Call Center Comeback Could Be Springboard for IT Boom

Suspended from the ceiling are two big traffic lights. Yellow's lit, meaning call volume is high enough that workers should ask before taking a break. Green means just go, red means don't even think about it.

It's a call center, and scenes like this one happen all over the state of Maine each day. Maine has had a strong call center presence since the 1990s, when Talk America was the darling of downtown Portland and MBNA employed thousands throughout the state.

Big employers like Talk America and MBNA either folded or vastly decreased their presence in Maine, and call center jobs followed suit. In 2000, the high-water mark for call center jobs, Maine had about 9,700 people employed in the field. In the third quarter of 2007, there were about 6,000. Those numbers from the Maine Department of Labor are fairly general -- there's not a statistical category for call center jobs, so the agency keeps track of them through media reports and other means.

What Downturn?

However, at least anecdotally, it appears call center jobs are growing in Maine -- even in what's supposed to be a cooling economy. ListenUp, for instance, was founded in 2004 and has 150 employees. It recently moved from Scarborough into bigger space, and plans to double its work force by year-end.

"I'm not aware of the economy going down," President Dave Twomey said.

Various call center companies have either opened shop in Maine or announced plans to expand in recent months. The majority are in- bound centers. They aren't telemarketers cold-calling potential customers, but rather are getting calls for advertised products, services , or other offers.

Some of the companies include the following:

• London-based Barclays plans to bring 50 full-time jobs with benefits to its new call center in Wilton and possibly another 150 over the next 10 years.
• CenterPoint Teleservices, a call center based in Eliot, was formed in February and has 160 employees. By the end of the year, the company could employ 250.
• Acrobat Research of Toronto opened a call center in Calais at the end of January, and now employs roughly 100 people there.
• North Carolina-based Global Contact Services opened a new call center in Pittsfield, employing 200 people.

There's a number of reasons for both the growth in call centers, and for the fact that it's happening in Maine.

Through the last five years or so, many call center contracts have migrated to other countries. But that trend seems to be reversing itself, to a degree, experts said.

Outsourcing Resistance

Bob Heiser, assistant professor of marketing at the University of Southern Maine, said some companies have realized that there are some call center functions that are "context sensitive." Consumers expect the person on the phone to be aware of local economic and social conditions.

"I think companies are realizing some [functions] cannot be contracted out across the pond, whichever way it goes -- to the east or west," said Heiser.

Michael McNaboe, chief executive officer at CenterPoint in Eliot, said companies that offshored their call center contracts "quickly recognized that the service levels were not there, the performance was not there. I think there was a cultural disconnect between somebody from mid-America calling India or Pakistan or the Philippines or somewhere like that," said McNaboe.

There are cultural nuances, said McNaboe, that can either help a call center worker make a sale or lose a sale.

McNaboe said "boutique" call centers like CenterPoint and ListenUp have found that having a facility that seats about 150 is a sweet spot for performance. A company can have about 400 salespeople working different shifts around the clock, he said. It's harder to manage sales performance with bigger work forces, he said, with thousands of salespeople.

"It's like herding cats, it's hard to get your arms around that type of sales force," McNaboe said.

Help From Faltering Economy

However, thanks to technological advances in the telecommunications world, boutiques can now band together to go after and share large sales campaign contracts, competing with much larger call centers, said McNaboe.

"We can put together 450 or 500 seats in four different boutique locations where the sale performance is going to be top-notch," McNaboe said. "The technology wasn't there five years ago for us to be able to do that effectively."

Greg Alcorn, president and chief executive officer at Global Contact, said the faltering economy is helping his business. Global Contact handles services ranging from sales to customer service for companies in the fields of insurance, finance, telecommunications and others. Companies find it is less expensive to contract with his company to do these services telephonically, rather than provide them at physical locations like branches, he said. And the growth of the Web has made consumers more comfortable with that trend, he said.

As to why Maine, Twomey, of ListenUp, said that companies like Talk America and MBNA essentially trained a work force in telephone sales and customer service. So the workers are here, he said.

And a number of executives -- including Twomey and McNaboe -- worked at Talk America.

Matt Jacobson, president and CEO of Maine & Co., which works to attract businesses to the state, said call center companies tend to find there's not a lot of turnover in their work force. That's because there's not a lot of competition from other similar companies, and also because there's not a lot of employment options, particularly in rural areas, Jacobson said.

Maine's labor market is also more attractive for businesses.

"The same job in New York would be 25 bucks an hour," Jacobson said. "Up here, it's 12 to 15."

John Richardson, Maine's commissioner of economic and community development, said that information technology companies, overall, are taking a regional approach toward the recruitment of work forces and ignoring state borders as they consider expansion. So the dominance of Boston in the IT world is challenged because of both property values and competition for human capital, he said.

'No Such Thing as a Bad Job'

Call center jobs are sometimes pooh-poohed as low-quality. But they generally offer an hourly wage, plus sales commission. People at ListenUp earn between US$15 and $20 an hour, Twomey said.

"To me, there's no such thing as a bad job if it pays benefits and a decent wage. It comes down to labor demographics and building an economy out of different jobs," Jacobson said. "Clearly there are people who like working for these companies. So long as we have a work force willing to support them, I don't see a downside."

Richardson said call center jobs were valuable, but are only a beginning. Governor John Baldacci's plan is to create an IT cluster to attract more technologically advanced jobs to Maine. The state is working with a national IT trade association and the National Governors' Association to use a $2 million U.S. Department of Labor grant to build that cluster, Richardson said. Richardson said Baldacci wants to explore an informal summit with the heads of IT-based companies that have moved to Maine to talk about ways to develop the work force to attract future, advanced technology companies.

"Call center jobs are fine jobs, but that's not the end game here," said Richardson. "The end game strategy is to create a cluster of IT."