Outsourcing: Pros and Cons

Outsourcing is defined as “to send away (some of a company’s work) to be done by people outside the company” by the Merriam Webster website. In the past, not that many companies had to outsource as they remained profitable. But as the economy worsened, companies began to look for ways to minimize their overhead and expenses while still remaining competitive. Outsourcing was and still remains a viable option that many companies have chosen to utilize in different aspects. Some companies have closed “divisions” within and given the responsibility to other companies as they see paying someone else to complete the task as a cheaper option. Other companies actually branch out overseas to other countries where labor is cheaper as well as overhead and have delegated tasks to these “off-site” branches.

Unfortunately this typically forces companies to downsize their workforce, which has happened to numerous American companies. The lack of jobs has forced over-qualified individuals to seek jobs elsewhere or go back to school in an effort to learn new skills. And while community colleges and other universities are enjoying the increase in enrollment, this has left many Americans jobless and frustrated. Fresh graduates are also having difficulty finding jobs that are hiring as well. Individual states have been trying to entice companies to build factories and create jobs for their local job markets. (Example: New York State offered over 1 billion in incentive packages to get Global Foundaries to build their Fab 8 facility in Malta)

So outsourcing arguably has both a positive and negative effect on society, especially within the USA. Our personal views on outsourcing really depend on what industry we are currently in or hope to work in. My personal opinion is that the negative outweighs the positive, as outsourcing has displaced many Americans from their jobs that are being done by someone else.

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