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Digital Futures 
The Chancellor’s recent announcement of a £25 billion hike in Employers’ National Insurance has heightened concerns over the high cost of the UK labour market. Businesses and
investors now face an even tougher economic landscape, with the UK seen as increasingly expensive for employment compared to other locations. However, while these cost pressures are real, companies must resist an impulsive reaction to resort to offshoring. Instead, businesses should double down on their commitment to creating jobs within the UK, recognising that investing in local talent is a sustainable pathway to economic strength
and competitive advantage.
With rising operational pressures, UK companies have increasingly turned to offshoring, particularly in technology roles, moving jobs to lower-cost regions such as India, Eastern Europe, and Southeast Asia. Although offshoring may seem financially attractive in the short term, this strategy has a steep, often overlooked cost. Shifting jobs overseas drains talent from the UK’s tech sector, reduces opportunities for skill development, and weakens the country’s position in the global technology landscape. The narrative of a “skills shortage” in the UK too often serves as a justification, masking an unwillingness to invest in nurturing local talent.
This article explores the real impact of offshoring on the UK economy and society, calling for companies to take greater responsibility for job creation and local talent development. It provides actionable steps to help businesses maintain an onshore presence, empowering the UK workforce and enhancing the nation’s technological leadership.
Companies frequently cite a “skill shortage” to defend offshoring, but this rationale doesn’t fully hold up. The UK has a robust tech education system, producing skilled graduates in fields like data analytics, computer science, and artificial intelligence. Many professionals in the workforce also possess the foundational skills to transition into tech roles with the right training. The actual challenge lies not in a lack of skills but in the reluctance of companies to invest in local talent development.
While offshoring may reduce immediate costs, it deprives UK workers of opportunities to build advanced skills, eroding the nation’s long-term competitiveness in technology. By committing to local talent investment, companies can better address their own operational needs while strengthening the UK’s position as a global tech leader. A locally rooted workforce brings advantages beyond financial metrics, driving higher employment rates and boosting skills essential to a sustainable economy.
Youth unemployment in the UK is climbing, with the Office for National Statistics reporting an increase from 10.5% in 2023 to 11.6% in 2024. These figures underscore the growing challenges young people face in securing quality jobs, especially in tech, a sector rich in career opportunities. Offshoring tech roles directly undercuts this potential, exporting jobs that could provide young people with critical work experience and entry points into high-growth careers.
Without access to these early career opportunities, young professionals struggle to establish themselves in tech. Those who manage to find work may have to settle for lower-paying roles with limited advancement prospects. By prioritising local hiring, companies can offer young people meaningful career pathways, strengthening the UK’s competitive edge and ensuring a more resilient workforce for the future.
“Youth unemployment in the UK is climbing, with the Office for National Statistics reporting an increase from 10.5% in 2023 to 11.6% in 2024.”
Offshoring tech roles doesn’t just affect job seekers; it also impacts the UK economy. When jobs are moved abroad, the UK misses out on income tax, National Insurance, and corporate taxes that would otherwise support public services. The reduction in tax revenue limits government resources for crucial infrastructure, healthcare, education, and other essential services.
Each tech job created locally contributes significantly to public funds, supporting investments in transportation, housing, and renewable energy. Furthermore, high youth unemployment increases reliance on social services, further straining government resources. By supporting onshore job creation, companies help ensure a stable tax base that strengthens public infrastructure and enhances the overall quality of life in the UK.
Offshoring once promised substantial cost savings, but this advantage is rapidly eroding. Salaries in offshoring hubs like India and Poland are on the rise, with tech salaries in India climbing by 8-10% annually. In high-demand fields such as AI and data science, wages are approaching UK levels. The financial benefit of offshoring diminishes further when factoring in the logistical challenges, time zone differences, and potential quality issues of managing remote teams.
Given these evolving dynamics, companies must reconsider whether the diminishing financial gains from offshoring justify the loss of control and flexibility that onshore teams provide. Onshore teams can respond to changes with agility, ensuring high standards in a way that offshored operations often struggle to match.
In the AI-driven economy, the value of local talent is clearer than ever. Building AI solutions demands specialised skills, close collaboration, and adaptability—all of which are optimised by onshore teams attuned to local market needs. Onshore teams provide companies with a deeper understanding of regional dynamics, enabling them to deliver tailored solutions that meet business and regulatory demands.
Investing in local talent also safeguards intellectual property, preserves institutional knowledge, and strengthens a culture of innovation. A committed, skilled UK workforce can drive AI initiatives with greater agility and collaboration, delivering tangible business value while maintaining a competitive edge in a dynamic industry.
"Building AI solutions demands specialised skills, close collaboration, and adaptability—all of which are optimised by onshore teams attuned to local market needs."
In today’s global business landscape, UK company boards face a complex balancing act. While meeting shareholder expectations for returns, they must also consider the responsibility of creating and sustaining jobs within the UK. For many companies, offshore centres are essential to maintaining round-the-clock operations, supporting international customers, and ensuring continuous service delivery. Offshoring has become integral to global competitiveness, allowing businesses to operate seamlessly across time zones and offer swift, responsive support to customers worldwide.
However, the reliance on offshore centres to drive operational efficiencies should not overshadow the importance of nurturing talent at home. UK boards must strategically integrate offshore capabilities with a strong commitment to UK job creation, recognizing that investing in local talent is not only an ethical priority but a sustainable business advantage. This balancing act requires a shift in boardroom priorities and a reconsideration of how executive compensation is structured to reward both financial performance and social responsibility, particularly in alignment with environmental, social, and governance (ESG) goals.
Currently, executive compensation structures tend to prioritise short-term financial metrics like profitability and share price. However, to encourage responsible business practices, compensation metrics should be expanded to include local employment, talent development, and community investment targets. This reweighted approach would reinforce ESG principles at the heart of business strategies, ensuring that UK job creation becomes a key performance metric for company leaders. By recognising the strategic value of both onshore and offshore capabilities, boards can better manage shareholder expectations while fulfilling their responsibility to UK society.
In addition to shifts within the corporate sector, there is a larger role for the UK government in ensuring that businesses actively contribute to domestic employment. Government-backed accountability measures, such as mandated job creation disclosures, would enhance transparency, allowing shareholders and the public to see the true impact of a company’s employment practices. Additionally, tax breaks and financial incentives could be offered to companies that meet specific UK employment targets, encouraging more firms to invest in local talent. Regulatory frameworks could also establish ESG compliance benchmarks that explicitly include UK job creation criteria, signalling to investors and boards alike that maintaining a local workforce is not just a corporate social responsibility but a core accountability measure.
To support these goals, companies and policymakers should adopt strategies that promote a sustainable balance between offshore capabilities and local job creation. Transparent reporting on UK-based job creation, establishing balanced onshore-offshore role ratios, and implementing government-backed incentives are practical steps for aligning business actions with both shareholder expectations and national economic needs. By taking these steps, UK businesses can operate effectively on a global scale while supporting domestic employment, ultimately ensuring a future where shareholder returns, global service needs, and local job creation go hand in hand.
"For organisations, Digital Futures provides a cost-effective model for accessing skilled engineers, with tailored programmes to support onshore capability building."
Digital Futures exemplifies this commitment to local talent development. For individuals—especially young professionals or those seeking reskilling opportunities—Digital Futures offers a comprehensive Academy Programme in data, AI, and technology. Through partnerships with tech giants like Google, it equips individuals with the skills needed to succeed in the UK tech sector.
For organisations, Digital Futures provides a cost-effective model for accessing skilled engineers, with tailored programmes to support onshore capability building. By helping companies establish regional tech centres, Digital Futures fosters economic growth in underserved areas, enabling businesses to tap into local expertise and contribute to regional resilience.
Despite the recently announced increase in employers National Insurance, UK Companies need to remain committed to UK job creation, believe in the talent that exists in the country and take a long-term view to investment to ensure the UK remains at the forefront of innovation.
While offshoring may offer short-term savings, the shrinking cost benefits, rising youth unemployment, and increasing demand for advanced skills make it a less viable long-term strategy. A strong commitment to onshore job creation not only bolsters economic stability but also builds a talent pool capable of navigating the challenges of a rapidly evolving tech landscape.
Through transparent reporting, employment caps, and government incentives, UK companies can foster a thriving domestic tech sector that attracts investment, drives innovation, and ensures sustainable growth. In collaboration with partners like Digital Futures, businesses have the opportunity to redefine success—placing the development of UK talent at the heart of their strategy, ensuring that the UK remains a global leader in technology and innovation.
Digital Futures 
Digital Futures 
Scott Vincent 
Digital Futures 
Digital Futures 
Digital Futures