Call Centres Returning to England

UK businesses are increasingly reshoring call-centre and distribution roles from overseas. This shift reverses a two-decade offshoring trend driven by rising costs abroad, customer dissatisfaction, and changing economic priorities. But is this reshoring wave real, and what benefits could it bring for the workers of England?

Overseas Offshoring: The Prior High-Water Mark

From the early 2000s, major UK firms moved customer service operations to low-cost locations such as India, the Philippines, South Africa, and Eastern Europe—often halving labour expenses. However, hidden costs arose: high attrition rates (up to 75% offshore vs. ~12% in the UK), cultural misalignment, recruitment and training burdens, and declining customer satisfaction. These factors have eroded the financial justification for offshoring and spurred the trend back to domestic centres. Learn more about call centres returning to England.

Companies Alleged to Be Bringing Jobs Back

• BT / EE pledged to handle all consumer calls from the UK (and Ireland) by 2020, reporting improved satisfaction after reshoring.
• Powergen closed its Indian operation, creating 980 domestic jobs.
• Santander moved its Bombay centre to Burnley, hiring 500 UK staff for 1.5 million calls.
• Shop Direct (GUS) shut its Bangalore facility, returning 250 roles to the UK.
• Others include Nationwide, Legal & General, RBS, Co-operative Bank, Aviva, Abbey, New Call Telecom, and RSA.

Recent Data & Context

Most reversals occurred between 2004 and 2018, but the trend persists. By 2011, a UK telecom provider noted labour-cost parity between India and the UK. The COVID-19 pandemic further highlighted supply-chain risks and prompted a shift toward “nearshoring.”

What This Means for the Economy

1. Job Creation & Tax Revenue

Reshoring generates domestic roles, boosts incomes, and increases tax receipts. Each relocated position could yield an extra £7k–10k annually in income tax and National Insurance. With hundreds of jobs repatriated, public revenues could rise by tens of millions.

2. Consumer Satisfaction & Brand Value

Local service enhances customer experience. Santander and BT reported measurable improvements in satisfaction metrics after reshoring, translating into higher loyalty, reduced churn, and increased lifetime customer value.

3. Hidden Cost Reduction

UK call centres benefit from lower staff turnover, cutting recruitment and training expenses. Handling times also decrease: one UK telecom firm observed an average call duration of 3 minutes domestically versus 4 minutes offshore, supported by higher customer satisfaction scores.

4. Local Economic Boost

Domestic roles stimulate local economies, spurring demand for housing, retail, and services. Cities like Glasgow and Lancaster have repurposed commercial real estate into call-centre hubs, revitalising regional employment.

5. Strategic Resilience

Domestic call centres offer greater operational stability than overseas facilities, especially during global disruptions like the pandemic.

Could Companies Be Taxed More for Offshoring?

The concept of an “outsourcing levy” on offshoring has been debated, but no current UK law imposes such penalties. Instead, governments may prefer positive incentives: tax credits, wage subsidies, apprenticeship grants, and R&D credits tied to location-based jobs. These carrots are often more politically feasible than sticks and have been trialled post-Brexit to attract investment.

Precedents from Elsewhere

France’s PACTE law (2019) and Italy’s regional incentives reward firms that repatriate services. In the U.S., state-level tax credits support reshoring manufacturing and tech support roles. The Workers of England Union (WEU) advocates similar measures for England to maximise the benefits of returning call-centre jobs.

Has It Worked Elsewhere?

United States & Continental Europe

President Trump’s Onshoring Initiative and various state schemes have brought back manufacturing and tech support roles from Mexico and Asia, with mixed but notable successes. Call-centre projects have similarly returned under public incentives.

Lessons Learned

• Quality over cost: Offshoring savings often vanish due to high attrition and training costs.
• Public pressure matters: Consumer backlash against offshore centres drives corporate reversals.
• Balanced approach: Combining incentives and penalties yields the most sustainable reshoring results.

Conclusion: A Strategic Opportunity for England

The return of call-centre jobs to England responds to rising offshore costs, staff turnover, and pandemic disruptions. Reshoring offers clear advantages:

• For companies: improved efficiency, customer satisfaction, and brand trust.
• For workers: increased job opportunities and stability.
• For government: higher tax revenues and economic growth.

While taxing offshoring may prove politically challenging, targeted incentives have demonstrated effectiveness. The WEU urges the UK government to champion reshoring initiatives as a pathway to a more resilient, locally grounded economy.