U.S. Workers and Consumers
Millions of American workers have been displaced due to offshore outsourcing, but millions of jobs have been created as well through the economic growth that outsourcing produces. Since the American workers are most deeply affected by outsourcing, they are of primary importance among all stakeholders in this debate.
American consumers are also impacted by the raising and lowering of prices as companies choose whether to keep certain operations domestic or move them abroad. The long-term economic outcomes of outsourcing tend to involve consumers as well. Likewise, the benefits reaped by consumers and workers tend to occur in tandem, since economic growth often benefits both parties.
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According to economist Dr. Paul C. Roberts, offshore outsourcing results in the loss of millions of white-collar jobs, and more than a third of these displaced workers remain unemployed. Roberts contends that displaced workers have a reduced presence in the consumer market and contribute fewer retirement savings for new investment. Consequently, not only are workers impacted by outsourcing in the short term, but workers may suffer in the long term as well due to its supposed negative effects on the U.S. economy.
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Although many U.S. workers will side with Roberts' assessment of outsourcing, many other economists and business experts maintain that U.S. workers actually benefit from outsourcing in the long run. As stated by Washington Post economics columnist Steven Pearlstein, outsourcing produces increased savings and profits for companies. These savings and profits are spent or invested in the United States in ways that have created hundreds of thousands of jobs in other companies and industries. Therefore, outsourcing produces a net gain in jobs domestically, even though the jobs and workers are not the same as those that were lost overseas.
Pearlstein points out that outsourcing is beneficial not only for investors and executives at firms, but also customers of these firms who enjoy more products at much lower prices. By outsourcing certain business functions, such as manufacturing, companies can afford to invest in high-skill labor domestically and lower prices for consumers. Thus, finding a middle ground in which companies can outsource some business functions abroad, displaced workers can find better jobs, and consumers can still enjoy lower prices is key to solving the issue.