Pakistan continues to be one of the top choices for businesses looking to offload their internal processes, and it doesn’t seem like that is going to be changing anytime soon. Companies such as Uber, Western Union, Bentley, VMWare, and more are all looking to increase their footprint in Pakistan. While lower costs tend to be a major factor, many other benefits come into play as well.
Whether you’re planning on outsourcing customer service and technical support roles, or lead generation, software development, or virtual reception and scheduling, Pakistan is an excellent choice. Outsourcing in Pakistan can help your business:
- Immediately access and leverage new skills
- Save time
- Reduce costs
- Innovate
- Improve quality
Here are 11 reasons why Pakistan is the goldilocks of outsourcing:
1. Cost-Effectiveness
According to the Bureau of Labor Statistics, the median annual compensation in the U.S. in 2022 was around $54,132 – of course, this depends on a lot of factors such as educational qualifications, experience level, and city of residence.
In Pakistan, however, the median annual compensation is almost one fifth of that in the United States. On the low end, a customer service representative may make anywhere from $12-15 per hour in the U.S., whereas an equivalent in Pakistan would be closer to $8 per hour; a software engineering role can cost upwards of $70,000 a year (or more!), while the same role will only cost you about $12/hour in Pakistan – with the same, if not better results.
Note that the compensation for Pakistani-equivalent roles is on the higher end, so you’re getting 2x the experience at less than 50% of the cost.
Lower HR Costs
Not only are salaries lower in Pakistan, but the overhead costs associated with hiring, recruiting and onboarding employees are much lower, too. While the average cost to hire an employee is $4,000 in the U.S., it is considerably lower in Pakistan – averaging only around $500-$1,000.
Employee training can also cost thousands of dollars in the U.S., but only a small fraction of that in Pakistan. In addition, you can also get by with lower bonuses and incentives due to lower cost of living.
Cheaper Insurance
Pakistan’s government constantly takes steps to make quality healthcare accessible to everyone. Close-to-free medical assistance is offered in government hospitals, and private hospitals don’t cost that much either.
Even Pakistan’s top private hospitals are far cheaper than mid-tier hospitals in the U.S. and offer similar facilities. So, even if you offer health insurance at a private hospital like PIMS (one of the best hospitals in Pakistan), that is going to cost you a fraction of what it would in the United States.
Business-Friendly Government
The IT sector is seeing a boom in Pakistan, and the Government of Pakistan is doing its best to improve IT exports. From tax incentives to a 0% tax on foreign remittances (no matter how large the amount), the government is doing everything it can to promote the growth of the IT sector.
Even on earnings in the IT sector, the tax is close to none – only 0.25% of the revenue. Compare this tax to that in the U.S., and the taxes alone save you $1,000s per employee per quarter. With a handful of employees, that’s more than $100,000 saved in taxes – the legal way.
“Why are Pakistanis so cheap?”
Lower salaries do not necessarily imply low performance. The cost of living in Pakistan is much lower compared to other countries. According to the World Population Review, Pakistan is the second cheapest country to live in in the world.
Salaries on the lower end in the U.S. fall in the medium to the higher-end spectrum in Pakistan. So, from their perspective, they are making more than a fair wage. A lower-end salary is only “cheap” when the cost of living is compared to that of the U.S.
2. Unparalleled Problem-Solving Skills
Pakistan is a third-world country which means there are plenty of problems that go on every day. Growing up in such conditions develops excellent problem-solving abilities and grit in Pakistanis. In local language, Pakistanis are “jugaadu” – which translates to being able to solve any problem.
This problem-solving ability translates excellently into their professional life, too. Whether the need of the hour is to be quick on one’s feet or to make a calculated, rational decision, these guys can smell it from an hour away and react accordingly!
Manager not available, but an urgent issue needs to be resolved? Consider it done. Software engineer can’t debug code in a different language than they are used to? You better bet that they’ll be calling a friend that knows the language to get it resolved ASAP. If you’re looking for something beyond repetitive tasks, give these guys a shot! You won’t be disappointed.
3. Highly-Educated Workforce
In the 21st century, skills do matter, but they’re certainly not the only thing that matters – education’s importance cannot be neglected. The Government of Pakistan gives out generous need-based scholarships to encourage talented and hardworking students to complete their education.
In Pakistan, companies generally do not hire technical people solely on the basis of skills; their educational background is taken into account. This is why you’ll find all the technical people are highly educated – most don’t stop even after a Bachelor’s degree!
4. Flexible Time Zones
Whether you’re in the U.S. EST or CST zone, or fall in the PST zone, you don’t have to worry about not getting constant updates. No matter what time zone you fall in, rest assured that your Pakistani employees will change their sleeping habits to ensure maximum communication.
5. Strong Work Ethic and Productivity
By nature, Pakistanis tend to have a strong work ethic and are fairly motivated (this is just an opinion, not a fact, though). Once they’ve been given the right training, you won’t have to oversee them 24/7.
This productivity can be further enhanced by using proper SOPs and systems. You can learn more about different SOPs used in customer service here.
Interested in receiving a free PDF report of the 4 surprisingly simple SOPs that save our clients 20+ hours per week? Download it here.
6. Fierce Competition
64% of Pakistan’s population is younger than 30 years of age, and 29% between 15 to 29 years of age according to the United Nations Human Development Reports. This high of a percentage means there’s a lot of potential to crack into.
With the total population being around 231.4 million (as of 2021), there’s a lot of competition. There’s not a lot of monopolization in the IT sector, so there’s a large pool of talent to choose from.
The country is currently seeing a boom in exporting IT services, and more and more talented people are inclining towards IT, so the competition is only going to get tougher – that means better services, lower pricing, and more innovation.
7. Excellent Communication Skills
Pakistanis have excellent English-speaking skills. With some practice, these guys and girls can easily reach the proficiency level of a native speaker. For customer service or technical support roles, you don’t have to worry about your customers not being able to understand the representatives.
Even if their accent is not native (which will often be the case), their speech will still be clear and easy to understand. More often than not, your customers won’t even realize they’re speaking to someone who wouldn’t live next door to them.
8. Exposure
More Pakistanis are now getting educated than they ever have thanks to countless scholarships provided by the government under different schemes. More and more cultural exchange programs, webinars, and programs are giving exposure to students.
By the time these students get out of universities, they already have a fair amount of exposure under their belts about how things work in the U.S. and other western countries and how to deal with them. This means less time, money, and resources spent on training them and getting them up to speed.
9. Lower Turn-Over Rates
Job hopping hasn’t currently made its way to Pakistan, so the turn-over rates for Pakistani employees are much lower compared to those of other nationalities. You can expect a turnover rate of around 2-3%, as compared to 6.4% in the United States.
Ultimately, this translates to lower HR costs per employee and employees knowing about your company and work in-depth, leading to increased customer satisfaction, easier communication between departments, and more revenue.
10. Unparalleled Social Skills
Pakistanis are street-smart. They know how to deal with unfamiliar situations. Even with the right training, unknown situations can take employees by the storm – but not these guys! These guys are quick on their feet, and know how to handle almost any situation. If you’re looking for customer support or customer service personnel, these guys are the best ones out there. 200% the customer satisfaction at 50% the price – definitely something worth looking into!
11. State-of-the-Art Technology Parks
Currently, more than 15 technology parks are operating under the government in Pakistan. These technology parks provide state-of-the-art facilities to encourage IT exports. So, whether you require an ultra high-end internet connection or anything else, these parks have got your back.
These “parks” are really affordable, and you can offer your employees membership to these parks to boost productivity. They cost close to nothing (since they’re maintained by the government), and you can get a lot out of them. Excellent incentives.
Another benefit of these technology parks is that your employees will meet amazing, talented people, and you can onboard these people onto your team later on.
Conclusion
Outsourcing to Pakistan can save you up tens of thousands per year in salaries, taxes, and overhead. The cost of living is one of the lowest in the world, so compensation on the lower end in the U.S. falls on the higher end of the spectrum there.
The country is currently seeing a boom in the IT sector, and the government is introducing policies to encourage IT exports – from a 0% tax on foreign remittances to investing in state-of-the-art science and technology parks.
Pakistanis have above-average English-speaking skills, so they’re perfect for customer service and technical support roles. Interested in potentially saving thousands of dollars annually? Get in touch with us so we can walk through your requirements and see if outsourcing to Pakistan is a good fit for your business.