offshoring_share

offshoring_share - In 2003, the United States was...

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In 2003, the United States was experiencing a jobless recovery with employment levels well below those in 2000. A widespread theory began to name the major culprit for this issue was the growing practice of U.S. firms moving part of their domestic operations to lower-wage countries abroad. It is presumed that off shoring caused the reduction in US output and a significant loss of jobs. In fact, after the 2001 recession, U.S. domestic production began to rise tremendously but instead of employment rising it began to decline due to output. What is off shoring or global outsourcing? There’s no official term or definition but it has come to mean that American companies are relocation some parts of their domestic operations to a foreign country. By domestic operations we mean programming from software firms, record-keeping activities from businesses and automotive parts from car companies. The immediate effect of an increase in off- shoring is a direct reduction in U.S. employment. This could be a rise in the number of layoffs or a slowdown in new job creation. The only benefit seems to be the lower prices in consumer and investment goods made possible by off shoring raise real wages and living standards in the United States while consumption and investment spending rise and employment recovers. The American labor market has faced pressures of a competitive global labor
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This note was uploaded on 10/23/2010 for the course HUM HUM 100 taught by Professor Smith during the Spring '03 term at Strayer.

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offshoring_share - In 2003, the United States was...

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