As the United States economy rebounds from the effects of the latest recession, many in the media are calling the recovery a jobless recovery, citing the growth of the gross domestic product coupled with a high unemployment rate. Both the media and politicians frequently suggest that the trend to move manufacturing operations and service jobs offshore is the culprit for our economic woes. As a result, legislators are attempting to stem the tide of offshoring and outsourcing through a system of protectionist policies that mandate the use of American goods and services or tax corporations that utilize offshore resources. Both the media and politicians are spending their time and energy on the wrong problem. According to some estimates, offshored jobs will only make up 2% of the jobs lost by 15 million Americans annually (Lael & Robert, 2004). If outsourcing and offshoring are not the cause of job loss, who or what is the real culprit? In short, the culprit is good-old-fashioned, American know-how. Since before the creation of the Computing- Tabulating- Recording Company in 1911, the predecessor to IBM ("IBM Archives: 1900s,"), businesses in the United States have sought the means to improve business performance through the use of technology. From advanced robotics and computers on the factory floor to self-service kiosks at airports and grocery stores, automation has displaced far more United States workers than have migrated offshore (Collins & Ryan, 2007). Daniel Drezner, Associate Professor of Political Science at the University of Chicago also sees technology innovation as the root cause (2004): There is no denying that the number of manufacturing jobs has fallen dramatically in recent years, but this has very little... ... middle of paper ... ...ates Department of Labor. Collins, D., T. , & Ryan, M. H. (2007). The strategic implications of technology on job loss. Academy of Strategic Management Journal, 6, 27. Drezner, D. W. (2004). The outsourcing bogeyman. [Article]. Foreign Affairs, 83(3), 22-34. . IBM Archives: 1900s. IBM - United States Retrieved May 11, 2011, from http://www-03.ibm.com/ibm/history/history/decade_1900.html Lael, B., & Robert, E. L. (2004). Services offshoring: Bane or boon and what to do? Brookings Policy Brief(132), 3. Marx, K., & Engels, F. (1974). The Communist manifesto. Belmont, Mass.: American Opinion. Mencken, H. L. (1949). A Mencken chrestomathy ([1st ed.). New York,: A. A. Knopf. Reich, R. B. (2009). Manufacturing jobs are never coming back. Forbes. Retrieved from Forbes.com website: http://www.forbes.com/2009/05/28/robert-reich-manufacturing-business-economy.html
[3] "Industrial Metamorphosis." The Economist. The Economist Newspaper Limited, 01 Oct. 2005. Web. 9 Dec. 2013. .
The very existence of offshoring is in and of itself evidence that, at least in most cases, it is advantageous for firms to engage in offshoring. However, as is the case with most business activities, its externalities can affect various stakeholder groups in both positive and negative ways. In society’s view, stakeholders to consider are Canadian workers, Canadian consumers, competitors, shareholders and executives, citizens of other countries, and future generations.
of U.S. workers employed in manufacturing has dropped from 16.5% in 1987 to 10.8% today.
For advocates of global business, the hope is that outsourcing will help lift the United State’s economic growth and development by lowering the input cost of services (i.e. labor and materials) and by opening new markets abroad. Mainstream economists believe that outsourcing will have ...
This report is extremely credible and qualified, as it was written by an author who is well-versed on the topic. The author was also the Assistant Secretary of the Treasury in the Reagan administration, making him even more authentic source. Throughout the article, the author discusses and examines the words of two other authors, Ron and Anil Hira, who are experts on the subject of American Outsourcing. These authors are also very credible; one is a professor at the Rochester Institute of Technology, and the other is a professor at Simon Fraser University. Additionally, the author refers to many case studies that were taken at different universities in order to justify his claims on why American Outsourcing is bad. The intended audience is
As the problem of job outsourcing becomes more of an issue in politics, elected officials like the President and Congress will no longer be able to ignore the dilemma. The war in Iraq has been at the forefront of the presidential race but the importance of outsourcing American jobs seems to have been slightly overshadowed. If the issue of outsourcing is not watched carefully and a definitive plan hammered out, a trickling down of negative effects may occur within the U.S. economy. However, there is a polarized opinion on the effects of this “phenomenon”.
The U.S. industries have been outsourcing manufacturing for several decades now. U.S. companies thought they were reducing costs by outsourcing development, manufacturing, and process-engineering abilities. Consequently, U.S. corporations’ knowledge, skilled workers, and supply chain, which are the necessities to producing advanced products, have vanished. For example, almost all notebook computers, cell phones, and handheld devices, which were once created in the U.S., are now designed in Asia. When a major U.S. company outsource, it pressures their rivals to do the same thing. They also lose the expertise of process engineering, which would interact with manufacturing on a daily basis. Minor companies and skilled workers go to where the jobs and knowledge networks are no matter where they are geographically in the world. This decline of trade in the U.S. has caused a negative chain reaction to their suppliers of sophisticated materials, tools, production equipment, and components. U.S. industries do not have a way of coming up with new ideas for the next generation of high-tech products...
Kibbe, C. (2004, 07 09). Outsourcing: the good, the bad and the inevitable. New Hampshire Business Review, pp. 1A-21A.
build a plant in a foreign country and hire local residents to work in it as
...nd again resulting in creation of bigger markets and pulling large competitors and creating new job opportunities, but the problem is with undefined factors like outsourcing, lack of skill development in respect with technology advancement. Technology advancement may be causing huge impact on employment but it is also making human living better. Technology as became part and parcel of our life so we can’t think of life without technology, but to make sure that the same does not harm our livelihood we should keep in track and sharpen and hone our skills with advancement of technology. (Brynjolfsson & McAfee, 2011)
As we move on in time more advancement in technology such as robots are being created to work in the labor force like never seen before. Meaning that employment rates are going to be affected since right now these advancements in technology are replacing labor jobs especially those in factories. As mentioned in the “World without Work” by Derek Thompson the senior editor at the Alantic, “Technology could exert a slow but continual downward pressure on the value and availability of work.” Thompson argues how in the present and in the upcoming future technological devices such as robots will decrease the amount of jobs since it is already happening in factories today. Such as the Ford Motor Company were robots replaced many labor workers already,
A 2014 Oxford study found that the number of U.S. workers shifting into new industries has been strikingly small: In 2010, only 0.5 percent of the labor force was employed in industries that did not exist in 2000. The discussion about humans, machines and work tends to be a discussion about some undetermined point in the far future. But it is time to face reality. The future is now. (UPI Top
When Americans hear the word “offshore outsourcing”, they automatically assume that Americans are losing their jobs to foreign countries. Most of these jobs that companies outsource such as the garment industry jobs are offshore outsourced because they are labor intensive jobs. According to Timmerman
Keeping up with technology is difficult, tiresome, and firms find it very costly to keep at pace with it. Technology rapidly and constantly keeps on changing. Being at par technologically requires extensive research and strategic analysis of acquiring new innovation. Enforcing new technology requires staff retraining and in some cases making employees redundant.