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Essay 2 How outsourcing affects the analysis essay US economy is a matter of great debate. For those who speak for the international business and globalization, this practice will have an overall positive effect on the US economy – since it is economical for companies to hire less expensive work force of other developing countries, opens up opportunities for greater entrepreneurship in the US, and leads to more Americans holding higher level jobs. Critics suggest that hiring foreign workers has an immediate effect on the US economy by stripping many Americans of jobs they would have performed, particularly by semi-skilled or skilled laborers as all the American population is not to be placed at higher level of managerial hierarchy.
Unfortunately, with fewer jobs available for unskilled workers, people may find themselves in exceptional poverty. Poverty does not benefit the US economy since it reduces consumer spending and tax revenues.
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When people don’t buy, corporations that produce things don’t make money, which can thus “trickle down” to fewer jobs available and a greater desire to outsource to make things more cheaply so they will be more attractive to consumers. Those supporting outsourcing say that lowering expenses of corporations will create jobs. There are plenty of government agencies that outsource some of their work, saving millions of dollars which has a direct effect on the US economy.
This is a problem for those Americans in certain who are needy and might take jobs that require minimal skill, but due to outsourcing it is now much harder to get jobs of this type. When President Clinton enacted the Welfare to Work plan in the 1990s, he was attempting to encourage people to get back to work so as to reduce government spending in welfare.
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