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Outsourcing It Department Essay

1646 words - 7 pages

Economists study the ways people earn a living and provide for their material needs. They study how people behave as a result of a change in price, income, or other variables. Many are employed in business and industry but there are many different areas of economics that economists specialize in. Industrial economists study many different forms of business organization. They study the production costs, markets, and investment problems. Agricultural economists study farm management and crop production. Labor economists study wages and hours of labor, labor unions, and government labor polices. Other fields of economics include taxes, banking, international trade, economic theory, and comparative economic systems. Some economists specialize in inflation, depression, employment, unemployment, and tariff polices. Others specialize in investments, the utilization of manpower, business cycles, and the development of natural resources. Societies are interested in economist's conclusions because they keep us up to date with how the market economy is holding itself up. They give us information on how our wages will be affected, how prices on goods will alter, and how demand on products will go up because of certain decisions we make.Outsourcing has become particularly common in the information technology industry. Highly skilled positions that were once thought secure are now regularly finding their way overseas to places like India and China. Big corporations claim that there are not enough properly trained and educated workers in the United States. Labor advocates say it is all because a computer programmer, in say India, commands perhaps a third of the salary of his American counterpart. While the international human rights advocate sees the outsourcing process as a necessary step in the development of the developing world; a weapon in the fight against poverty and parochial prejudice. Still more interesting, is the argument that outsourcing is an unavoidable consequence of the dot.com collapse. It is as if the supporters of this theory purport that this stock market disaster was proof positive that American companies simply can't compete with American labor and much more significantly with American wages and prices. A leader in the outsourcing rush has been IBM. As one of the world's leading information technology companies, it employs hundreds of thousands of people across the globe, and sets standards that others are bound to follow. IBM's stance on the issue is especially significant given the industry's dominance by only a very small number of large corporations: IBM, Microsoft, Hewlett Packard, and handful of others. Using IBM as our prime example, we will examine the industry itself, IBM's own corporate policies, and all of the various political and social arguments for and against the computer giant's course of action.A perfect example of this situation can be gleaned from a quick look at the latest available figures on the IT industry; IBM...

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