The meaning of offshoring, or in other words, “Offshore Outsourcing“, is quite simple. It can be basically defined as the relocation of business processes (including production/manufacturing) usually overseas, to a lower cost location. It involves companies contracting out their work with other firms located in other countries, to perform a specific work that is normally performed in the United States.
But what could be the driving force behind offshoring? Money. A firm contracts out with another firm overseas, then comes a deluge of benefits. From producing and distributing their products, the service provider gets these benefits. They can even provide the service for as low as $1 a day. In addition to this, studies show that the outsourcing practice is gradually increasing. The said practice is contrary to American workers, as it happens to decrease the United States’ employment rates, having those jobs held by foreign workers that would have been done by American workers.
The internet is considered to be of big help, as it adds convenience in outsourcing. Indeed technology has become more sophisticated and yet less expensive in most countries all over the world, thus, resulting to globalization which then enables US firms to offshore jobs at lower rates, rather than employing domestic workers. A part of this is also said to be a reason why offshoring is having controversies all the time. A number of CEOs and employees foresee offshoring as basically the next step in the world of IT(Information Technology). Others though, perceive offshoring as a probable cause of unemployment. A number of them argues about whether those jobs must be done overseas or not, just because it is a lot cheaper to do so.
Whether you are a pro or a con, offshoring still is undoubtedly gaining popularity. In order to appreciate the phenomenon which offshoring has on jobs in America and the worldwide economy, a good way is to get help from an outsourcing professional to eventually have more information regarding the practice.
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