AND IT’S UP TO poor li’l ole us to tell you why, because the media is too stupid to do the job they’re being paid to do.
“Outsourcing” is when your company hires a cleaning service instead of having a janitor on the staff…
…because it’s cheaper for the company. Or because government labor regulations make it impractical to have the janitor on the staff and buying the service from an outside vendor — outsourcing — makes more sense.
“Offshoring” is when multi-national companies set up plants in other countries — such as China — and hires workers there…
…because government, gratuitously meddling in the labor market, makes regulations which have made local labor in the company’s home country uncompetitive. And multi-national companies have to compete in a global market, which includes large, developing countries, and labor costs, being an overwhelming majority of the costs of production, are practically the only place they can cut, and they can’t use fewer people, so they have to use less-expensive people.
And it doesn’t take MUCH of a difference. I’m told that, with only the slightest percentage change in regulatory overhead, American labor (for example), being far more productive than its overseas counterparts, can be competitive. IOW, it’s not the high price of the wages, but of the government’s meddling that loses the jobs offshore.
Which makes the whingeing from government sources on the issue both insulting AND injurious.
When Obama says, “Outsourcing,” he wants you to hear “Offshoring.” Not that there’s anything inherently evil in either practice. AND… not that there’s anything good about a government figure knocking business for the practices — especially when it’s bad government practice which creates the situations necessitating the practices in the first place.
If I were in a position to need the services of potential employees, I would NEVER hire them directly. Because of the meddling of the Federal government in the relationship between employers and employees, I DO. Not. Want. To. Ever. Be. An. Employer.