Monday, May 14, 2007

Here is my fifth and last post.

Globalisation and Outsourcing in the US:

globalisation has caused many companies in the US to outsource, because companies can now employ other people to do less important jobs, and they also do not have to pay much, and yet can remove a burden and thus can concentrate on other economical affairs.

Ousourcing has become increasingly popular among US companies since globalisation. US has outsourced many jobs to foreigners, causing the number of jobs available to the locals to become lesser and lesser. Therefore, this has caused many people to suffer from unemployment. for example, "The loss of jobs in San Jose in 2001 and 2002 was huge, second only to New York City -- a much larger area that was uniquely wounded by terrorism. In 2001 and 2002, San Jose lost 120,700 jobs. Unemployment peaked at 8.8 percent in November 2002, falling to 7.1 percent last November. ". Another example is "Grand Rapids lost 17,500 jobs in those two years, which was nonetheless the 29th worst job loss among 319 metropolitan areas. Unemployment in Grand Rapids peaked at 8½ percent in July, falling to 6.8 percent in November."

Another problem caused by outsourcing is the loss in quality of products and services. Since companies outsource, they are unable to frequently monitor and check the quality of goods or services produced by the companies they outsource to, therefore sometimes resulting in worse and worse goods being produced, causing the reputation of the company to be tarnished.

Thus, when deciding whether to outsource or not to, companies have to consider the pros and cons. and also, if they decide on outsourcing, they have to constantly monitor the quality of their output, so as to prevent the problem of low quality goods from happening.

references:
1.http://www.cato.org/dailys/02-16-04.html
2.http://en.wikipedia.org/wiki/Outsourcing#Benefits_of_outsourcing

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