Offshoring and Outsourcing Jobs

Rather than bringing people in to do the company’s jobs, outsourcing and offshoring send the jobs out. Outsourcing means having outside vendors supply services (such as benefits management, market research, or manufacturing) that the company’s own employees previously did in-house. Offshoring means having outside vendors or employees abroad supply services that the company’s own employees previously did in-house.

Sending out jobs, particularly overseas, presents employers with special personnel challenges. One is the likelihood of cultural misunderstandings (such as between your home-based customers and the employees abroad). Others are security and information privacy concerns; the need to deal with foreign contract, liability, and legal systems issues; and the fact that the offshore employees need special training. Rising wages in Asia, coupled with reputational issues, a desire to invest more in local communities, and political pressures are prompting employers to bring jobs back.

Several U.S. employers including Apple and Microsoft are shifting jobs back to America. America’s H-1B visa program originally aimed to help U.S. employers temporarily hire workers from abroad in specialty occupations. Today, newspaper accounts of employers bringing in foreign workers to be trained by their American counter-parts before taking over their jobs has prompted legislators (and others) to argue that the program is misused.