Outsourcing: The Demise Of The U.S Economy

1493 words - 6 pages

Outsourcing: The Demise of the U.S Economy
As many people around the nation are aware of, the nine to ten percent unemployment hike in a span of just 3 years (Fig. 1 U.S Bureau of Labor) is just tearing the United States economy from the inside out. Millions of people in the once mighty U.S work force are now barely making ends meet and thousands more are fighting a losing battle to keep a roof over their heads as the growing unemployment rate consumes every aspect of the economy. Personally, I have seen many good people, and hard workers lose their jobs because big companies are trying to cope with the declining economy and quite frankly, I truly believe that more things can be done to ensure job security. In order to fix the unemployment problem, one must find out the ultimate source from which the problem originates. In this case, the origin of the economic problem is the big companies that outsource jobs to other countries for cheap labor thus, taking away millions of jobs from fine workers. The best course of action in order to solve the outsourcing problem is a three-way compromise between the demanding labor unions, the United States government and the big companies themselves.
Well, what is outsourcing? Outsourcing is “[obtaining] goods or services from an outside source” which in this case the service is cheap labor outside the United States (Dictionary.com). This is the reason why many goods with U.S company names have the infamous Made in China stamp on the product. Well known examples of big companies that outsource jobs to different nations outside of the United States include Hewlett-Packard, Nike, Microsoft, and General Electric. Basically, hundreds of these big companies outsource jobs is because of the contract they have with various nations that provides cheap labor. This notion of cheap labor is the overall or general reason why companies outsource jobs away from the U.S.
Now, if we break down that general reason why the companies are outsourcing, one can see what truly causes this problem. Companies in the U.S use the outsourcing business strategy because of the powerful labor unions and the United States government. On the labor union side of the issue, the unions have grown into power since the Industrial Revolution which is also presents a costly problem for any company. One can witness the power of the union in the news about union strikes at the workplace and how frequently it shows up. The unions often demand higher wages and better benefits from the companies but if both, the unions and the companies cannot reach an agreement, the workers would go on strike. Today, the increased wages and workers benefit demands have been increasing which makes the cost of operation very expensive for the big companies. Although the unions have been making the livelihood of workers better, the union leaders and organizers must be very well educated in the global economy to realize that sometimes their high wage and benefit demands...

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