It is no secret that political and technological developments have a profound impact on the language industry. Particularly, language service providers (LSPs) are finding themselves having to constantly react and adapt to disrupting political and technological changes. It is key to proactively change the way your business operates in order to stay ahead of the curve.
Changing Political Landscape
We recently saw AB5 being passed in California, which will reclassify all interpreters as employees and no longer as independent contractors, starting January 1st 2020. This means LSPs would have to put their interpreters on the company payroll and offer them work benefits, rather than hiring them as independent contractors. This is obviously a major game changer for LSPs in California. Since they can’t put every interpreter on their payroll, they will have to make some tough decisions concerning the range of language services they will be able to offer. Perhaps the solution would be to focus only on a few niche services? In any event, if interpreters are not exempt from the bill, LSPs (and interpreters) in California have some tough times ahead of them.
In the state of Washington, there’s another political development potentially threatening the future of LSPs. The Department of Enterprise and Labor & Industries are looking to eliminate the role of LSPs altogether, by inviting independent scheduling organizations to replace the role of the language service provider. This initiative is being driven by the desire to increase the rates paid directly to interpreters, and to reduce the profits of LSPs. On the one hand, institutionalizing interpreting services could bode well for interpreters. Their rates might actually increase, and if Washington decides to follow California’s lead by reclassifying interpreters as employees, then interpreters would not be as affected since they would essentially be government employees.
However, institutionalizing interpreting services could also be dangerous. If Washington decides to move away from a free market system by getting rid of LSPs, then the quality of interpreting services could suffer. LSPs may chip away at interpreter rates, but they are experienced with interpreter management and quality assurance. Would the Department of Enterprise and Labor & Industries be equipped to manage that many interpreters? It seems doubtful. Whatever happens, LSPs should prepare themselves should the state of Washington actually decide to move forward with the institutionalization of interpreting services.
Simultaneously, technological advancements are making their mark on the language industry as well. Specifically, remote interpreting solutions are changing the way LSPs offer their interpreting services. Remote interpreting is effectively decreasing the need for face-to-face interpreting. More and more often, interpreters offer their services over the phone or over video. It saves them time, energy, and money. Through remote interpreting, LSPs can handle a larger volume of assignments, and they can offer a larger variety of services by contracting niche interpreters from all over the world. In order to accommodate this evolution, LSPs often resort to interpreter platforms like Interpreter Intelligence in order to fill this technological gap.
Remote interpreting solutions have also removed barriers for (smaller) organizations to offer their services all over the globe, because they are no longer restricted to their local markets. This increasing global access to interpreters is good since organizations and governments can now boast a more inclusive language policy. However, the rise in remote interpreting can also be a problem to individual LSPs. With increased access comes increased competition, and with increased competition often comes decreased profits. For some LSPs, it is becoming a real challenge to compete with LSPs from low-wage countries. As the supply of language services becomes increasingly saturated, LSPs will have to find new ways to remain profitable. Again, focusing on niche services could be the answer, but niche industries have limited growth opportunity.
To sum up, the language industry is on the brink of a major revolution, so it might be time for your business to do some scenario planning. It is time to assess to what extent the developments above would affect your business, to ask yourself what you can do now to stay ahead of the curve, and to think about how you can retool your business to remain competitive. What do you think will impact the language industry most in the coming years? Let us know!