Outsourcing: A Boon or Bane?
Summary
The increasing trend of outsourcing jobs from United States in recent years has created alarming unrest among American people. Politicians also believe that outsourcing has a negative impact on jobs, should this be allowed to continue, a prosperous future of all Americans is dim. These policy makers are exploiting this issue by introducing new protectionist policies. On the contrary, some economists have shrugged of the phenomenon as part of economic growth, as outsourcing benefitted U.S. economy by creating new jobs. In the article, the writer highlights the positive effects of outsourcing on the U.S. economy, as well as politicians’ ignorance on the long run benefits from it. Outsourcing is to move jobs that are currently being performed by people of country to another country with cheaper labor costs. There is no denying to fact some jobs are lost overseas when companies choose to outsource. It seems cruel that some people who are working in factories or in highly skilled Information Technology positions will be out of job. The fact is the outsourcing save number of state side jobs. Moving some of this labor overseas could mean the difference between company staying in business or going out of business. The option to lose some jobs lost in short run is better than losing all jobs due to company closure. Companies often take savings gained from outsourcing and reinvest these savings in order to expand and create better jobs in United States. Recent history
Consider total employment spanning 1988 through 2007 (the most recent year of data available from the U.S. Bureau of Economic Analysis). Over that time, employment in affiliates rose by 5.3 million—to 11.7 million from 6.4 million. Over that same period, employment in U.S. parent companies increased by nearly as much—4.3 million—to 22 million from 17.7 million. Indeed, research repeatedly shows that foreign-affiliate expansion tends to expand U.S. parent activity. For many global firms there is no
The increasing trend of outsourcing jobs from United States in recent years has created alarming unrest among American people. Politicians also believe that outsourcing has a negative impact on jobs, should this be allowed to continue, a prosperous future of all Americans is dim. These policy makers are exploiting this issue by introducing new protectionist policies. On the contrary, some economists have shrugged of the phenomenon as part of economic growth, as outsourcing benefitted U.S. economy by creating new jobs. In the article, the writer highlights the positive effects of outsourcing on the U.S. economy, as well as politicians’ ignorance on the long run benefits from it. Outsourcing is to move jobs that are currently being performed by people of country to another country with cheaper labor costs. There is no denying to fact some jobs are lost overseas when companies choose to outsource. It seems cruel that some people who are working in factories or in highly skilled Information Technology positions will be out of job. The fact is the outsourcing save number of state side jobs. Moving some of this labor overseas could mean the difference between company staying in business or going out of business. The option to lose some jobs lost in short run is better than losing all jobs due to company closure. Companies often take savings gained from outsourcing and reinvest these savings in order to expand and create better jobs in United States. Recent history
Consider total employment spanning 1988 through 2007 (the most recent year of data available from the U.S. Bureau of Economic Analysis). Over that time, employment in affiliates rose by 5.3 million—to 11.7 million from 6.4 million. Over that same period, employment in U.S. parent companies increased by nearly as much—4.3 million—to 22 million from 17.7 million. Indeed, research repeatedly shows that foreign-affiliate expansion tends to expand U.S. parent activity. For many global firms there is no