When offshoring to the Philippines became a popular solution of large service companies in North America and Europe in the early 2000s, the reaction of business workers were a mix of appraisals and criticism.   For the most part, regardless of the result of outsourcing U.S. or European labor was not well received, the model was effective for investors and business owners.  They saw the value of paying lower wages without the employment liability risks versus higher wage with employment lawsuit exposure.

Offshoring creates a considerable amount of positive outcomes and benefits to the global economy.  Businesses can dramatically reduce costs and improve their competitive position and the economy can generate more output.  Although the sensitivity of outsourcing means a loss of thousands of jobs, the solution generates a large surplus for the business which will ultimately continue to help the global market.

To justify a company’s decision to outsource an office function, here’s what we need to analyze:

How Much Does an Employee Cost?

Let’s take the average salary of a Sr. Accountant (not a CPA) earning $70,000.

The average employee cost is 1.25 times the base salary. The 25% over base salary is the additional expenses that the company’s pay per employee. Additional expenses that many common workers don’t realize are costs of liability insurance such as Workman Comp and Employment Practice, Payroll taxes which include unemployment taxes, Social Security, Medicare, etc..  Companies also pay for health benefits and retirement contributions.

Employee costs are more than what most of us think.  As shown above, $70,000 is not the true cost of an employee. It’s a lot more.  So, if you have an Annual Budget of $70,000 for a Sr. Accountant, that means you can expect to pay about $87,000 in total.

With MCVO Talent Resource Services, your outsourcing costs can start as low as $9.00 per hour and this is all-inclusive of health insurance and payroll taxes.  It’s real and there’s no catch.  The best part is that the offshoring solution limits your company to any employment liabilities.  We take the risk off your hands.