The labour market is seeing a reverse trend in outsourcing work to freelancers in developed nations, to get a foothold in the local market as well as increasing the profit margins for the companies, reported CNBC.

Share Market Live

NSE

Traditionally, companies used to hire labours in the markets which offered low labour costs. However, companies are hiring freelancers in the developed markets it serves as the workers have knowledge about local culture, help gain a competitive advantage and increase the profitability of the company. The demand is on the rise, the report said.

According to a report by Freelancer.com, a global freelance platform based in Sydney, developing nations such as Argentina (17.49 percent), Mexico (10.76 percent), China (10.3 percent), Pakistan (8.05 percent) and India (7.45 percent) are outsourcing work assignments to freelancers in developed nations including US, Europe and Canda, the report said.

Hiring local talents in developed nations requires training and skill development. However, they are not as fast as their peers in the developed nations, which could downsize the operation to few people and increase the efficiency, the report added.

After India and Bangladesh, US is the third market in the world for freelancing. Companies, to build their business are hiring Americans either on a full-time or contract basis. This means that they are stretching on their salary budgets well beyond to what they usually pay, the report said.

Alex Wood, a researcher at the Oxford Internet Institute, has for instance, interviewed American freelancers in Los Angeles who were doing business development for a software company in India that needed help navigating the US market. Wood has found that companies made up of highly skilled workers in developing economies such as India may face cultural barriers when they want to break into markets such as the United States. “In many cases the benefits of adding a US freelancer to help you with the US side of the business is going to be a bigger market there,” Wood said, as reported by CNBC.

First Published:Jul 26, 2018 10:52 PM IST