The Argument
Why It Matters
Companies say offshoring cuts costs, improves service, and keeps them competitive. The Australian evidence tells a different story. Service declines. The savings go to shareholders, not consumers. And the broader economy loses more than it gains.
How offshoring works
Companies use different models to move work overseas. The language is deliberately opaque.
GCC (Global Capability Centre)
A company-owned office in a low-cost country, staffed with workers who do the same work as Australian employees at a fraction of the wage. ANZ has 13,740+ in India. Worley delivered 8.3 million hours through GCCs in India and Colombia. REA Group named theirs “REA Cyber City.”
BPO (Business Process Outsourcing)
Back-office work — data entry, accounts, customer service — run by a third-party vendor in another country. Suncorp has 4,500 offshore BPO partner employees. QBE has 2,383 in a Philippines shared services centre.
Managed Services
A vendor takes over an entire function — IT, call centres, payroll — and runs it from offshore. Telstra outsourced 442 roles to Infosys. Wesfarmers Health brought in TCS to shadow and replace staff.
Shared Services Centre
A centralised operation handling finance, HR, or IT for the whole company. Sounds domestic but often located in India, Philippines, or Malaysia. Computershare, Orica, and Elders all run shared services offshore.
Offshore Consulting / Body Shops
Large consulting firms like Accenture, Infosys, TCS, and Cognizant win contracts with Australian companies then deliver most of the work from India or the Philippines. An “Australian” contract may have 80-85% of the team offshore with only 2-3 people onshore for client management. Telstra's Tech Mahindra contract shows 13,000+ Indian job listings for Telstra work.
Global Integrated Delivery
Engineering and professional services firms use this term to describe work done in India that supports projects anywhere in the world. Worley's CEO thanked their “globally connected team.” The work is in India. The profits are in Australia.
Does offshoring improve service?
There are no strong Australian examples where offshoring led to a clear, sustained improvement in service quality. The pattern is the opposite.
Offshored call centres heavily. Customer satisfaction and complaint volumes worsened over years. Later invested in bringing roles back onshore. Service improved after partial reversal — not because of offshoring.
Similar offshore support model. Persistent customer frustration. Repeated attempts to fix via scripts, tooling, and restructuring. No evidence of service uplift from offshoring.
Offshored operations and some tech. Maintained strong customer experience by keeping frontline and critical journeys onshore. Digital improvements came from platform investment, not offshoring.
Offshore centres improved back-office processing speed. Limited customer-facing exposure. Improvement was in internal SLAs, not customer experience.
The only narrow “yes” cases
In specific, limited scenarios, service metrics can improve — but the improvement is availability or speed, not quality.
24/7 coverage
Offshore teams can provide round-the-clock support for fraud monitoring and basic technical queries. The improvement is availability, not quality.
Back-office turnaround
Standardised processes — claims, settlements, verifications — can be processed faster via scale and follow-the-sun workflows. The improvement is speed of completion, not interaction quality.
Why service rarely improves
Context loss
Offshore teams lack local regulatory nuance, customer expectations, and product history — leading to script-driven, low-quality interactions.
Fragmentation
Work split across geographies creates more handoffs. Customers experience repetition and delays.
Incentive mismatch
Vendors are optimised for cost per ticket and throughput — not first-contact resolution or customer satisfaction.
What actually improves service
Where Australian companies have genuinely improved service, the driver is investment — not labour arbitrage.
- Better product design — self-service portals and apps
- Simplification of processes
- Strong onshore ownership of customer journeys
- High-quality tooling for support staff
If the bar is “did customers have a better experience because work moved offshore,” the answer in the Australian context is effectively no.
Net effect on Australia's economy
Generally neutral to mildly negative overall. Gains concentrate in company profits. Losses concentrate in wages, tax base, and local economic activity.
Where companies gain
Lower labour costs improve margins. Shareholders — including super funds — benefit.
In theory, savings could lower prices. In practice, oligopolies (banks, telcos) retain savings as margin.
Helps Australian firms compete with global peers in banking, airlines, and tech-enabled services.
Where Australia loses
Salaries no longer paid in Australia. Reduced household spending, lower income tax receipts, weaker middle-class job base.
Money paid to an Australian worker circulates locally — housing, food, services. Offshore wages leave the economy immediately.
Loss of domestic expertise in operations, customer service, and mid-tier tech. Harder to rebuild over time.
Offshore workers don't pay Australian income tax. Higher corporate profits are often offset by transfer pricing and global cost allocation.
Where the savings actually go
For offshoring to be net positive, savings need to be reinvested domestically into higher-value work, innovation, or new industries. That's not what typically happens.
Shareholder returns
The primary destination. Dividends flow to shareholders, including superannuation funds — but also to foreign owners.
Margin protection
Offshoring often offsets rising domestic wages, regulatory costs, and legacy system inefficiencies. It maintains profitability rather than creating surplus for reinvestment.
Short-term performance metrics
Executive incentives are tied to cost-to-income ratio and EBIT growth. These structurally favour returning capital over long-term reinvestment.
Why it rarely goes into R&D or local hiring
- Australia's dominant sectors — banking, mining, telcos — are not R&D-intensive. They compete on efficiency, not innovation.
- In concentrated markets, firms don't need to aggressively innovate or improve service. Savings can be retained without losing customers.
- Returning capital to shareholders is predictable. R&D and new ventures are uncertain. Capital flows to certainty.
- Even when profits rise, foreign ownership captures part of it. Offshore suppliers capture ongoing spend. Net domestic reinvestment stays low.
The critical distinction
Productive offshoring
Enables a shift to higher-value work domestically. Savings are reinvested into local capability, higher-skill jobs, and product improvement.
Extractive offshoring
Only reduces costs and redistributes income from Australian labour to global labour and capital owners. No offsetting productivity or innovation gain.
In Australia, most implementations lean toward extractive, not transformative. That's what this site documents.
“Everyone does it”
The most common defence of offshoring is that it's industry standard — every major company does it, so what's the problem? That framing treats the current state as inevitable and beyond scrutiny.
The fact that offshoring is widespread doesn't make it good for Australia. Wage theft was once widespread too. So was asbestos. “Everyone does it” is not an argument — it's an excuse to avoid examining who benefits and who loses.
When every major bank, telco, and insurer offshores simultaneously, Australian workers don't just lose one option — they lose all of them. The labour market shifts structurally. Mid-career professionals in IT, operations, and customer service face an economy where the work they used to do is now performed overseas at a fraction of the wage.
This site exists because “everyone does it” is not transparency. It's the absence of it.
What this site is — and isn't
This site tracks where work is performed, not where workers come from. Our concern is economic — when Australian companies and government departments send work offshore, those wages, tax contributions, and skills development leave the Australian economy.
We have no issue with people of any nationality working in Australia. Workers from India, the Philippines, or anywhere else who live, work, and spend their wages here are contributing to the Australian economy. Immigration and offshoring are different issues.
We acknowledge that global operations can reduce costs, and that some of those savings may flow through to consumers. But we believe the trade-offs — Australian job losses, wage suppression, reduced local capability, and the concentration of profits among shareholders — deserve to be visible and understood.
We also recognise that not all offshore operations are the same. A mining company operating a mine in another country is not “offshoring” in the same way as a bank moving its IT department to a low-cost country. We try to distinguish between companies that have genuine international operations and those that are replacing Australian workers to cut costs.
Bottom line
Companies benefit financially from offshoring. Australia as a whole does not clearly benefit, because wage loss and multiplier effects outweigh profit gains.
The economy shifts toward higher capital returns and lower labour share. The only scenario where offshoring becomes clearly positive is when cost savings are reinvested domestically into higher-value industries — and Australia successfully moves up the value chain.
That transition is uneven and not strongly evidenced across most Australian sectors today.
Analysis based on publicly reported outcomes from major Australian companies. Individual company experiences may vary.