Off-Shore Outsourcing
Posted Feb 06, 2004

On the plane to India this trip, I met and had conversations with three executives and representatives of different companies, all of whom are involved in outsourcing. Critics of this move by numerous U.S. companies to outsource certain jobs to countries like India and China say that the loss of these positions is hurting the American economy. Certain commentators speak about our broken borders and blame the problems of the economy on those companies exporting American jobs overseas. Many with this viewpoint want to build a wall around America to prevent or greatly reduce our immigration levels. By spreading prosperity into developing and other nations and providing jobs there, however, these U.S. companies take away much of the attraction of immigration, so immigration restrictionists could be pleased by the fact that this makes the United States less of a magnet to many nationals of other countries. A fact that just cannot be ignored is that incessant delays in processing temporary work visas, as well as other applications and petitions, have also tarnished the once shining appeal of opportunities in the U.S., also tempting American companies to look outside our borders when certain skilled workers cannot be found among available U.S. workers in a timely manner. In the early 1990s, it was dismissed as being an unrealistic possibility that the U.S. could lose jobs if the federal government did not greatly improve the speed and efficiency with which cases were processed. The perception then was that the desirability of working and operating businesses within the United States would remain constant. We now see that those perceptions were misguided and the predictions are proving to be true, taking many by surprise.

Proponents of sharing technical and human resources the world over speak about a global economy and the forces of pure capitalism that drive businesses to seek the best work product at a cost that is competitive and economical for consumers to absorb. Businesses talk about freedom from labor restrictions that tie the hands of employers and prevent them from doing business since, in the U.S., they are often mired in legal matters that consume their time, resources, and energy. The allure of operating in countries where laws allow for the most effective use of human resources is attractive. Of course, what is reasonable and fair on one side is unreasonable and unfair on the other, since there is also the argument that the laws of developing nations do not protect those workers who are the most defenseless. Still, at this point in time, some would say that any employer not on the outsourcing bandwagon, is not only missing out on a golden opportunity, but may have taken the first steps towards losing any remaining competitive edge. Therefore, many large companies, previously unconvinced, are no longer straddling the fence on this issue.

Needless to say, this is a hot topic and likely to be debated vociferously by anyone with an opinion. While we expect other nations and cultures to examine themselves on an on-going basis, it appears it is time for our country and our leaders to examine U.S. laws and policies to consider whether we need to stem the tide of outsourcing or if it will actually benefit the country over the long term. I recently heard a new turn of phrase regarding the outsourcing phenomenon. "Geography is history." Only time will tell, but it may not take long!

~ Sheela Murthy