Job Outsourcing Essay Example | Topics and Well Written Essays - 750 words

Job Outsourcing - Essay Example However, the opponents of the view that job outsourcing has positive effect on the US economy argue that hiring people outside the US significantly affect the US economy in a negative way as it strips many Americans of jobs (Kehal, 2006). It is in the light of these arguments that this paper will discuss how job outsourcing exactly affect the US economy. Both sides of the debate have valid points. Ching (2009) observes that studies have shown that outsourcing has contributed to the loss of employment opportunities in the US. This has had detrimental effect not only to those who are minimally qualified for employment, but also to those who have the skills because even skilled labor jobs are being outsourced to other countries (Hira and Hira, 2005). Availability of fewer jobs for unskilled and skilled workers due to job outsourcing has dire economic consequences to the US economy, especially in respect to increasing the levels of poverty and reducing tax revenues and consumer spending. Kehal (2006) argues that while job outsourcing may help companies to reduce costs, it may have detrimental effect on the companies in the end. This is because availability of fewer jobs due to outsourcing reduces spending power of the consumers, thereby reducing companies’ revenues (Hira & Hira, 2005). ... This outcome has a direct effect not only on the federal and companies’ spending, but also on the US economy in general. Job outsourcing also helps to lower the wages and this means that companies will be able to do production with less expense, thereby transferring benefits to the consumers (Kehal, 2006). This is the point that the supporters use to dispute arguments that job outsourcing reduces the availability of job opportunities. They argue that lower prices will lead to increased consumer spending, and that companies will be in a position to hire additional workers in the United States because they will be paying fewer wages for workers outside the country (Ching, 2009). It has also been argued that job outsourcing positively affects the US economy as it gives jobs to people in less developed countries, which improves their economies. As a result, the US is able to increase trade and investments with these countries, therefore promoting the US economy (Kehal, 2006). Besi des, job outsourcing increases the ability of the less developed countries to pay back their debts to the US, which not only promotes better political relationship, but also sustainable economic cooperation and improvement (Wood & Maniam, 2009). However, it has been argued that job outsourcing tend to deteriorate the economic and political relationships with the less developed countries. This view is informed by the argument that not all people in the countries where job outsourcing is done benefit economically from the process. Some of the companies have been accused of not providing humane working conditions (Ching, 2009). In some cases, for instance, outsourced work may be performed in inhumane working