Is Outsourcing Unethical?
With today’s economy, the confidence and trust in our business and government leaders have Americans putting their money under their mattresses. The “microwave-generation” mentality has Washington scrambling, putting pressure on companies to find ways to increase their profitability to appease shareholders, as power-hungry politicians manipulate to keep their jobs in the next term.
The outsourcing of cheap labor to foreign countries is one example of the strategies employed by U. S. companies seeking to survive or to increase profits. In particular these days in the outsourcing of customer service departments and manufacturing. Not that outsourcing is solely a product of an unhealthy economy.Even during times when the economy is booming, cheap labor has been used, supposedly out of greed or the need to fill jobs that Americans are unwilling perform.
Do you believe it is ethical for U. S. companies to outsource cheap labor to foreign countries, while unemployment is at 9.4% nationally and rising? In addition, do you believe such practices will shoe up customer confidence? Is this an issue of nationalism versus globalism? What are the implications of “free trade” on this issue?
[Unemployment percentage resources from The Bureau of Labor Statistics www.bls.gov]
This post was prepared by James Scott.
Outsourcing is an inevitable response to globalization—international free trade. Outsourcing in itself is not illegal or unethical, but the repercussions of outsourcing experienced in America are considered to be unethical for the following reasons: American citizens, educated in America for the purpose of employment in America, are displaced from jobs by foreign workers; outsourcing lacks regulation to protect personal and sensitive information; and the American government offers no effective solutions to address these repercussions by re-training and re-employing displaced workers, and by offering incentives for businesses not to outsource.
[http://www.usc.edu/org/InsightBusiness/archives/fall2005/TheEthicsofInhouse.htm]
Good comments on American beliefs of the “unethical” practice of outsourcing. You stated one thing I had not thought of and that was the offering of incentives for businesses to not outsource.
I do agree with Fra4469, that this country was built based on immigrant labor in mind. If that helps the economy in America, then it will benefit everybody in the country one way or the other.
Personally speaking, there are two ways of looking at it. It is ethical because it is the same concept that companies use in America. If you had two people from America who want to do your work, but one is willing to do it for less than the other. All other factors equal, obviously you would chose the one that does it for cheaper. In that situation, one American loses a job. Now if this same concept is used for outsourcing, what is wrong with that? If that same job is given to a person outside for a lot cheaper, it is the same concept. Everybody wants benefit for their own company so I see nothing wrong with that.
Another view is that the people working outside of America for cheaper are living in a different economy. An American loses a job to a outsider because he/she demands more, but the cost of living is higher in America than the countries the jobs get outsourced to. So it is unethical for a person in a lower cost of living country to take a job for less than a person living in America, where more money is required just to survive.
Looking at both of the view, you have to do what is best for your company. So the ethical thing to do would be what your company’s vision and mission is. According to that, they should decide how they want to go about getting their work done.
Yes it’s up to the company’s vision mission on why and how to outsource. The company I work for does outsource for the reduce cost reason but also does treat all outsource employees with respect and offer benefits similar to the US employees.
Your company may be one of the few that treat outsourcing with those benifits and respect. My question is how are they saving enough money to justify outsourcing? I do agree it is ethical if done right, however I do think we need to consider wether it is being done for more profits (greed) or as a necessity of remaining in business.
I personally don’t see how. Just think they can hire four engineers for same salary of one here
My guess is that they are saving money by outsourcing, however I would think there would be other benifits as well that would justify outsourcing. The company may be closer to the raw materials that is used in the production or closer to the market they sell to. The Japanese auto manafactures brought some of there production lines to the U.S. to be closer to this market.
My personal opinion to the question is outsourcing cheap labor ehthical? The answer is …..maybe…….it depends upon your point of view. If we do not outsource to the cheapest labor rates, is that doing our best for the stockholders and investors? Do they not dserve a reasonable return on their investment? Hw many American jobs are lost? Do we really have people that would do this kind of work? Is it fair to pay low wages in other countries? How many people working in factories and “sweatshops” overseas could make more money working somewhere else in their native country? They are not being forced to work. Let’s go even further and look at the migrant workers here in the United States. We all protest that it is unfair the wages they earn, but most of them are more than happy to do the job, and live a better lifestyle than in teir own country. And do we really want to pay twice as much for the produce as we already do?
I have rambled on, asking mre questions than I have answered. Here is my final answer, it may not be right, but I am stickng with it. It is not unethical to outsource labor to foreign contries if the total cost is cheaper. It may not be the best for our current financial situation, unemployment is high, and people are struggling to make ends meet, but if we cannot offer our products cheaper than our competitor, we will be out of business. I don’t agree with outsourcing, but I would highly reccomend it under the extenuating circumstances.
Outsorcing in enevatable in a free economy. Yes we could lock down and only buy withing the US but then we would find ourselves as many third world countries already do in poverty. We built this country with imigrent labor and it will be imigrent labor that saves this country from finachial ruin. We need to reevaluate the needs of our country and adjust our production to meet that demand. It is energy, education, health care, and transpoertation that keep us on the top of the food chain so let’s go after what we know we need. GM has unvieled thier new car the Volt with it 230 MPG it is just what this country needs to break the old barriers and rethink how we do things in our own country. It makes me ill when I hear that there are jobs that Americans won’t take. That is not it these companies are looking at the bottom line, money!
I agree that it’s hard to hear that outsourcing fill jobs that Americans won’t take or unwilling to perform. I don’t think that is true especially in this current economy time.
Just for everyones informaiton Fra4469 is Frank R. all posting are for fall 2009 ENGM 551.
I am new to bloging and wonder where the students from UTC are discusing Dr. Chopra’s lectures?
Right here.