Offshoring, The Dark Side Of Globalization

June 5, 2011

More and more people in the U.S. are now asking the question, “Is it possible for my job to be outsourced?”

According to an online report by The Arizona Republic, it’s the middle class that stands to lose their jobs or get stuck with lower wages due to outsourcing. Low income jobs like janitors and waiters do not have to worry, since these jobs require on-site labor. The same is true for high end jobs like surgeons, and legal professionals.

A study done by Harvard Business School suggests that about 2 out of every 5 jobs could be outsourced. This is could be an evitable side-effect of the globalization era, writes Betty Beard of azcentral.com. Outsourcing has been a reality in Arizona with computer programmers and call center staff losing their jobs to foreign workers. With radiologists in India looking at X-rays of Arizona hospitals, there is much to be said about creation of American jobs.

Nonetheless, President and CEO of the Greater Phoenix Economic Council, Barry Broome, is of the opinion that Arizona has escaped the worst of offshoring.

He adds, “I think we are one of two or three markets least impacted by offshoring. That’s a backhanded compliment. It’s primarily because we don’t have mature industries and high-tech manufacturing.”

Although globalization has seen its benefits for companies, there are also disadvantages associated with it. Cut throat competition has become fierce in a rat race to book profits that manufacturing is shipped overseas at the expense of American jobs. In effect, it shutters down U.S. factories. What happens is that global market forces make it more difficult to set up shop locally, when the same process can be done cheaper in a faraway outsourcing destination; some of the big Asian outsourcing countries include India, China, Philippines and Vietnam.

On the other hand, there is substantial demand for ‘Made in the U.S.’ products in countries such as India. This is primarily quality driven. And one way to offset outsourcing would be to spike exports, now valued at $14 billion in Arizona.


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