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Outsourcing -- two sides of the coin |
Is Outsourcing Good? Is Outsourcing Bad? What are the advantages and disadvantages of Outsourcing? Who benefits from Outsourcing? Why is there so much controversy produced by Outsourcing?
Some love Outsourcing. Some hate Outsourcing. Emotions collide. Barriers brake. People are at it. But, where did the Outsourcing dilemma start?
Some time ago, blue collar jobs were outsourced to economically weaker countries such as China, Mexico, and the rest. American blue-collar workers lost jobs and have had hard times getting new ones. If, some time ago, it was easy to survive in America with just a High School diploma, nowadays, you have to have at least a Bachelors degree for a financially rewarding career.
There were some “positives” to the outsourced blue collar jobs. Since a cheaper labor was used, American people got to buy several products at cheaper prices. I remember VCR’s costing about $200-300 just 10 years ago. Nowadays, you can buy a DVD at around $100. Supposedly the products we get are of superior quality too. However, I’m not sure about that one! It seems to me that clothing and shoes with tags “made in China” survive only about a season or two. Sometimes, clothing shrinks after the first wash. Sometimes, it clothing get ripped easily. The shoes are not better. Americans are so accustomed to short survival of clothing that they don’t even notice the poor quality that is not even compatible to European made products. Unfortunately, I can’t make comparisons to American products; there are not too many. Maybe the reason Americans are into shopping that much and get into financial difficulties so often because of how much money they have to constantly spend on products that don’t survive long?
Nowadays, no one will argue that we are outsourcing “good” jobs. Many white collar jobs are being outsourced to countries such as China, India, Russia, etc. Outsourcing affects such parts of the business as design, software development, financial control, logistics management, customer support, and sales.
As the “positives”, outsourcing has been praised to be cost-effective, efficient, productive, and strategic.
Because of Outsourcing, we get lower prices on the products we purchase. Outsourcing raises the country’s standard of living, and benefits low income people and seniors living on fixed income. Also, some predict, as the population ages (Baby Boomers), there will be fewer workers to fill the jobs, so we’ll need to outsource even more to stay well as a country.
Since there are skilled people in the poor nations, and their daily costs are much lower than ours, we can pay them enough and still economize. Since we are creating jobs in those countries, they can generate work for many more as the money flows into the national economy and will return dividends through Globalization.
Through creating jobs in other countries, we are helping to close the gap between the poorest and the richest countries, and bringing security to the world.
Due to outsourcing, shareholders get higher profits, and, in turn, spend it within United States, effecting American economy.
If there are so many positives to Outsourcing, what is all the fuss about? Why are so many against the concept of Outsourcing? Why so many condemn Outsourcing as evil and destructive? Where are the “negatives” of Outsourcing?
The biggest negative of Outsourcing is, once again, American jobs. United States loses about 230,000 jobs a year due to outsourcing. Some argue that new jobs are not being created that rapidly.
It’s unpatriotic and even sad to be playing Mother Theresa by taking away jobs from Americans and giving them to the “less fortunate”, and contributing to other countries’ economies while taking away from our country.
It’s been an opinion that by outsourcing jobs, we are not really creating markets for our goods. After all, United States has a trade deficit with almost every country it trades with.
We are loosing skills due to Outsourcing. We have lost such industries as consumer electronics, small appliances, toys, and others. In fact, China and India graduate ten times more engineers than the United States. And, most US engineering school graduates are foreigners who don’t stay here.
So, what are we doing? Are we digging a hole and burying ourselves in the long-run? It looks like we are! If we continue with the Free Trade, there will be a continuation of downsizing and reducing our jobs. After all, we, having mortgages, credit cards, loans, and taxes, cannot compete with the salaries of people with a lower cost of living. And, by loosing the knowledge and ability to make things, we won’t be able to recover economically.
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