Offshoring is when work is exported to cheaper countries with sufficiently educated work forces.Offshoring is often used interchangeably with the term outsourcing, which is simply subcontracting work to other, more specialized companies.
Offshoring is a concept that is not taken lightly.Whether we like it or not the concept shows no signs of a slow down.The idea has been around since companies have sent work over to other countries to get cheaper labor and increase revenue.In the early 1800's, the British textile industry became so efficient that the Indian cloth makers could not compete.This work was outsourced to England, with disastrous consequences for the Indian workers.Having cars made in Mexico and clothes made in Asia — the idea of making more money for less is part of capitalism.
According to an article from March 30, 2004 in CNNMoney, the consulting firm Global Insight, did a study for the Information Technology Association of America.Global Insight said in a statement, "That, while outsourcing does result in some short-term U.S. unemployment, its long-term benefits outweigh its costs. The cost savings and use of offshore resources lower inflation, increase productivity and lower interest rates.This boosts business and consumer spending and increases economic activity.”This study also stated that the ripple effect led to 90,000 net new jobs in 2003, and could lead to an estimated 317,000 jobs by 2008.The study also said outsourcing added some $33.6 billion to U.S. gross domestic product (GDP) in 2003 and could add a total of $124.2 billion through 2008("Outsourcing Creates Jobs, Study Says,"2004).
"It is unclear how many accounting, engineering, technical support and other professional jobs have moved offshore in recent years.But some industry watchers believe as many as 200,000 service jobs could be lost each year for the next 11 years." The fol…