One of the many debatable and controversial issues is outsourcing of jobs. Outsourcing jobs is when companies send some of their jobs overseas to different countries. Outsourcing is the procuring services or products, such as the parts used in manufacturing a motor vehicle, from an outside supplier or manufacturer to cut costs. Outsourcing has been gradually taking place “over the past four decades” (Stokes). Outsourcing jobs is a controversial topic for different reasons but the main reason is because it’s hurting America’s economy.
America’s economy is being hurt by the outsourcing of jobs. One of the biggest ways that America’s economy is suffering is because of the loss of jobs with each passing year. The jobs that Americans are losing are going overseas, because it’s cheaper. Outsourcing “allows a trained, cheap foreign labor force to provide American consumers with financial information, data processing and airline services at any hour of the day or night” (Stokes). Below is a chart from Sheree R. Curry and Jeremy Kahn’s article, Small Firms Find that Outsourcing Cuts Both Ways. The chart shows the different jobs that America has been losing to different countries since 2001. It shows a lot of variety of different jobs, for example accounting, telephone call centers, software publishers, etc.
Job Exodus
Percentage of jobs lost since 2001 in heavily outsourced sectors
-10.2% Software publishers (except Internet)
-10.3% Accounting, bookkeeping, and payroll
-10.6% Telephone call centers
-14% Computer systems design
-24% Computer and electronic products
SOURCE: U.S. Bureau of Labor Statistics
If outsourcing keeps going the way it’s going then Americans are going to keep losing their jobs, “The most frequently estimate, by Forrester Research, a leading business consulting firm, forecasts that 3.3 million U.S. jobs will be shipped overseas by 2015” (Stokes). The people who lose their jobs and are lucky enough to find new ones still may not be able to have the same benefits and money they were use to having because “they may have to settle for less pay” (Evans). The reason “they may have to settle for less pay” is because they have had the same job for most of their lives (Evans). Which means that they have most likely gotten raises and been promoted. Therefore, if they get new jobs they have to start over on the bottom. Those people who have lost their jobs and have found new ones for less pay aren’t that well off either, because they will have to cut back on things they were use to and/or things that they need.
Some people say that outsourcing is good for America’s economy. The reason some say that sending jobs overseas is a good thing is because they think that it saves he economy money, “But the savings come at a price: the loss of white-collar jobs that were supposed to provide future employment for the sons and daughters of Americans who lost their jobs in the shrinking manufacturing sector” (Strokes, 35). This means that America has been counting on the jobs that we are losing to employ the daughters and sons of the American workers who work there now. How is it really helping America save money if we are losing more and more jobs with each passing year? To help the economy grow you have to spend money. Which if you want to spend money you are going to have to have money to spend. So therefore, to have money, people need to be working and getting paid. Yet, if you lose your job then you aren’t working so therefore you aren’t getting paid so you can’t spend money to help the economy grow. So if the economy isn’t growing then it’s either standing still or it’s declining (declining is more likely).
Most of the people who are losing their jobs are older people, middle-aged and up, and have had their jobs for most of their lives. They don’t have time or money to go back to school and learn a new career or trade. They not only have to provide for themselves, but most have to provide for their families. Yet, how are they going to provide for their families without a job? They can’t provide for their families without a job unless they go on welfare, and most people don’t want to go on welfare. Welfare also cost money and the government gets that money from tax payers. Yet, since people are losing their jobs they don’t have money to pay tax. Is welfare going to be an option for much longer? So, what should the older people do? Nothing? What if it was your dad, your brother, your uncle, your mom, your grandfather, your husband, your wife, or maybe even you that lost their job? What would you do? Would expect the government to step in if those people or you lost you job to outsourcing? The government should help out more then it is doing. A lot of the people who are for outsourcing jobs would change their minds if they lost their job or somebody close to them lost their job because of outsourcing.
It seems like the companies who are sending some of their jobs overseas are just doing it, not because it helps or hurts the economy, but because they are greedy and want to save their money. Companies started sending manufacturing jobs overseas but over the years they have started sending different and higher paid jobs overseas. Computer programmers and other “white-collar job service workers are the new victims of globalization and deserve help” (Stokes). Bruce Strokes quoted a managing director of Petkevish & Partners, a San Francisco-based investment and financial advisory firm, Michael Borrus, “Foreign outsourcing ‘has permitted American companies to specialize in what they do well, take advantage of work done offshore, and integrate everything back to the company’s advantage'” (Stokes). This means that the companies who outsource jobs just care about themselves and their company.
They don’t care about America, its economy, or what happens to the people who are losing their jobs because the companies are the winners, “‘American companies are doing better than America,’ analyst Donald Straszheim observed” (Allen). So if the different companies are the winners then there has to be losers and according to Jodie Allen the “Losers are the middle and working classes in now rich countries” (Allen). The middle and working class makes up most of America. Below is a chart from Bruce Strokes’ article Outsourcing jobs: U.S. dilemma that takes a look at the different salaries in different countries for computer programmers. The chart shows why American companies send their jobs like computer programming to different countries. Jobs are being taken away from America and are being sent overseas, because it’s cheaper for the company.
Pay Disparity
A comparison of average salaries for computer programmers for selected nations.
Country Salary Range
Poland and Hungary $4,800-$8,000
Russian Federation $5,000-$7,500
India $5,880-$11,000
Philippines $6,564
Malaysia $7,200
China $8,952
Israel $15,000-$34,000
Ireland $23,000-$34,000
Canada $28,174
U.S. $60,000-$80,000
Source: The New Wave of Outsourcing, Ashok Deo Bardhan and Cynthia A. Kroll
However, even though it costs less for the companies to send jobs overseas, some of those jobs may be more complicated and harder to handle so far away. In the article, The Next Frontier: Outsourcing the editor interviewed the chief economist of Global Insight, “According to Nariman Behravesh, chief economist of Global Insight, a forecasting and consulting firm based in Waltham, MA, computer software programming requires more creativity and is apparently more difficult to manage at a distance” (Editor). Which most companies haven’t thought about. Hopefully it will hit them and they will bring the jobs back to America, it’s unlikely but all we have now is hope that sending jobs overseas will fail and the companies will move them back to America.
Outsourcing is hurting America where it counts the most, in its economy. Yet, nothing is being done about it. A lot of people are losing their jobs because it’s cheaper for the company to pay others in different countries to do the jobs. Shouldn’t America be concerned about its own economy? Companies are finding more jobs to take away and send overseas. What is keeping them from coming after your job? Nothing. If they think they can pay somebody less money for the same amount of work that you do somewhere overseas then your job could and most likely will be next. No jobs are really safe when it comes to outsourcing. Outsourcing jobs is a very controversial issue for many different reasons, but the main reason is because it’s hurting America’s economy. Hurting America’s economy leads to other issues “about jobs and livelihoods, feeding our families and ensuring their safety and well-being in a world that presents threats” (Challenger). If the economy is hurting then it’s because it’s losing money. If the economy is losing money that means that the people in the economy are going to lose money (for example, you). Without money people can’t survive because money allows us to buy the things we need. Outsourcing jobs not only affects the people who are losing their jobs but the whole economy, and yet, nothing is being done about it.
