Phil Taller: Strong Wage Growth Signals Opportunity in Business Process Outsourcing
Phil Taller, Senior Vice President, Portfolio Manager and Head of the Mackenzie Growth Team, discusses increased wage growth in the U.S. and the search for productivity.
Notes:
- After 6 years of anemic wage growth, wages have started ticking up over the last 6 months, to a level where they are growing a fair bit faster than inflation.
- If companies do nothing, then their profit margins will start dropping, so we think there is an increased tailwind for companies to go and find ways to make their people and their assets more productive,
- We’re deep into quarterly earnings season here and one thing we are seeing and hoping to see more of is many of those companies in the technology realm, especially who we think can help with corporate productivity, demonstrating the kind of growth we expect.
- So far its been pretty good.
- In U.S. Mid-Cap Growth, which is our key mandate, we do have a fairly big exposure to technology, and in particular, on this search for productivity theme, we own a number of business process outsourcing companies that we’ve added in the last year or so.
- These are companies that will take a business process of their client’s plate, and do it better, faster, cheaper, which is a key thing we look for in all our companies.
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