Revised Narrative Writing With Cover Page

So, what is outsourcing? Outsourcing is contracting with another company or person to do a particular function. According to “Wikipedia”, Outsourcing involves the transfer of the management and/or day-to-day execution of an entire business function to an external service provider.” Many large companies now outsource jobs such as call center services, e-mail services, payroll etc. These jobs are handled by separate companies that specialize in each service, and are often located overseas. Outsourced jobs are extending well beyond the manufacturing sector to include white-collar professionals, particularly in information technology, financial services, and customer service. The most prominent advantage for the company who outsource various jobs is that it saves money. Many of the companies that provide outsourcing services do the work, for less money as they don't have to provide benefits to their workers, and have fewer overhead expenses to worry about. Even a democratic and profit oriented country like America has opened its doors to outsourcing, though there has been considerable opposition.

So what are the effects or impact of offshore outsourcing in U.S?

Some of the issues are positive about outsourcing, some are negative. It is important that we look at this issue with regards to both sides of the argument. What are the major risk factors that need to be considered? Economists and industry analysts say that because of outsourcing, companies are saving costs and increasing profit, on the other hand the American economy is suffering since not only the low-paying jobs but the high-tech ones are also moving away from America. They have also been saying outsourcing is bad for our economy and is increasing unemployment and poverty, Outsourcing makes the Company loose control of their process, and they loose managerial control as it is easier to manage their own employees than those working outside. The companies cannot ensure quality of service, they also cannot ensure data security and privacy for example if they outsource processes like payroll, medical transcriptions or other confidential information, they need to have the background and credibility check of the service providers which is difficult. Most of all outsourcing depresses United States salaries.

But is this all true? According to AeA, the U.S. high-tech industry employed 5.9 million people as of June 2007, the highest level since 2002. High-tech manufacturing added jobs for the second consecutive year, 1,800 in the last six months. The high-tech services sectors added 116,600 U.S. jobs in the last six months, a rise of 2.6 percent. It’s evident, that American consumers are benefiting from cheaper prices because of global outsourcing. Companies offshore to save money. They save money because labor is cheaper in many countries. In many cases, personnel costs might be 80% less than in the US. According to Global Insight (USA) Inc. "the benefits of global sourcing" added $33.6 billion to the US gross domestic product (GDP) last year. By 2008, it calculates real GDP will be $124.6 billion higher than it would be without offshore outsourcing.

Outsourcing is not bad for the economy. It is good for the economy as the corporate will have to pay higher taxes. Outsourcing results in higher production and lower costs, and consumers realize the benefit in lower prices and rates for goods and services. The costs savings will in turn lower inflation, increase productivity, and lower interest rates. Global Insight Inc. says real wages are getting a boost as a result of lower inflation and higher labor productivity. In March 2004 the real wage gain was around 0.1%. With increase in future offshore spending which will in turn increase savings and productivity the incremental real wage gain is expected to reach 0.44% in 2008. Off shoring is boosting our buying power, raising employer efficiency and pushing many of us into more rewarding jobs -- jobs that, for the most part, require higher education or expertise. So, while many jobs are moving offshore, the U.S. economy will still benefit. And re-educating and retraining our work force will prepare Americans for new and better jobs.

Conclusion

There is no denying that some of the issues are still unclear about offshore outsourcing but, I believe that it is not bad for the economy. The main reason of offshore outsourcing is to control and reduce operating costs. Bottom line, get the job done for less money. I believe that company’s that make money are healthy companies as they pour money back into the economy, which strengthens the economy, ultimately producing more jobs.America is a global economy and we are competing with the people around the world. As an industry, we'll expand our skills because of offshore outsourcing and avoid becoming stagnant. As a nation, we'll push our boundaries and become more competitive.

References

http://www.acm.org/ubiquity/views/pf/v6i31_bhumika.pdf

http://www.asiawebmedia.com/Definition_of_outsourcing.htm

http://en.wikipedia.org/wiki/Outsourcing

http://socialissues.wiseto.com/Articles/FO3020630100/

http://www.outsourcing-offshore.com/dobbs.html

http://www.cyfuture.com/effects-of-outsourcing.htm

http://www.rediff.com/money/2004/sep/24bpo1.htm

http://www.itaa.org/itserv/docs/execsumm.pdf

Mili, your revision looks great, very informative. I'm going to make a link to the PostNarrativesHere page, so you can learn from peer remixes this week. Be sure to go to the PostNarrativesHere page, as it is a "drop box" and the space where you will find all your peers' narratives. Select 3 for "remixing" and keep up the good work.

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