Someone Explain to Me How Outsourcing Creates Jobs

ItsBboy!
ItsBboy! Members Posts: 398 ✭✭✭
edited January 2010 in The Social Lounge
I hear it causes short term unemployment, but we are actually gaining more skilled and higher paying jobs from outsourcing. One of you social lounge eggheads break it down in laymans terms.

Comments

  • DarcSkies777
    DarcSkies777 Members Posts: 5,600 ✭✭✭
    edited January 2010
    From what I understand about it (which isnt much).

    Our labor is expensive because of federal and state laws that tells companies "you must pay every worker *THIS MUCH* money because the cost of living in your state is *THIS MUCH*"

    Well if ABCXYZ Inc. has a product that they could sell for $100 dollars but because they have to pay American wages they will have to sell for $200 they outsource the job that makes that product to other countries who dont have those pesky laws and can make a child make their product for 5 cent an hour.

    This is why when you call customer service you hear an accent now-a-days.

    The reason we gain higher paying jobs because of outsourcing is because manufacturing jobs are over seas now so the only thing left is the higher paying jobs. The problem is most people only have HS diplomas and there are more higher paying jobs but FEWER (everybody cant be on top). So all-around there are fewer jobs in the market but millions of workers. There are more high paying jobs but way fewer. For example look at a company. There are 1000 workers and maybe 10 managers. The higher up you go the fewer spots their are.

    Anyway....outsourcing is great if you actually own a business. But terrible for the overall economy. Less workers in America paying taxes. Less wages, more unemployed, more crime, domino effect...you get it.
  • Recaptimus_Prime360
    Recaptimus_Prime360 Members Posts: 64,801 ✭✭✭✭✭
    edited January 2010
    it creates jobs alright...jobs to the countries that's being outsourced to. call the customer service line to one of these companies. more than likely, ur callin india my friend
  • ItsBboy!
    ItsBboy! Members Posts: 398 ✭✭✭
    edited January 2010
    I had a professor tell my class a while back that outsourcing is actually good for the economy because it replaces all of the jobs we had with higher paying ones. It's true that because of globalization alot of the "work-horse" jobs are being moved out. And I can see how it would be a better for a country to to be on the managerial/administrative end of that while other countries perform the labor. But like you're saying darc I just don't see how that system could conveniently replace ALL of the floor-level jobs.

    This article says outsourcing creates jobs in the US, but it doesn't say how many it lost.
    http://money.cnn.com/2004/03/30/news/economy/outsourcing/
  • perspective@100
    perspective@100 Members Posts: 1,862 ✭✭✭✭
    edited January 2010
    Its a catch 22... Companies already here that see outsourcing as a way to gain profit will move their labor force and we will lose jobs. Start up companies will begin with their labor force abroad but will still have key positions here in the states. That article says the effect of outsourcing wont hurt the economy because its looking at the company in general, bassically the revenue and its success due to profitability from outsourcing.