Outsourcing Outsourcing has been a consistent problem in the United States for years now. It has always sparked a flare of controversy when Americans now there is a job shipped overseas for cheaper labor. People bash on outsourcing saying that it is bad for or economy, however, businesses love outsourcing. The main reason why it is good for businesses is because it reduces the cost for labor. Businesses are willing to give someone a job overseas because it doesn’t cost the company as much money rather than giving a job in America. Since America has minimum wage and other countries don’t, corporations are willing to ship jobs overseas to save money.
Outsourcing is also has disadvantages as well. For businesses, the quality of a product from the result of outsourcing kind of takes a nosedive. Since many firms that provide outsourcing quickly cut the quality of component parts in order to increase their margins. Eventually customers who are accustomed to believing your brand promise begin to notice that your once-great products are suddenly cheap. Also since most of the third party service providers excel at the services they provide, businesses are guaranteed of better quality than an in-house employee would give. Additionally, any service provider will always look to give the best of services since their reputation is at stake.
Also another reason why outsourcing is bad is that companies may be supporting slave labor and child labor. Offshoring agreements typically involve a long supply chain that may very well include companies with labor practices which, if publicized in the United States, could destroy your company's reputation. Do you really want your firm associated with little kids who lose their fingers working in unsafe conditions? It is an unfortunate situation; however, this happens a lot overseas.
It is true that off shoring of processes result in growth of unemployment in the country from where the processes are being outsourced. However, that's only one part of the story. Outsourcing results in a higher profitability for the businesses which are then ploughed back into the economy. This definitely has far better impact than the negative impact of growth in unemployment. In fact the negative aspect is broadly nullified by the positive impact of profit getting ploughed inside the economy.
Everyone in business is under constant pressure to produce a new line of work to generate more revenue using the staff they already have. With outsourcing, you can utilize your existing staff to manage outsourced projects. Your staff manages the outsourced team, thus improving the output of each staff member. Outsourcing leverages several factors, including your staff's experience and the productivity per individual.
The number of U.S. jobs lost to low-wage countries has never been officially calculated U.S. companies are not legally mandated to report such statistics. Researchers predict that more than 400,000 service jobs have been moved offshore since 2000 and that number will rise to 3.3 million by 2015. More than 2 million manufacturing jobs have been outsourced abroad since 1983. Economists estimate that the number of jobs leaving the U.S. ranges between 12,000 to 20,000 per month.
Relocated U.S. jobs end up going to workers in developing nations like China and India, countries that pay their employees much less than their American counterparts.
U.S. multinationals cut their work forces in the U.S. by 2.9 million during the 2000s while increasing employment overseas by 2.4 million, according to the U.S. Commerce Department. U.S. corporations employed more than 21 million people in the U.S. and 10.3 million workers abroad in 2009.Blue-collar jobs are not the sole casualty of outsourcing. The McKinsey Global Institute predicts white-collar offshoring will increase at a rate of 30 percent to 40 percent over the next five years; those jobs could include "back office" jobs such as accounting and payroll processing.

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