The Netherlands: Over 30 thousand offshored activitiesStaff Writer | June 29, 2018
In the period 2014-2016, six percent of companies employing more than 50 people moved some of their business operations abroad. Most companies offshored administrative and management tasks.
The Netherlands Most companies offshored administrative and management tasks
More than 500 companies with a workforce exceeding 50 employees offshored one or more of their operations. This occurred much more often in manufacturing (11 percent of companies) than in other sectors (4 percent).
Especially foreign parent companies moved operations abroad relatively often: around 1 in 5. Dutch companies were more place-bound with 3 percent engaging in offshoring of activities.
One in every 100 companies with over 50 employees moved their initially offshored activities back to the Netherlands in the period 2014-2016. This happened twice as often in manufacturing.
In the other sectors, however, backshoring did create more jobs, namely 250, than in manufacturing (130). The main reasons for companies to backshore their activities were insufficient quality of the locally provided products/services and higher costs than expected.
More than 250 companies offshored administrative and management positions, e.g. in finance, accounting and coordination.
Around 220 businesses shifted (a part of) their core activity, production or supply of services to the market.
This included factory jobs, for example, but also design or maintenance jobs for clients.
The highest number of offshored jobs is found in goods manufacturing: nearly 18 thousand. In other words, there were fewer companies offshoring production but it involved more jobs.
Over 6.7 thousand jobs were lost in administration and management and more than 5.2 thousand in services and supporting ICT services combined.
One-quarter of jobs offshored were for highly qualified people. Savings on wage costs were the main reason for companies to move jobs abroad.
Offshoring not only resulted in job losses but also created new jobs. Around 850 new jobs were created in manufacturing while other sectors gained 2.3 thousand new jobs.
Nearly 70 percent of companies engaging in offshoring opted for another EU member state as their destination.
One in five companies transferred activities to India, mainly in the field of administration and management, IT and service delivery.
Aside from Europe, manufacturing companies preferred Oceania and other Asian countries (excluding India or China) for offshoring of production activities. ■