The Dangers Of Outsourcing

Supporters argue that outsourcing has a minimal effect on job losses, and has increased economic growth in some cases. In actuality, outsourcing has decreased the domestic economy by decimating job opportunities and lowering wages. Steven Pearlstein, economics columnist for the Washington post reaffirmed arguments that outsourcing has decreased employment availability and stability of the economy by saying “There are growing numbers of people who think that what started as a sensible, globalized extension of sending some work outside a firm to specialized companies may in fact be creating long-term structural unemployment in the United States, hollowing out entire industries”. (Pearlstein 3) The IT industry has been especially affected by outsourcing, with many jobs moving overseas to India and Bangladesh, leaving employees in the United States without a job, unable to compete with lower wage offerings. Supporters of outsourcing argue that this business strategy increases everyone’s productivity, raising everyone’s income, and boosting economic growth. Many such studies tend to focus on large multinational corporations, for which the data and anecdotes are more readily available. And indeed, during the 1990s, the data seemed to show that for every one job added abroad, companies added almost two new

Everybody has their own worries and opinions, so they choose to care about different things. Barbara Ehrenreich puts it this way, “The world may be flat, as New York Times columnist Thomas Friedman has written, but I always liked to think that I was standing on a bit of a hill” (608). The truth about outsourcing flies over the heads of many Americans, but hits Ehrenreich right in the face. She writes this article because it’s a journalist’s job is to take in new information that may be hard to understand or meant to be kept on the down low and convey it in a way that’s appealing to many. She implicitly blames CEOs and other high class positions for some of the more outrageous and negative outsourcing situations. Zakaria directly addresses this problem stating: “There is a growing gap between America’s worldly business elite and cosmopolitan class, on the other hand, and the majority of the American people, on the other” (622). America’s worldly business elite and cosmopolitan class are the ones that understand and control outsourcing, while the rest of Americans stay uninformed and are the real victims of outsourcing. Zakaria describes “the rise of the rest” as the third major tectonic power shift. His theory, which makes perfect sense, implies that these power shifts are a natural occurrence. According to Zakaria, the third shift shouldn’t hurt America and Americans shouldn’t feel threatened or worried by it. The thing that Americans should be worried about is the growing gap of power that exists between the elite business class and the rest of Americans. Because the higher class only looks out for themselves and only seeks profit for the firms that they control, many negative things are happening to the lower class, the biggest being the outsourcing of their jobs. This gap in power is what Zakaria thinks could hurt America and make it impossible to adapt to the more globalized world. Americans need

It is believed that offshoring will have minimal effects on the employment rate in America due to the theory that when jobs are moved to other countries, the workers who have become unemployed will find employment as new opportunities are created. In reality, the adjustment will be difficult as proven by data collected by the Bureau of Labor Statistics Displaced Workers Survey in the year 2004. A survey showed that workers who were laid off between the years 2001 and 2003 remained unemployed at the beginning of 2004. It was also recorded that 43 percent of those who managed to find work earned the same pay as they did prior to being laid off, but the remaining 22 percent did not. These facts rely on the rate at which

Many businesses in United States manufacture their product overseas. This involves manufacturing products outside United States where the labor cost is cheaper. Because of cheap labor, it is often more economical for a U.S. company to manufacture overseas and pay the shipping costs than to manufacture in the United States. For a company, the savings may be substantial. However, there are negative impacts on U.S. employment, as many jobs in the United States are being outsourced and replaced by overseas positions. The manufacturers outsource production projects to save time, money or resources. The manufacturing is outsourced so as to remain competitive and maintain a steady work flow. Without outsourcing, manufacturing costs could escalate to the point at which no product would sell and all employees would have no work. Outsourcing comes

Despite that an excessively excellent image of outsourcing was provided to individuals one or two of years back, the truth check they were confronted with shattered the dream badly. Recent statistics reveal that over four-hundredth corporations are concerned either in experimenting or are already engaged in shifting their services overseas in search of low-cost labor and services that are being provided by countries like China and Bharat. Such efforts have left native market labor at extreme disadvantage wherever they're finding it vastly tedious to create each ends meet, leave behind the back-breaking burden of taxes they're being obligatory to. With over four-hundredth major company executives registering their opinion by discouraging the method of outsourcing the controversy that was antecedently being won by the

It ends up putting our country farther into its trillions of dollars in debt. “Eight of the biggest U.S. technology companies added a combined $69 billion to their stockpiled offshore profits over the past year, even as some corporations in other industries felt pressure to bring cash back home (U.S)”. Eight of the top technology companies,including Microsoft, Apple and Google, now account for more than a fifth of the $2.10 trillion in profits that U.S. companies are holding overseas. “The amount of unrepatriated foreign profits reached $2.4 trillion, according to Citizens for Tax Justice, allowing companies to avoid up to $695 billion in taxes

Did you know that “the nation has lost more than 2.5 million manufacturing jobs and more than 850,000 professional service and information sector jobs, due to overseas shipping since 2001? (Aflcio)” It is clear to me that some big business companies don’t value the protection of employees very highly. By some big business, ill single one out and state that Goldman Sachs has shipped approximately 500,000 American jobs overseas in the past few years. That’s about half of the total net job loss during these past years (Aflcio). This shows that companies are reluctant to stay in American and scared of the current economic situation. It upsets me to see American jobs being shipped overseas at such a rough time

The phenomenon has created major suffering for many American and as this outsourcing continues to spread, Americans will demand action (R. Hira 2008, p-95). The book also adds that scholars Ralph Goory and William Baumol have shown that even when the basic model of the economics are used trade does not make both the trading partners better off. The trading in one country will have a negative impact while trading in other country will have a positive impact. The country with negative impact will definitely affect its economy. United States economy being the world’s largest economy; historically, it has maintained a stable GDP growth, a low unemployment rate, a high level of research and capital investment funded by both national, and because of increasing saving rates, increasingly by foreign investors. But offshore outsourcing has increased the unemployment rate dramatically in the decade. And so the economy worsened day by day.

In his campaign, Trump swayed voters by promising them that he will create jobs by sending illegal immigrants back to their country of origin and by forcing companies to manufacture in the United States again. In Obama’s lame duck days, then president-elect Trump was able to convince Carrier, a company that manufactures air conditioners, to not outsource 1,000 jobs to Mexico. However, Carrier only agreed to this deal because Mike Pence, former governor of Indiana, offered the corporation 7 million dollars in tax breaks. In addition, he also invested 16 million dollars into the Indianapolis plant. At the end of this deal, America is losing for the reason that this company does not have to contribute a portion of their earnings to American government worker salaries that are paid by taxes, such as police officers and firemen. If America under Trump goes down the route of isolation, we citizens will feel the effect at the cash register. Due to minimum wage laws in the United States, if companies begin to hire American workers, the sum of wages the corporation will have to pay its workers will be higher than compared to hiring a foreign worker. As a result, the consumer will have to pay for this increase because the cost of production ascended. As an example, it currently costs Apple $190 to fabricate a single iPhone overseas. If they shifted to

     The exporting of American jobs is an issue that is important and will become increasingly so as more and more white collar jobs are shipped overseas. American companies in the past few decades have been sending American jobs overseas paying residents of other countries pennies on the dollar what they had paid American workers to do. This saves the companies millions of dollars on labor costs but costs Americans precious jobs.

The loss of manufacturing jobs in the United States is extremely important. As this article states, when manufacturing jobs are lost so are service jobs. For every manufacturing job lost to things like outsourcing, 3 service jobs are lost. Not only are the people doing the manufacturing losing jobs, but

Michelle Malkin and John Miano as author reveal the worst perpetrators screwing Americas high skilled worker, how and why they are doing it and what we must do to stop them. In Sold Out, they will name names and expose the lies of those who pretend to champion the middle class, while aiding $ abetting massive lay-offs of highly skilled American workers in favor of cheap foreign labor.

As the graduating class of 2015 embarks on our way to college we have a difficult decision to make. Do I follow my dreams like I've always been told to do or do I go after a career that is “safe,” a career that cannot be sent overseas? I consider myself one of the lucky ones, I plan to pursue a career in Criminology, you cannot outsource police officers, no matter where you are there will always be criminals. Unfortunately for my parents this is not the case, their profession is currently being outsourced and 150 workers were laid off in their company. In Fareed Zakaria’s article, “The Rise of the Rest” he discusses the implications posed on the USA and other countries like China and India when companies export jobs. Implications that were

In “Will Your Job Be Exported?”, Alan S. Blinder argues the quality and security of jobs in the future, service sectors in America will be determined by how offshorable they are. Blinder starts out the story with a quote by Edmund Burke, “You can never plan the future by the past”. Although he stated we are doing exactly that when it comes to getting the American workforce ready for jobs of the future. Blinder states “demand for labor appears to have shifted toward the college-educated and away from high school graduates and dropouts” (p. 8). According to Lou Dobbs, “Well under one percent of US service jobs have been outsourced.” Eventually offshoring for service sectors will exceed offshoring for manufacturing-sectors for 3 reasons. First simply because there is a greater amount of service jobs than manufacturing jobs in the US and other countries that are well off. Second, service sector offshoring continues to accelerate due to technological advances thus increasing the range of services offshore. And lastly, (e.g. Chinese and Indian) workers with the capability to perform service jobs continue to increase rapidly.

To the opponents of outsourcing these statistics correctly state why outsourcing is a negative solution to cost cutting and affects the dignity of the people who used to work these jobs. To the people who have lost their jobs their dignity has been partially lost because they are now with out a job that they have worked for most of their lives and now they can’t provide for themselves and their dependents. Also for the companies that have outsourced these jobs they don’t provide adequate services for their employees who’s jobs are being outsourced. To the companies that outsource should help their former employees find other jobs. This would be beneficial to the worker and industry because the worker would loose a means of income and the industry would regain workers. On the other side the supporters of outsourcing say that it helps the dignity of workers who receive the jobs from the American corporations. An example of how outsourcing helps dignity is if you have an industry like web-design and you don’t get a job over a cheaper outsourced company you will have the extra motivation to improve your business or product (Business, ethics, morality).