Title: Outsourcing Overseas and its Effect on the US. Economy
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Content: Companies that outsource to foreign countries tend to hire less skilled workers whenever the work does not require a high skill level to manufacture products. This results in Americans holding higher skill level jobs. It is argued that outsourcing takes away immediate jobs for unskilled U.S. labor. Although this can be true in some instances, the labor employment moved to foreign countries tends to be jobs that pay at a more indigent level by U.S. cost of living standards, leading to impoverished lives to those in the U.S. holding such jobs. Poverty does not benefit the U.S. economy since poverty reduces consumer spending and tax revenues, and increases certain social costs. Also, as a result of cost savings for outsourced goods, these costs savings can be applied to the purchase of additional goods by U.S. consumers, leading to more job creation in the U.S. because of outsourcing. Companies that outsource also have increased productivity because the eligibility of working 24 hours a day, seven days a week due to time zones. Communication systems such as email and video conferencing help coordinate work and increase production details in countries with low labor costs on a 24/7 basis. Thus, outsourcing is an opportunity practiced by all major industrialized countries. An important factor of outsourcing, though, is to consider how the U.S. benefits from these outside investments.