U.S. Prisons Little-Known Supplier of Outsourcing Labor

Ann All

Sheesh, when I'm wrong, I'm wrong. In a post from earlier this month about a project in India to establish a BPO center in one of the country's prisons, I called it a progressive idea to give inmates an opportunity to learn skills for which plenty of jobs are available. I also wrote: "This is largely lacking in U.S.. prisons, which rarely offer more than bare-bones general education courses taught by volunteers." I admit I didn't fact-check this. And boy, does it show.


It turns out that U.S. prisoners have provided a variety of business services for private companies for more than a decade. Among those services is call center work, with more than 1,000 inmates in eight federal prisons handling tier-one support and other services for a handful of corporate clients, most of them SMBs, reports CIO.com. The inmates work for Federal Prison Industries (operating under the trade name UNICOR), established by the Franklin D. Roosevelt administration in 1934 to manufacture goods for the government. FPI began selling services to private corporations in 1999.


FPI employees earn an average of 92 cents an hour for call center work. They do not handle any personal identifying information or classified data in the course of their duties.


Interestingly, groups as diverse as the U.S. Chamber of Commerce and the AFL-CIO have opposed FPI, saying it takes jobs away from folks outside of prison walls by offering services at prices far below market rates. (Sound familiar?) However, FPI supporters say few jobs are affected since FPI employs only 17,000 prisoners.


The article quotes Phil Fersht, founder of outsourcing analyst company Horses for Sources, who says the relatively small number of workers creates an inability to scale, which means FPI wouldn't stack up well against other outsourcing providers. He mentions other issues, including the difficulty of finding managers who would want to work in prisons and possible issues in using call center software and monitoring gear.

Add Comment      Leave a comment on this blog post
May 27, 2010 1:54 AM Cassidy Moss Cassidy Moss  says:

They stamp license plates right?If they are making $.92/hr, is there a study that shows where that money goes?




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