Outsourcing Jobs to Foreign Countries

by: Luis Lowenberg

Outsourcing Jobs to Foreign Countries creates an increase in unemployment in the United States. Is it proper for corporations to move their manufacturing divisions to other countries and leave the American people jobless? What impact has outsourcing had on the economy?  What concerns are American’s developing about the effects of outsourcing on their livelihoods?

Yonkelvich conducted a survey, which found that 87 percent of American’s that he surveyed experienced some type of concern in regards to their work being outsourced, and at the same time another 52 percent of the surveyed said that they were worried a great deal. With Such percentages as this, it is no wonder the government has received low grades by those surveyed which included low scoring of C’s, D’s and F’s which was an actual of 81 percent of those surveyed. With such low grades as this, it goes to show that the government is not addressing the issues of outsourcing American jobs to foreign countries (Yonkelvich 2005).

Yonkelvich in the same survey taken, 74 percent of U.S. citizens do not believe that American manufacturing companies would not keep their facilities in the United States. This in part is due to companies not having to pay higher wages. Many of the surveyed can’t understand why the government is not doing anything to prohibit the outsourcing of their jobs to these other countries. So why is the government not doing anything about this issue of preventing these manufacturing companies from moving over seas? U.S. Foreign Policy needs to change. The government needs to take a hard look at this problem and should start by limiting the amount of jobs, which are being shipped overseas (Yonkelvich 2005).

In today’s United States (Merrifield 2006) states that growing and developing countries, would develop manufacturing and specialty services 28 with in the next ten years of which about half would be of those countries. To think that 1.5 million of those types of jobs have been already shipped overseas with another 4 million expected to be outsourced by the year 2008.  This number is likely to exceed the 8 million. This is way, too many jobs lost in the United States due to outsourcing or off shoring, which is another term for outsourcing, which Merrifield uses.

A car manufacturing company (Meyerson 2006) decided to eliminate by means of outsourcing the production of a luxury vehicle to Mexico, which in turn caused the loss of jobs for 2300 employees. The same company turned around and determined that another 34000 more employees would be jobless as well as proceed with the moving of 14 factory facilities by 2007. Ford is this company, and jobless workers with seniority, fear that Ford will not offer any type of employment for them in the future. Even those employees who qualify for retirement are skeptical that the company will dishonor its commitment towards them once they are displaced. How shameful this is to see a big corporation such as Ford treat their employees who have many years of service with them in this type of manner. A company, which has been around for a long time, to decide to move their facilities to other countries in order to cut cost and increase their bottom line, how lame can that be. To see other companies follow in the same suite, it is happening and we need to put a stop to this type of business practice.

The economy is not anymore prosperous than a number of years in the past is a concern in America (Meyerson 2006).  In our high-tech sector the acceleration of the trade deficit is growing at an alarming rapid pace. The $15 billion that we had in 1999 in surplus is no longer instead it is $44 billion in deficit. This reason is not due to specialty jobs but instead the lack of creating these specialty jobs. American corporations are choosing to move their facilities to lower paying countries. These corporations are focusing too much on their bottom line versus their employee benefits.

Steven P. Jobs (CEO) of Apple Computer seems to think that people in the United States are exaggerating to some degree. A big part in the labor industry, which consists of high technology parts are actually being kept in the United States. In terms of education, the United States would actually surpass foreign nations. There are plenty of well-educated workers in America, which in tern is a positive for those creating new technology. There are figures showing that 30 % of American citizens ranging from 25 to 34 years of age have a higher education compared to that of Japan, which is 24 % and Germany, which is 14 %.  Thus, by the U.S. having a better-educated society, it goes to show that America can adapt better in a fast growing market. The largest threat that American’s face, is not so much the competitiveness of other nations but the rapid growth in which they are expanding.

Education in the United States is part of the actual cause of future jobs to be outsourced to these foreign countries. Some of these foreign companies are the cause for American income to be threatened. The one way this can change is if dramatic changes occur from a political standpoint. In the Bush administration there does not seem to be much of a concern on this crisis. Policies need to be placed in order for American companies to keep their profits in the United States. These policies need to be implemented in order to protect jobs here in America. Corporations should be able to be compensated in order for them to be able to reside in America, keeping jobs stable without having to outsource them out to other nations. Outsourcing not only creates job loss but it also creates language barriers (Meyerson 2006).

We need to train and educate our workers in order to reduce outsourcing (Lynch 2005). A major reason for outsourcing is the lack of education in the U.S., compared to other nations.  Too often, American applicants do not possess the required qualifications for certain specialty jobs, located in the US. Hence, many of these types of jobs are being outsourced. Encouragement among our young as well as others is beneficial in order to fulfill the requirements, which corporations are requesting. Fact is that undereducated workers tend to have the highest rate of job displacement and even so, those who are reemployed are being employed at much lower wages than they are used to before they lost their jobs.

Interesting to see how companies are not taking the time to invest on training for their workers who have a lower education (Lynch 2005). Could this be part of the reason for companies to outsource? There is $1 billion not being spent on training compared to what was being spent over a decade ago for the same type of economical state (Lynch 2005). Policymakers need to step up to the plate and protect those types of training programs, which are federally funded.

The real estate industry as well is being affected by outsourcing jobs in the United Sates due to the loss of rental revenues of $1.2 billion. This type of loss seems to be increasing on a yearly basis. Loss of millions of American jobs to foreign companies is occurring unnecessarily due to the low wage being offered by the competition overseas. In order for the United States to be competitive in the world market of today, federal and state governments, need to step up to the plate and provide the proper training necessary along with investments, perks and a positive environment which businesses need. With the loss of 3 million labor jobs in the early to middle 2000 and 2004, an expected job loss could reach 5.1 million. With this type of losses the affect to the real estate market will suffer in all aspect of the business (Author unknown 2006).

Policies need to be put in place. This needs to occur in all levels from federal to state. Even local bureaucracy is part of the change, which will protect jobs here in America. Again all this leads to training. Officials from the President of the United States on down the ladder need to take responsibility and become knowledgeable with this on going and growing concern. Funds as well as training need to be directed towards investment on technology as well as training (Author unknown 2006).

Government policymakers need to change the way the US businesses do business abroad? They need to fix this on-going problematic issue, which only seems to be growing on a yearly basis. Policymakers need to create laws in order to protect workers from corporations who decide to outsource in order to enlarge their bottom line or profits. The longer we wait to create such laws, the more jobs will be lost in the United States. Penalties should be placed upon corporations who decide they want to move their manufacturing facilities overseas. Corporations should be proud to be American; they should show their patriotism in the same manner and keep jobs here in America.


Yankelovich D. “The tipping points (illegal immigration from islamic countries).” Foreign Affairs 85.3

 (May – June 2006): 115. InfoTrac OneFile. Thomson Gale. Apollo Group. 11 June 2006.


Merrifield, D.B. “Making outsourcing a core competency.” Research – Technology Management 49.3

(May – June 2006): 10(4). InfoTrac OneFile. Thomson Gal. Apollo Group. 11 June 2006.


Meyerson, H. “Not your father’s Detroit: the motor city virtually crated the old era of shared prosperity. Today,

the middle has fallen out of the economy. What can we do to get it back? (Report).” The American

Prospect 17.4 (April 2006): 16(5). InfoTracOneFile. Thomson Gale. Apollo Group. 11 June 2006.


Lynch, L.M. “Job loss: bridging the research and policy discussion.” Economic Prospectives 29(9).

(Summer 2005): 29(9). InfoTrac OneFile. Thomson Gale. Apollo Group. 11 June 2006.


“Not enough is done to keep jobs in U.S., study says. (Residential).” Real Estate Weekly 51.16 (Dec 1, 2004):

23(1). InfoTrac OneFile. Thomson Gale. Apollo Group. 8 June, 2006.               


Mandel, M. J. “Commentary: Outsourcing Jobs: Is It Bad?” Business Week Online (August 25, 2003): News:

Analysis & Commentary.