what impact does outsourcing have on a countrys economy and on business?
Simple American like myself lose their job :(
Did you not read what she posted earlier last night?
http://www.jiskha.com/display.cgi?id=1235007701
yes but i need it for employment and standard of living too.
Unemployment rises and standard of living for many people goes down.
Outsourcing, which refers to the practice of hiring external companies or workers to perform certain tasks or functions, can have both positive and negative impacts on a country's economy and on businesses. Let's take a closer look at its effects:
1. Impact on a country's economy:
- Cost savings: Outsourcing can often reduce labor costs for businesses, leading to increased profitability and competitiveness. This can also result in lower prices for consumers, stimulating demand.
- Job displacement: However, outsourcing can lead to job losses in the domestic market, particularly in industries where outsourcing is prevalent. This can have a negative impact on unemployment rates and workers' livelihoods.
- Economic specialization: Outsourcing may allow a country to focus on its core competencies and specialize in specific industries or sectors, leading to increased efficiency and productivity in those areas.
- Global competitiveness: By harnessing the benefits of outsourcing, countries can become more globally competitive, attracting foreign investments and promoting economic growth.
2. Impact on businesses:
- Cost savings: Outsourcing can help businesses reduce expenses related to wages, benefits, and infrastructure, allowing them to allocate resources to core activities or invest in other areas.
- Increased efficiency: By outsourcing non-core functions, businesses can focus more on their core competencies, leading to improved efficiency and effectiveness.
- Access to expertise: Outsourcing can provide access to specialized skills, knowledge, and technology that might not be available internally. This can enhance the quality of products or services and foster innovation.
- Potential risks: However, outsourcing also comes with risks, such as the loss of direct control over certain processes, dependency on external providers, and potential quality or security concerns.
To evaluate the specific impacts of outsourcing on a country or business, various factors such as industry dynamics, labor market conditions, government policies, and global market trends need to be considered. Analyzing these factors will provide a more comprehensive understanding of the overall impact.