Manufacturing Industry Moving Abroad
The problem of manufacturers relocating to different areas of the world to produce goods is a problem that has been around for decades. The appeal for manufacturers to move overseas is clearly seen. According to Sen. Carl Levin, “Cheap labor, no safety standards and no environmental standards” (2) are prime reasons why many jobs are being moved overseas. According to the Labor Research Association, “The new attention in the media to the export of jobs did not develop until white-collar jobs began to evaporate along with manufacturing jobs and no replacement jobs appeared. The export of jobs is no longer just a question of factory jobs. Forrester Research reports that 3.5 million U.S. white-collar jobs will move offshore by 2015-about 200,000 jobs a year- to low-wage counties such as India, China and Mexico” (Exporting the Blame 1) Wages in these counties compared to that of the United States are a clear indication of why manufacturers are so eager to try out the overseas markets. According to the Labor Research Association, A U.S. Company can hire a software developer in the U.S. for $60 an hour or one in India for $6 an hour. So what’s to be done to combat the desire of companies to move to other countries? Therefore, in this paper, I am going to explain the reason in depth why manufacturing companies especially in the industrialized countries move abroad, the merit and demerit.
The last few years have seen a remarkable number of companies in industrialized nations such as America moving overseas, resulting in the loss of many jobs in the US economy. While manufacturing companies have taken their operations overseas for decades, the trend is now also happening in the service industry, and the pain of the bite is too much to ignore. Though from my research, there are a lot of reasons for such decisions by these companies, but things are always works in two opposite directions, in other words, this remarkable movement by some of these companies can add both negatives and positives value to the environment. In the 1900s, the United States was booming. Companies set up shop on American soil and hired well-educated, motivated American workers to manufacture and sell their products. More recently, free trade and an ever-globalizing economy have encouraged American businesses to move their manufacturing facilities overseas, where they can employ less expensive labor with fewer regulations and ultimately sell their products to the end consumer at a lower price. At first glance, lower prices appear to be a good thing, a way of getting more products into the hands of more people more rapidly. However, a closer look reveals there are still many benefits of manufacturing in the U.S. vs. overseas.
The paper is going to focus on the reasons why many manufacturing companies offshores to foreign countries. There have been serious issues especially in the industrialized nations like US concerning the effects of their domestic manufacturing company’s offshores. Using United State as a case study, recently, many industrialized nations such as US has been in debate on the factors that causes the increase of unemployment, workers welfare, and how to bring their various reputable companies whom relocate to another country back home. Therefore, this paper intends to provide an insight about the reasons why this companies offshores, the advantages and disadvantages of such movement, and also why most of them are reshoring. My research will be draft from the different articles of the professional researchers that analysis these issue in their various respective perspective.
Keywords: Offshoring; low wages, access to material, no employee benefit, no pension, don’t have to comply with safety and environmental regulation and don’t have to pay foreign taxes. Reshoring;
Probably the most common reason that manufacturing companies...
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