GE, IBM Shifts Focus from India to Hungary

Filed in archive Outsourcing News on March 6, 2005

Hungary is attracting major outsourcing players as IBM and GE turns to the Eastern European country for their outsourcing needs. IBM will create 700 service outsourcing jobs in Hungary, while GE favored its Hungarian unit as it shut down Indian operations. German-based software firm SAP will also operate a service center in the country.

According to Hungary's Ministry of Economic Affairs, IBM will invest $35.54 million to create 700 service center jobs in the country. These jobs would be in financial services, human resources, procurement, and call center operations.

Hungary has been working to attract high skill jobs to the country as it loses manufacturing jobs to other countries. Manufacturing jobs have left the country because of high wages and a strong Hungarian currency. IBM was one of the big manufacturers that closed manufacturing operations in the country. IBM's new outsourcing unit is a victory for Hungary.

The country's outsourcing growth is not causing any backlash from the U.S. The lack of an outsourcing industry association in Hungary may be the reason for this. Without an association like India's Nasscom, there are no perceptions of job stealing from Americans.