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Out Sourcing Essay

860 words - 4 pages

The Long Term Effects of Outsourcing on the US Economy
The impact of outsourcing in the US economy has evoked extensive emotions to many, especially from presidential candidates and labor groups who criticized its practice. But economists and chief executives defend it as a natural succession of the economy.
In today’s fast paced economy, it’s not new that outsourcing chased cheap labor costs around the globe for decade. But in recent years, the effort has move stealthily into higher mechanism and income brackets, and it shows no signs of slowing down.
As a concept it is not new. Companies have chased cheap labor around the globe for decades, making cars in Mexico, plastic toys in Taiwan ...view middle of the document...

Going from $9.00 an hour for tech workers to 27 cents an hour for labor, has provoked corporations to overlook other costs associated with outsourcing. Bonuses are defined at the year’s end and that is long term enough for these corporations. U.S. investors, shareholders and American consumers derive the benefits of outsourcing, although sometimes at the expense of American wage earners.
Another reason why outsourcing still evolves is that more and more companies are viewing the world as a global marketplace, and sometimes requires building factories within outsourced countries in order to sell products, wherein manufacturing companies also don’t want to be left behind. Almost everything in this world is moving to outsource.
Another supportive argument is that outsourcing jobs to other less developed countries helps those countries economically and helps increase trade for US products. It also gives those countries the ability to pay back their debts to the U.S.
Experts believe that the greatest saving potential comes from outsourcing simple assembly work or services. Since there is not much capital involved, except for training people in other countries and payments for displaced U.S. workers, there is no other major investment. It is no secret that American technology companies in recent years have benefited from sending work to lower-cost operations overseas. From printer assembly in Taiwan to microprocessor manufacturing in Malaysia, the cost advantages of outsourcing have been on the top of the list for many corporate executives. About 30 percent of Intel's microprocessors are now built overseas, primarily in Ireland and Israel. Four of the six manufacturing...

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