Advances in technology will cause a loss of more than 7 million jobs in the world’s biggest economies within the next five years, according to a World Economic Forum (WEF) report released to coincide with its annual meeting in Davos, Switzerland. And because of their low participation in computer and engineering-related fields, women are expected to lose out the most.
But while robotics and smart systems have begun to displace office and administrative professions, some hope to use the same tech revolution to carry job opportunities to those who have been largely excluded from the global economy.
Through platforms like Elance or Upwork (formerly oDesk), many Western tech companies began outsourcing cheap contractors from developing countries to perform data or content-related services remotely. At first glance, the practice seems to justify a familiar local complaint about globalization: Large Western companies send lower-end jobs abroad.
But a number of pioneering social ventures are seeking to turn this new version of corporate outsourcing into a tool to train and connect unemployed youths and women from impoverished regions with dignified and fairly paid jobs from major tech companies.
The model, known as “impact outsourcing,” targets groups that are traditionally the most excluded from work and educational opportunities, giving them the chance to learn core data and online skills currently in demand from large companies and nongovernmental organizations. The skills include data cleaning, content curation, sentiment analysis and picture tagging.
“The demand for these new services is increasing. Some of the companies we work with are the fastest-growing unicorn companies in Silicon Valley,” said Laura Guzman, editorial director of iMerit. One of the “impact outsourcers,” a company with centers across rural areas of India, iMerit has clients that include Microsoft and TripAdvisor. Attracting jobseekers with training in computing skills through its nonprofit sister foundation, Anudip, iMerit then hires those trained.
“The people who come work with us are often coming from families of farmers, or coal miners that were unable to make a very consistent high-quality living,” Guzman explained.
Her employer is one of several computing companies taking advantage of the emerging market in remote online work to benefit underprivileged communities. One, Samasource, employs poor women from developing countries in digital projects for large tech companies. The company has employed several hundred women in northern Namibia to perform digital work for eBay. For many workers, it was their first job, changing their attitudes and positions within their communities.
“Suddenly, they felt part of an economic system, that they had value,” said the company’s founder, Leila Janah, during a WEF panel.
For its promoters, impact outsourcing has a particular appeal as a tool for bringing women into the workforce. The model’s tech focus is seen as having an added benefit: furthering gender advancement in a field that remains heavily male-dominated, even in developed economies. More important for the developing countries where the impact outsourcing companies work is the rippling effect that training women can have. Women who are financially independent not only can serve as an example, encouraging others to enter the labor market, but they also start contributing to the financial ecosystem around them.
“Over time, you see the family starting to see that [the working woman] is more financially independent and that she’s a stronger person outside and inside the workplace,” said Guzman. She recalled how one family, initially hesitant about allowing one daughter to start work, eventually sent their youngest daughter to be trained.
Janah recalled a conversation she had with one participant in a Samasource scheme, who told her, “Paying taxes made me want to work with my local government.”
Both Janah and Guzman want governments to become more actively engaged in supporting the type of freelance work that their companies help promote, and they suggest that the state can assist with skills-development schemes.
Arun Sundararajan, a business professor at New York University focused on technology and labor practices, believes government’s attitude towards freelancers will become increasingly hands-on—“perhaps even serving as an intermediary between the market place and source of talent,” he said in Davos. “The potential for inclusive growth expands dramatically if the government helps excluded populations learn how to manage their reputations, or helps them acquire basic sales, marketing, merchandising and customer services capabilities.”
Sundararajan raises an argument, frequently heard at this year’s WEF, that governments will need to develop a new social safety net, more adapted to an economy based around the flexibility of part-time and project employment of the kind that is particularly associated with online work. But the question of what this safety net should be is under debate, with the growth in freelance work cutting both ways, driven by changing attitudes among workers as well as employers.
“Often, when you dig a little deeper, you realize that freelance contractors who say they want full-time employment, they don’t actually want full-time employment,” said Sundararajan. “They just want the benefits that are associated with it, but they like the flexibility that comes from their form of work.”
While countries like France or Switzerland have started debating the idea of creating a basic guaranteed income for citizens, iMerit relies on more traditional structures to offer its workers financial security and social benefits. It hires full-timers—who receive regular salaries, benefits and sometimes stock options—to perform tasks that normally would be outsourced to freelancers on a project basis.
“In a lot of ways, the outsourcing model does not apply to us, but it’s still a useful shorthand because the jobs that our employees are doing are from large tech companies from Silicon Valley,” Guzman explained.
“It puts a lot of the burden on us, to make sure we always have work. So if a worker is not assigned to a project—which is something we don’t do very often—[they] still come to work and they still get paid,” she adds.
While many of those involved in impact outsourcing would like greater involvement from the state, in many cases their model is the product of a fundamental change that is moving societies toward economies where the state plays a smaller role.
“In Ghana, for instance, up until 30 to 40 years ago, government was the largest employer, so civil service was the largest and the most guaranteed path to professional success”, notes Yawa Hansen-Quao, a regular Davos participant and the founding director of the Leading Ladies’ Network, a women’s leadership development organization from Ghana. Now, Hansen-Quao noted, things are moving very quickly in another direction, with multinational companies penetrating more into developing countries, offering more alternative career paths.
Guzman said she has already seen how directed outsourcing has changed social attitudes in local communities. In India, iMerit’s centers have altered how people in the area around them view women’s relationship to work, with early opposition breaking down as families realize the benefits for themselves financially, but also on those employees’ sense of well-being.
“Where perhaps there was resistance at the beginning, now it’s just seen as a point of pride to have that [IT] center,” said Guzman. “That’s a change in a mindset.”