Hewlett-Packard Expands; Now One of Country’s Biggest Employers
One leg slung over the other, Jaime Aguilar sits comfortably on the slick sofa chair in Hewlett-Packard’s lobby, carrying on.
He spangles his speech with the occasional tech word or phrase in English. He was inspired to learn English as a kid, when relatives in the United States sent him gifts.
“They sent me the Batman and Superman movies. I wanted to see them, so I had to learn,” says the 23-year-old HP team manager.
Before him, water trickles down a three-story glass fountain in the center of Hewlett-Packard’s expansive new office center in the Ultrapark tax-free zone in Heredia, northwest of San José, where the bulk of HP employees in Costa Rica work.
“The environment hire is identifiable,” he says.
It’s one of a handful of dazzling office buildings in Ultrapark with glistening glass facades that reach into the sky – monuments to globalization.
Outside, tropical sun beats down on crowds of bustling twenty-something professionals wearing designer clothes, trendy sunglasses, Nike and Puma shoes. Passing groups mingle in English and Spanish, the two languages mixing into a sort of Tico Spanglish.
In Costa Rica – which was recently dubbed the second most “globalized” Latin American country after Panama (TT, Dec. 1) – thousands of residents work in the booming services industry, where jobs in telemarketing, online gambling, and tech support are being outsourced from countries like the United States to hundreds of call centers operating throughout the Central Valley.
Hired for their ability to speak English or other languages and in HP’s case their technical know-how, their job is to provide customer service via telephone to customers in the United States, Canada and other countries, including many who are unaware that their demand for services are employing thousands of Ticos.
HP is Costa Rica’s biggest employer in the services sector with nearly 4,000 workers, and the company expects to hire another 1,000 by 2008.
Walking into the expansive office space here on the building’s second floor is like plunging into a sprawling, chest-high sea of cubicles. Hundreds of employees are submerged below cubicle-level at computers, focused intently upon helping the customer they’re attending through their snug-fitting headpieces.
The Arias administration has applauded the arrival of more and more high-tech companies like HP and Intel, massive employers whose offices can be found in the country’s tax-free zones. They provide Ticos with competitive salaries, good benefits and a slew of training opportunities such as language classes.
“I have a lot of clients who speak (French), so I would love to speak a little bit of French to have a deeper conversation with them,” Aguilar said.
Most of the company’s employees are between 25-30 years old, and 95% of them speak English, according to Aguilar. The company has developed a reputation for treating employees like family.
“You have all the resources here to construct a career,” said Aguilar, who studied engineering systems in El Salvador and at the Universidad Latina in San Pedro.
In Costa Rica, HP touts the slogan “we have more than 3,000 reasons to be in Costa Rica.” Martin Castillo, HP’s General Manager for Central America, Puerto Rico and the Caribbean, said the company strives to maintain and train employees.
“We want our employees to stay with us a long time,” he said.
But HP’s employee-centric image took a hit soon after Mark Hurd took over as chief executive of the U.S.-based computer and printer manufacturer last year. Hurd announced last July that HP would cut 14,500 jobs and overhaul its retirement plan to save $1.9 billion a year. In trimming the company’s global workforce of 151,000 by 10%, support jobs were most affected – in information technology and human resources, the BBC reported.
Since the job cuts were announced in the United States, the company has added hundreds of employees in Costa Rica, and announced plans to add more than a thousand jobs here.
Though Costa Rica is one of HP’s biggest operations, it pales in comparison to China and India, where the company has a combined 16,000 employees.
The global business operates in 32 countries, and has been sending its labor offshore for years.
The company came to Costa Rica in 2003 with just 400 employees to provide tech support for Proctor and Gamble. In just three years, as the company has laid off thousands of workers in the United States and elsewhere, it has expanded its workforce here nearly tenfold.
“We’re reducing costs … we’re outsourcing everything that’s behind the walls,” Castillo said.
He said the company has kept its research labs and sales and marketing departments in the United States. It’s the tech support that has been outsourced to reduce costs.
“Did you read ‘The World is Flat’?” he asked, referring to New York Times journalist Tom Friedman’s book on how globalization has meant massive outsourcing of labor.
“That’s what we do here,” he said, sitting in HP’s Forum office in Santa Ana, west of San José.
“We don’t see outsourcing from a negative point of view. Americans understand it’s an offshore operation. In the end, we’re more competitive… We want to grow faster than our competitors,” he said.
HP in Costa Rica has been holding job fairs in San José practically every weekend, Aguilar said.
The company chose Costa Rica for its strategic geographic position – halfway between the United States and South America – its large supply of English-speakers, and its relative political stability in the region. Costa Rica also touts high technology penetration rates, Castillo said.
While Intel was receiving the highly public pat on the back from the Arias administration as it planned to celebrate its 10th year here (TT, Oct. 13), HP was quietly becoming Costa Rica’s largest high-tech employer.
“HP isn’t a flashy enterprise,” Castillo said. “We’re low key.”
Costa Rica is a “showroom” for HP operations in Latin America, he said. Not only is the company expanding here, it has implemented several programs that reflect the company’s social responsibility. Among them are distance-education programs, internships for local students, and a program that equips a bus with Internet access and drives around low-access communities to expose kids to the technology.
Castillo said he hopes the Central American Free-Trade Agreement with the United States (CAFTA) is passed because it will guarantee economies of scale, standardize the nation’s infrastructure, Customs laws, and will mean more knowledge exchange within the region.
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