Australia’s outsourcing industry set to suffer in 2020, says consultancy

More than 50 global outsourcing companies are expected to close in 2020 in what the Australian Government is warning could be the final nail in the coffin of Australia’s global outsourcing industry.

Key points:Australia’s outsourcing sector could face a major blow from the federal government’s cuts to the sectorSource: News24 Australia’s International Development Council has warned of “catastrophic” job lossesSource: Al Jazeera’s Mark Pendergast”The Australian Government’s decision to scale back the growth of the industry is causing serious concern in the industry, and could have catastrophic impacts for Australia’s future,” the Council’s executive director, Stephen Fung, said in a statement.

“While we recognise that Australia’s international reputation is not as well-known in the world as its reputation for innovation, it’s important to remember that we are a global hub for many of the world’s most successful companies and the Australian economy depends on it.”

The Government will reduce the amount of funding available for the industry by about $1.5 billion a year, while slashing the annual rate of pay by 1.5 per cent.

The Government also announced it would close down the Australian International Development Institute, which it says provides “critical services” to Australia’s overseas development programs.

“Australia’s global competitiveness is under serious threat,” Mr Fung said.

“In the next few years, we will be seeing the loss of thousands of jobs and millions of dollars of potential revenue.”

Mr Fung added that the Government’s plan to cut Australia’s budget deficit would mean that “the industry will face a severe blow in the next three to four years”.

Mr Fong said the industry could also see significant job losses from the impact of the federal Government’s planned cut in funding.

“These jobs will be lost because they are already being outsourced, or are currently outsourced and are not considered to be vital to Australia and its economy,” he said.’

Australia’s international image will be damaged’Australia has the second largest international outsourcing industry in the developed world behind China, according to the report.

“We’re very concerned about the impacts of cuts to international development funding that will have a devastating impact on the Australian domestic and global image, and will hurt Australia’s ability to attract the investment needed to build a new industry here,” the report said.

Australia’s foreign direct investment (FDI) is expected to decline by about 20 per cent by 2020.”FDI in Australia has been on a steady decline for many years, and the Government has cut funding for Australia by about 40 per cent over the past decade, and it is a serious threat to Australia,” the IEDC said in the statement.

According to the Government, foreign direct investments have been the source of more than $2.8 trillion in Australian investment since 2000, while Australia’s trade deficit with China is now more than half a trillion dollars.

The IEDc’s analysis also warned that the loss in the IEEI would have an “immediate and significant” impact on Australia’s economy.

The report also warned Australia’s industry could see job losses of up to 70,000 jobs and that it could also face major job losses due to the impact on its business model.

“The loss of this business model could be catastrophic for Australia, with the loss leading to job losses for Australians across the economy, and potentially further damaging Australia’s position in the global race to innovate,” it said.

The Australian Industry Group (AIG) has previously warned that Australia could lose an estimated $15 billion to $25 billion in the first half of 2020 from the government’s budget cuts.

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