Encouraging Onshoring: FCC’s Call Center Proposals Explained

The Federal Communications Commission is seeking public comment on proposals that could encourage US companies to bring call center jobs back from offshore hubs such as India and the Philippines, a move that could threaten major outsourcing industries in both countries.

The proposal, adopted Thursday through a Notice of Proposed Rulemaking, is part of a broader US push to shift more customer service operations back home while addressing concerns over service quality, data protection and foreign-based scam activity.

The FCC said many American corporations have moved customer service and call center operations overseas over the past several decades, with nearly 70% of US companies now outsourcing at least one department.

The agency is asking the public to weigh in on ways to encourage and facilitate the onshoring of call centers and to identify measures that could improve customer service and strengthen data security.

It is also seeking input on how to curb illegal robocall scams that it said originate from foreign call centers.

Among the proposals under review is allowing consumers to request that a call be transferred to a US-based service center.

The FCC is also considering whether calls involving certain types of sensitive information should be handled only within the United States.

Another proposal would require companies covered by the rules to disclose the location of the call center during customer interactions.

The commission is also exploring whether providers should be required to tell consumers how extensively they use US-based call centers.

In addition, the FCC is seeking views on whether workers serving US customers should be proficient in American Standard English and receive appropriate training to resolve customer concerns.

The initiative could carry major implications for India’s business process outsourcing sector, which is worth billions of dollars and employs hundreds of thousands of workers.

The Philippines, India, Colombia and South Africa remain among the leading destinations for US companies outsourcing customer service and call center jobs.

Any effort to shift those operations back to the US would likely come with significantly higher operating costs for businesses.

Industry benchmarks show that customer service agents in the United States typically earn three to five times more than offshore workers performing similar roles.

Domestic call center operations in the US also face higher compliance and real estate costs, adding to the expense of onshoring.

Those additional costs could eventually be passed on to consumers.

The FCC’s move follows a broader political effort in Washington to discourage offshoring of customer service work.

Last year, a bipartisan group of US senators introduced the Keep Call Centers in America Act, which seeks to discourage companies from moving customer service jobs overseas or replacing live agents with artificial intelligence.