Should American companies run call centers outside the U.S.? During the past few years, an assumption has persisted among many Americans that only two types of choices exist. According to this assumption, if companies want to assure quality service, they locate call centers in the U.S. or in Canada. If they only want to save money, they locate call centers in India or in the Philippines.

In practice, businesses don't decide between quality and cost as if the two are polar opposites. Instead, they strive for a balance between quality and cost. To achieve this balance, businesses have to determine whether cultural and economic conditions in a region encourage workers to establish careers in customer service.

In low-wage countries like India and the Philippines, for example, there are plenty of jobs in call centers, but there is also anecdotal evidence of increasingly high turnover among agents. An explanation for this turnover is that India's and the Philippines' economies are experiencing rates of growth between 5% and 7% per year. Such rapidly-rising standards of living increase the tendency among call center agents in these countries to leave their jobs for different employers, or even different professions, where compensation is better.

In low-wage regions where annual economic growth is slower, say, between 2% and 4%, turnover among call center agents is less prevalent. An example of such a region is the Caribbean.

What's intriguing about call centers in the Caribbean is that agent turnover is staying low despite a rapid increase in the number of jobs. Philip Peters, CEO of Zagada, a Miami, FL-based consulting firm, and co-director of the firm's research arm, the Zagada Institute, points out that the number of call center agents in the Caribbean has grown from about 11,000 in 2002 to 33,000 in 2005. Yet average annual attrition among agents in the region still remains between 10% and 12%.

One reason for this phenomenon, Peters suggests, is that customer care, especially in the tourism and hospitality industries, drives the region's economy. As he puts it, "the Caribbean has a care dividend."

If we factor in education, literacy, attrition rates and orientation toward customer care, the labor force in the Caribbean has much to offer. A February 2006 report from the Zagada Institute estimates that by the end of this year, call centers in the Caribbean, plus those in Central America, will employ more than 75,000 agents. In this article, we focus on site selection trends in the Caribbean. We will look at trends in Central America in a future article.