factors influencing employability and the longer-term
prospects of those working in the ITES-BPO sector.
Randhir Kumar in Chapter 11 shows how in Mumbai the growth of the ITES-
BPO sector affects those involved in support services. More sophisticated demand
from ITES-BPO companies for support services such as security have changed
both the characteristics of what are traditionally regarded as low-end services and
the industry that delivers them. The emergence of multinational corporations in
low-end service production intensifies competition and makes it harder for local
firms to partake in the profitable market segment provided by ITES-BPO firms.
Part IV for the book focuses on the wider societal implications of the growth of
the ITES-BPO sector, in particular by raising the question whether it adds to the
formation of a new middle class in the countries and cities concerned. The rise of
the ITES-BPO sector is commonly associated with the emergence of a new
consumerist force. Hatekar and More in Chapter 12 show how the middle class in
Introduction and overview 9
6192 T&F Local impact of Globalisation:Layout 1 9/6/15 10:48 am Page 9

India has substantially expanded in the early 2000s. At least 600 million Indians
are now considered middle class, and are spending substantially more on education,
health, consumer services and durables than they did earlier. In overall terms, the
ITES-BPO sector, although often regarded as a main driver of new middle-class
formation, adds only marginally to this major transformation in the Indian society.
However, at local level the new spending power of ITES-BPO workers can incite
major transformations. As demonstrated by Krishnan in her research on ITES-BPO
workers in Mumbai, in Chapter 13, as well as Beerepoot and Vogelzang who focus
on a smaller provincial town in the Philippines, in Chapter 14, the development of
a consumerist culture is part of employment in this sector. Employees in the ITES-
BPO industry in Mumbai have experienced several changes in their consumption
practices. Many report to have become more brand conscious and to have
developed a taste for new cuisines and more luxurious modes of transport. The
chapter shows that the new middle class produced by the ITES-BPO industry
should rather be seen as a privileged section within the middle class itself and
identified by its new and expensive forms of consumption. Beerepoot and
Vogelzang in turn show how the ITES-BPO sector is expanding to smaller
provincial towns in the Philippines. These cities essentially skip the industrial stage
of development and instead become part of global services production networks.
The new employment opportunities generated by the sector, however, seem to be
to the direct advantage of a selective group of workers only.
The book ends with an effort by the editors to pull together the key messages
emerging from all this work and to identify avenues for future research.
References
Ahmed, G., 2013. Global value chains, economic upgrading, and gender in the call centre
industry. In: C. Saritz and J.G. Reis (eds). Global Value Chains, Economic Upgrading,
and Gender. Case Studies of the Horticulture, Tourism, and Call Center Industries.
Washington, DC: World Bank, 73–106.
Amante, M.S., 2010. Offshored work in Philippine BPOs. In: J.C. Messenger and N.
Ghosheh (eds). Offshoring and Working Conditions in Remote Work. Geneva: Interna-
tional Labour Organization, 101–134.
Asian Development Bank, 2011. Asia 2050: Realizing the Asian Century. Mandaluyong
City: ADB.
Asian Development Bank, 2012. Asian Development Outlook 2012 Update. Services and
Asia’s Future Growth. Mandaluyong City: ADB.
Baldwin, R.E., 2006. Multilateralising regionalism: spaghetti bowls as building blocks on
the path to global free trade. The World Economy, 29 (11), 1451–1518.
Bardhan, A., Kroll, C.A. and Jaffee, D.M. (eds) 2013. The Oxford Handbook of Offshoring
and Global Employment. Oxford: Oxford University Press.
Bäumer, U., Kreutter, P. and Messner, W. (eds) 2012. Globalization of Professional Services
– Innovative Strategies, Successful Processes, Inspired Talent Management, and First-
Hand Experiences. Berlin: Springer.
Beerepoot, N., 2010. Globalisation and the reworking of labour market segmentation in the
Philippines. In: A.C. Bergene, S.B. Endresen and H.M. Knutsen (eds). Missing Links in
Labour Geography: The dynamics of economic space. Aldershot: Ashgate, 199–210.
10 Bart Lambregts, Niels Beerepoot and Robert C. Kloosterman
6192 T&F Local impact of Globalisation:Layout 1 9/6/15 10:48 am Page 10

Beerepoot, N. and Hendriks, M., 2013. Employability of offshore service sector workers in
the Philippines: Opportunities for upward labour mobility or dead-end jobs? Work,
Employment and Society, 27 (5), 823–841.
Beerepoot, N. and Keijser, C., 2014. The service outsourcing sector as driver of develop-
ment: The expectations of Ghana’s ICT for accelerated development programme.
Tijdschrift voor Economische en Sociale Geografie, DOI: 10.1111/tesg.12122.
Beerepoot, N., Roodheuvel, I. and Jacobs, F., 2014. Integration of Indian Service Providers
in the Dutch Outsourcing Market. Amsterdam: Report for Platform Outsourcing
Nederland, Amsterdam Institute for Social Science Research.
Benner, C., 2006. ‘South Africa on-call’: Information technology and labour market restruc-
turing in South African call centres. Regional Studies, 40 (9), 1025–1040.
Berry, J., 2005. Offshoring Opportunities: Strategies and Tactics for Global Competi-
tiveness. Hoboken, NJ: Wiley.
Blinder, A.S., 2006. Offshoring: the next industrial revolution? Foreign Affairs, 85 (2),
113–128.
Blinder, A.S., 2009. How many U.S. jobs might be offshorable? World Economics, 10 (2),
41–78.
Brown, D. and Wilson, S., 2005. The Black Book of Outsourcing: How to Manage the
Changes, Challenges, and Opportunities. Hoboken, NJ: Wiley.
Brooker, D., 2011. Servicing a world elsewhere? Examining everyday work practices in the
emerging economic spaces of Malaysia’s business process outsourcing industry.
Singapore Journal of Tropical Geography, 32 (2), 141–154.
Breznitz, D. and Zysman, J., 2013. The Third Globalization. Can Wealthy Countries Stay
Rich in the Twenty-First Century? Oxford and New York: Oxford University Press.
Bryson, J., 2007. The second global shift: the offshoring or global sourcing of corporate
services and the rise of distanciated emotional labour. Geografiska Annaler, 89B,
pp. 31–43.
Bunyaratavej, K., Doh, J., Hahn, E.D., Lewin, A.Y. and Massini, S., 2011. Conceptual issues
in services offshoring research: A multidisciplinary review. Group and Organisational
Management. 36 (1), 70–102.
Coe, N.M., Hess, M., Yeung, H.W., Dicken, P. and Henderson, J., 2004. ‘Globalizing’
regional development: A global production networks perspective. Transactions of the
Institute of British Geographers. 29 (4), 468–484.
Coe, N.M., Dicken, P. and Hess, M., 2008. Global production networks: Realizing the
potential. Journal of Economic Geography. 8 (3), 271–295.
Couto, V., Mani, M., Seghal, V., Lewin, A., Manning, S. and Russel, J., 2007. Offshoring
2.0: Contracting Knowledge and Innovation to Expand Global Capabilities. Durham:
Duke University CIBER/Booz Allen Hamilton Report.
Dicken, P., 2011. Global Shift: Mapping the Changing Contours of the World Economy. 6th
edition. London: SAGE Publications.
Dossani, R. and Kenney, M., 2007. The next wave of globalization: Relocating service
provision to India. World Development, 35 (5), 772–791.
Dossani, R. and Kenney, M., 2009. Service provision for the global economy: The evolving
India story. Review of Policy Research, 26 (1–2), 77–104.
Eltschinger, C., 2007. Source Code China: The New Global Hub of IT Information Tech-
nology Outsourcing. Hoboken, NJ: Wiley.
Fernandez-Stark, K., Bamber, P. and Gereffi, G., 2010. Workforce Development in Chile’s
Offshore Services Value Chain. Center on Globalization, Governance and Competitive-
ness. Durham, NC: Duke University.
Introduction and overview 11
6192 T&F Local impact of Globalisation:Layout 1 9/6/15 10:48 am Page 11

Fernandez-Stark, K., Hernández, R.A., Mulder, N. and Sauvé, P., 2014. Introduction. In: R.
A. Hernández, N. Mulder, K. Fernandez-Stark, P. Sauvé, D. López Giral and F. Muñoz
Navia, (eds). Latin America’s Emergence in Global Services. A new driver of structural
change in the region? Santiago, Chile: United Nations publication, 13–37.
Freeman, R., 2005. Does Globalization of the Scientific/engineering Workforce Threaten
US Economic Leadership? NBER working paper 11457, June.
Fröbel, F., Heinrichs, J. and Kreye, O., 1980. The New International Division of Labour.
Cambridge: Cambridge University Press.
Fuller, C.J. and Narasimhan, H., 2007. Information technology professionals and the new-
rich middle class in Chennai Madras. Modern Asian Studies, 41 (1), 121–150.
Gereffi, G. and Fernandez-Stark, K., 2010. The Offshore Services Global Value Chain. North
Carolina: CORFO-Report, Center on Globalization, Governance and Competitiveness.
Durham, NC: Duke University.
Ghani, E. and O’Connell, S.D., 2014. Can Service Be a Growth Escalator in Low Income
Countries? World Bank Policy Research Working Paper 6971, Washington, DC: World
Bank.
Graham, M. and Mann, L., 2013. Imagining a silicon savannah? Technological and concept-
ual connectivity in Kenya’s BPO and software development sectors. The Electronic
Journal of Information Systems in Developing Countries, 56 (2), 1–19.
James, A. and Vira, B., 2012. Labour geographies of India’s new service economy. Journal
of Economic Geography, 12 (4), 841–875.
IBPAP (IT and Business Processing Association of the Philippines), 2012. 2012–2016
Philippine Information Technology and Business Process Management IT-BPM
Roadmap. Makati City: IT and Business Processing Association of the Philippines.
Kleibert, J.M., 2014. Strategic coupling in ‘next-wave cities’: Local institutional actors and
the offshore service sector in the Philippines. Singapore Journal of Tropical Geography,
35 (2), 245–260.
Kleibert, J.M., 2015. Industry-academe linkages in the Philippines: Embedding foreign
investors, capturing institutions? Geoforum, 59 (2), 109–118.
Kobayashi-Hillary, M. (ed.) 2008. Building a Future with BRICs. The Next Decade for
Offshoring. Berlin: Springer.
Levy, F. and Murnane R.J., 2005. The New Division of Labor: How ComputersAre Creating
the Next Job Market. Princeton: Princeton University Press.
MacKinnon, D., 2012. Beyond strategic coupling: Reassessing the firm-region nexus in
global production networks. Journal of Economic Geography, 12 (1), 227–245.
Massini, S. and Miozzo, M., 2012. Outsourcing and offshoring of business services:
Challenges to theory, management and geography of innovation. Regional Studies, 46
(9), 1219–1242.
Metters, R. and Verma, R., 2008. The history of offshoring knowledge services. Journal of
Operations Management, 26, 141–147.
Milberg, W. and Winkler, D., 2013. Outsourcing Economics: Global Value Chains in
Capitalist Development. Cambridge: Cambridge University Press.
Murphy, J., 2011. Indian call centre workers: Vanguard of a global middle class? Work,
Employment and Society, 25 (3), 417–433.
NASSCOM (National Association of Software and Services Companies), 2014. The IT-
BPM Sector in India,Strategic Review 2014, New Delhi: NASSCOM.
Ofreneo, R.E., Ng, C. and Marasigan-Pasumbal, L., 2007. Voice for the voice workers:
Addressing the IR concerns in the call center/BPO industry of Asia. Indian Journal of
Industrial Relations, 42 (4), 534–557.
12 Bart Lambregts, Niels Beerepoot and Robert C. Kloosterman
6192 T&F Local impact of Globalisation:Layout 1 9/6/15 10:48 am Page 12

Rodrik, D., 2014. October 13. Are services the new manufactures? Online: www.project-
syndicate.org/commentary/are-services-the-new-manufactures-by-dani-rodrik-2014-10
Rubalcaba, L., 2007. The New Service Economy: Challenges and Policy Implications for
Europe. Cheltenham: Edward Elgar.
Taylor, P. and Bain, P., 2005. India calling to the far away towns. Work, Employment and
Society, 19, 261–282.
Tholons, 2014. 2014 Tholons Top 100 Outsourcing Destinations: Regional Overview.
Online: www.tholons.com/TholonsTop100/pdf/Tholons_Top_100_2014_Rankings_and_
Report_Overview.pdf
UNCTAD (United Nations Conference on Trade and Development), 2005. World investment
Report: The shift Towards Services. New York: United Nations Conference on Trade and
Development.
UNESCAP (United Nations Economic and Social Commission for Asia and the Pacific),
2011. Asia-Pacific Trade and Investment Report 2011. Post-crisis trade and investment
opportunities. New York: United Nations Economic and Social Commission for Asia
and the Pacific.
World Bank, 2007. Global Economic Prospects: Managing the Next Wave in Globalization.
Washington, DC: The World Bank
World Bank, 2009. World Development Report 2009: Reshaping Economic Geography.
Washington, DC: The World Bank.
World Bank, 2011. Global Development Horizons 2011. Multipolarity: The New Global
Economy. Washington, DC: The World Bank.
World Bank, 2012. Exporting Services: A Developing Country Perspective. Washington,
DC: The World Bank.
World Bank, 2013. Philippine Economic Update: Accelerating Reforms to Meet the Job
Challenge. World Bank: Poverty Reduction and Economic Management Unit East Asia
and Pacific Region. Online: www.worldbank.org/content/dam/Worldbank/document/
EAP/Philippines/Philippine_Economic_Update_May2013.pdf.
Introduction and overview 13
6192 T&F Local impact of Globalisation:Layout 1 9/6/15 10:48 am Page 13