Global Outsourcing

Paper Summary:

This paper examines the economic motives to the passage of free trade agreements in which trade barriers have been reduced and the demand for low wage labor has increased. As a result, many domestic jobs have been sent overseas while American workers have been displaced. This paper delves into both sides of the labor dispute in which workers argue that the practice of outsourcing is unethical while companies claim the practice is both economical and vital to compete in the global market. This paper examines various solutions to solve the ongoing conflict including implementing a reform system offered by Senator Kerry and detailed in this report. This paper also contains a chart which compares the labor wages in India and America.

Table of Contents:
Abstract
Introduction
Story of a Displaced Worker
American Companies that Use Overseas Labor
The Growth of Free Trade and the Affects on Domestic Employment
The Economic Impact of Global Outsourcing
The Practicalities of Outsourcing to Positions Overseas
How Global Outsourcing Affects Various Parties
Societal Impact
Proposed Solutions
References

From the Paper:

"Foreign workers benefit from global outsourcing because they enjoy economic prosperity. For example, since Indian firms only interview at the top 40 universities, a 2003 report by the Indian Technology Trade Association predicted falling demand for professional services by as many as 235,000. However, global outsourcing contracts from companies like the United States have led to the mass hiring of recent Indian college graduates. Their salary is twenty to thirty percent higher than prevailing wages. Such industries that have grown tremendously over the years include: intellectual technology, research and development, telecom, banking, diagnostic, pharmaceuticals, and automotive. Since more disposable income has been created, retail has also grown tremendously. Retail stores such as Tommy Hilfiger and Wal-Mart are expected to open a number of chains within the next several years. These stores will employ more Indians and increase consumer spending."

More papers on Global Outsourcing:

• Term Paper # 109888 : "Global Outsourcing"
• Analytical Essay # 3904 : "Global Outsourcing in American Industry"
• Business Plan # 57658 : "Outsourcing"

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