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Kansas Call Center to Receive More Work after Starwood Hotels Shuts Down California Facility

Starwood Hotels has announced that it will close its call center in Lancaster, Calif. and transfer that facility’s duties to the company’s other call centers. One location in particular, based in Wichita, Kan., is expected to expand to hire more employees and become Starwood’s largest call center.

Stamford, Conn.-based Starwood Hotels and Resorts Worldwide, Inc. owns several well-known hotel brands like Westin, Sheraton, Four Points, St. Regis and W Hotels. Their call center in Wichita opened last summer and employs about 300 people. That number is expected to grow to about 900 over the next five years, thanks to incentives from local governments.

Starwood’s call center is not the first major center in the area. Royal Caribbean has a call center that employs over 300 people in the southern part of the city, taking calls for the company’s Celebrity Cruise brand.

The largest private sector employers in the area are in the aircraft industry. Cessna, Beechcraft and Bombardier-owned Learjet are either based or have large plants in Wichita. Spirit AeroSystems, which formed when Boeing (News - Alert) sold off its Wichita operations, builds major portions of Boeing airliners and employs nearly 11,000 people. Airbus has offices in the area and numerous small plants manufacture components for the larger aircraft companies. 

No specifics were given on the reasons for Starwood closing the Lancaster facility. Two likely reasons are the lower costs of doing business in Kansas and the incentives that local governments offered.

In 2012, Comcast (News - Alert) relocated 1,000 call center jobs out of northern California to Washington State, Colorado and Oregon. At that time, Comcast spokesman Bryan Byrd stated in an interview with KXTV that, "The high cost of doing business in California makes it difficult for us to run cost-effective call centers here." Comcast later sent out a revised press release that backed away from criticism of California’s economics, but the company’s original statement is more believable. Other business spokespeople in the interview cited economic burdens like high workman’s comp as the basis for relocation.

Starwood’s exit out of California seems to be part of a disturbing trend. In 2011, an average of over five companies a week left the Golden State. Even Silicon Valley success story Apple (News - Alert) decided to create 3,600 new jobs in Austin, Tex. in 2012.

It’s unfortunate, but it’s also reality: if labor costs become too expensive for a company, those jobs will be relocated overseas to places like India or domestically to other states like Kansas and Texas, where it’s more affordable to do business and where governments are rolling out the red carpet to get more companies to relocate to their region.