Geography Reference
In-Depth Information
liability, keeping insurance rates low, and protecting assets (both legal and other-
wise) from public scrutiny through deliberately impenetrable webs of cross-own-
ership that typically deflect even the most dogged of auditors. Thus, despite the
putatively aspatial nature of electronic money and the extreme fungibility of elec-
tronic financial capital, place still matters in the geography of offshore banking in the
forms of locally embedded local policies.
4.4 Back Office and Call Center Relocations
Few domains of economic activity have been as heavily affected by telecommu-
nications as low level, routinized back office functions, which currently employ
about 250,000 people in the U.S. Back offices perform clerical functions such as
data entry of office records, telephone books, or library catalogues, stock transfers,
payroll or billing information, bank checks, insurance claims, and magazine
subscriptions. These tasks involve unskilled or semi-skilled labor, primarily
women, and frequently operate on a 24-hour-per-day basis. Back offices have few
of the interfirm linkages associated with headquarters activities and require
extensive data processing facilities, reliable sources of electricity, and sophisti-
cated telecommunications networks.
Historically, back offices have located adjacent to headquarters activities in
downtown areas to insure close management supervision and rapid turnaround of
information. However, under the impetus of rising central city rents and shortages
of sufficiently qualified (i.e., computer literate) labor, many service firms began to
uncouple their headquarters and back office functions, moving the latter out of the
downtown to cheaper locations on the urban periphery. Most back office reloca-
tions, therefore, have been to suburbs; 95 % of all relocations of data entry jobs are
within metropolitan areas.
Recently, given the increasing locational flexibility afforded by satellites and
inter-urban fiber optics systems, back offices have begun to relocate on a much
broader, continental scale. Under the impetus of new telecommunications systems,
many clerical tasks have become increasingly footloose and susceptible to spatial
variations in production costs. Digital call distribution systems have made possible
the relocation of phone services that were once confined to centralized locations.
Many financial and insurance firms and airlines moved their back offices from New
York, San Francisco, and Los Angeles to low wage communities in the Midwest and
South. Phoenix, Atlanta, and Kansas City are examples of particularly significant
beneficiaries of this growth. Omaha, Nebraska, claims to have created 100,000 tele-
generated jobs in the last decade, in part because of its location at the crossroads of
the national fiber optic infrastructure (Richardson and Belt 2002 ). Similarly, with
abundant cheap labor, San Antonio and Wilmington, Delaware have become well-
known centers of telemarketing. Boulder, Colorado and Columbus, Ohio have
moved in much the same direction, in part because their centralized geographic
location gave them advantages during the era of banded WATS service.
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