The so-called crisis in outsourcing labor, means sending American jobs overseas which results in more unemployment here in the USA. The argument is if we just stop allowing the outsourcing of labor overseas then American companies will be forced to hire Americans. What gets lost in the translation is that up to 70% of all outsourced jobs in America actually stay in the USA. This means only up to 30% of all outsourced jobs in America actually go overseas. American companies actually outsource 70% of the jobs in America from state to state where taxes and operating costs are lower and the labor force from state to state may be acquired cheaper.
Critics and politicians charge that outsourcing is un-American. However, government intervention impeding the growth of business and limiting free trade as well as limiting what companies can do to grow and prosper may be even more un-American.
In fact, the most successful U.S. companies that create the most jobs for Americans in the U.S. are those companies that are the biggest outsourcers of labor from state to state and overseas. Outsourcing actually creates more jobs for Americans here at home because as an American company grows the more people it will hire right here in America. If a company did not outsource to save money for labor costs the less profitable it becomes and the more people that company will have to let go or not be able to hire here at home.
When you hear the argument about millions of jobs being lost overseas due to outsourcing, consider this. Since the early 1990’s, to date, about 360 million jobs have been lost yet 380 million jobs have been created during this same time.
Outsourcing can actually create more jobs here in America in the long run at the same time provide more choices for cheaper goods as well as keep prices lower on imported goods. Victims of outsourced jobs may also be victims of recessionary times and may not have always lost their jobs solely due to outsourcing. Moreover, some people who do lose their jobs to outsourcing have actually ended up in better paying jobs or landed jobs with an easier workload than they had with their previous jobs.
Outsourcing creates opportunity and it is hard sometimes to see the benefits of free trade when the news media and politicians trying to get elected too often only point out the layoffs and plight of workers whose jobs were outsourced without consideration for the whole macro-economic picture of all things and people involved.
SUPPLEMENTAL SOURCE: ABC-TV 20/20 JANUARY 28TH 2005