Farmshoring - also called insourcing - describes outsourcing or locating operations in rural areas or smaller, lower cost towns in the US instead of moving them off-shore. The main advantages are lower costs without the cultural, language and time zone issues associated with outsourcing work overseas.
Call centers are a popular example of this trend. But lately even high-end knowledge work is starting to be farmshored. The New York Times has two articles on major law firms hiring associates in smaller cities. Cost reduction is the key driver. The farmshored jobs are not partner track, and they pay about 1/3rd as much as partner track jobs pay.
Key quote from At Well-Paying Law Firms, A Low-Paid Corner:
The nation’s biggest law firms are creating a second tier of workers, stripping pay and prestige from one of the most coveted jobs in the business world.
The salaries for new, partner-track legal associates skyrocketed in the decade preceding the Great Recession. According to the other recent NY Times article on this topic:
From 1997 to 2007, the median starting salary at the nation’s largest firms doubled, to $160,000 a year plus bonus, from $80,000, according to the Association for Legal Career Professionals.
But clients started balking at paying $300 per hour or more for low level legal work done by junior lawyers. Technology is also automating many legal tasks, reducing the need for high priced associates. These factors are putting pressure on legal firm revenue and profits, leading them to turn to lower cost lawyers to stay competitive.
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