Outsourcing Essay Example | Topics and Well Written Essays - 2250 words

Outsourcing - Essay Example se of two dramatically different effects – while some claim that it will result in layoffs and dislocation for many US workers, most economists believe that it will ultimately strengthen the US economy (Otterman, 2004). Outsourcing should not be restricted as it will be good for the US economy in the long run. With the US economy still recovering from recession, some economists feel that this is not the right time to send jobs overseas. High technology companies have been contracting out many of their software development projects to overseas software companies, particularly to India. Outsourcing has always been a part of the American economic regime. Gradually outsourcing is being done in more and more sectors. It is fueled by a combination of quality services at affordable prices both by the service providers and the consumers. The developed countries could venture into outsourcing as the developing countries have demonstrated the required skills and upgraded the technology in communications (Sourirajan, 2004). Despite claims of job losses no one really knows how many service jobs have been outsourced overseas as companies are not required to maintain such statistics. According to a Forrester Report, US will export 3.3 million US jobs by 2010 and most will be in the IT software development sector (Sourirajan, 2004). By 2015, Forrester predicts, roughly 3.3 million service jobs will have moved offshore, including 1.7 million "back office" jobs such as payroll processing and accounting, and 473,000 jobs in the information technology industry (Otterman). This according to economists is a very low figure as the United States employs some 130 million non-farm workers. Despite the recent economic downturn, according to a McKinsey Analysis, the U. S. economy created an average of 3.5 million new jobs in the private sector per year (Otterman). Outsourcing helps to stimulate the economy, argue some economists. The loss of jobs can be attributed to other factors like