A good deal of controversy has taken place in recent years in the U.S. over the impact of overseas outsourcing. It’s a touchy topic and one that’s worthwhile of consideration. In this post I really hope to dispel a number of the most common misconceptions on each side of the argument. If we do this we will be able to see clearly and make well informed decisions whether outsourcing is suitable for our specific context (and there is not a single correct answer to that question).
It takes away people’s jobs. The most common argument against overseas outsourcing is that it steals from normal Americans. This is an honest concern, especially when we consider the difficult economic recession people in America have been through over the past few years. The breakdown with this argument is that it doesn’t acknowledge the long-term impact of what ends up happening when those jobs go overseas. In the end outsourcing actually forces Americans to do what they do best, innovate. This country has thrived partly as a result of it’s extraordinary ability to innovate. So when entry-level computer programming jobs start moving to other countries, it makes the computer programming workforce figure out new ways to succeed in the computer industry. They’re forced to generate new industries and hence, new jobs. The short-term effect of job loss in the U.S. is canceled out by the creation of new industries and the subsequent jobs that are created by those new industries. It is also offset by the opportunity it offers to competent and bright people who are stuck in poverty because they were born in an impoverished country. In reality outsourcing typically helps lift people out of poverty. It’s a positive for the U.S. and a positive for poorer countries around the world.
It decreases quality . Another typical argument is that offshore outsourcing degrades the quality of the goods and services that are being outsourced. There are some valid concerns in this area. We’ve all experienced irritating customer service calls with someone in some other country whose English accent was unintelligible. That is one good example of outsourcing gone bad. Too many companies have too quickly risked their good reputation among their customers just for the purpose of reducing costs. This is risky. But there are other examples of outsourcing that don’t lead to a decrease in quality. In fact the complete opposite is true. You can end up getting a better quality considering your money goes significantly farther. You can work with the best person because they are still more cost-effective than the average professional in the States offering the same task.