Globalization and the U.S. Economy
Outsourcing is a result of the current globalization rate, due to rise of internet users and communication through broadband. In actual sense, outsourcing is inevitable, and no one is going to eliminate it any time soon, including the United States. However, outsourcing will mean loss of jobs in the United States, leading to a position where these jobs need to be replaced. This is because outsourcing results into competitive businesses, leading to profit and export increase and also increases the opportunities for investments in other countries, different from the source country such as the U.S. In the last decade manufacturing jobs have been moving out of the United States, and this can hardly be prevented. In fact, outsourcing of manufacturing jobs has greatly destroyed the middle class Americans, hence undermining the performance of their economy in general. Competition is mounting on the workers especially...
The concept relates to both goods and services being traded in the markets. This is usually applied mostly in international trade, between two different countries. In terms of labor wages in the United States, the wages will be expected to be equal to the wages of the country they trade with through outsourcing. For instance, if the U.S. outsources labor from Colombia, then the labor wages for the Americans in the United States will be forced to be in harmony with the wages of Colombians in the U.S. In most cases, it is the outsourcing of cheaper labor that results to the reduction of wages in the host country.
