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BPO/SSC sector is the CEE region’s a dominant player in the demand for space in several of the 12 key cities

The BPO/SSC take-up totalled over 60 pct of all-sector office take-up in 4 key BPO cities (Wroclaw, Lodz, Krakow and Sofia) in H1 2017. Vacant stock is diminishing, due to this demand impulse and strong general economic conditions. Labour availability and employee tech knowhow uplift are significant factors which influence the demand for space. 

We argue also that other factors, aside from the cost of that labour are at play in the capacity for growth of BPO/SSC operators in the region. “Quality of life” in the cities where employees are located is becoming more important in this flexible, connected EU-free-labour-movement world.  The availability of labour and the acquisition of technical knowledge through education and training however looks critical to the continuation of the BPO/SSC racing in the CEE-6 countries. 

The costs of locating in the thoroughbred CEE-6 stable have definitely risen in recent years. There are certainly pockets of fast wage growth, with data from Randstad contained in the recent published ABSL Poland reports suggesting significant pay rises -  over 40 pct in banking in Warsaw and double-digit rises elsewhere. It should however be pointed out that the biggest rises were seen for specialist roles.

Graduates are more likely fertile recruiting ground for BPO/SSC players than the general jobless population. In cities such as Bucharest, Wroclaw (both 20 pct), Krakow (19 pct) and Sofia (17 pct), the ratio of implied BPO/SSC demand versus graduate supply looks most severe. The BPO/SSC industry can be treated as a significant recruiter where it is taking on more than 5 pct of the graduate population and that is the case in every city in the region we surveyed except for Budapest and Bratislava. The total number of employees engaged with BPO/SSC companies in Krakow, for example, is equivalent to 7.3 pct of the city’s entire population.

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