Capitalism is an economic system that has been used in the United States to make it the economic superpower that the country is today. Capitalism has long been touted as the economic system which provides the most success and profits for any nation. Concepts of free trade with other countries have allowed the United States to make profits from international relations and business. However the use of cheaper labor and outsourcing has resulted in the free trade system working against the United States. In International Business the issue of moving white collar jobs overseas is explored to demonstrate the negative impact the business practice is having on the United States economy.
The discussion in the text does not revolve around the outsourcing of factory jobs overseas, which we have become accustomed to and understood as the United States no longer manufactures products. Rather the focus of the discussion is on how upper-level professional positions are being moved overseas. Hill (2007), discusses the negative impact that this can have on the nation’s economy. “Economics have long argued that free trade produces gains for all countries that participate in a free trading system, but as the next wave of globalization sweeps through the US economy, many people are wondering if this is true, particularly those who stand to lose their job because of the wave of globalization.” (Hill, 2007 189). The loss of employment due to factory position heading overseas has been a long-standing concerns of the working class. However the shift of white-collar positions overseas results in not only the loss of jobs but also the drain of knowledge and valuable resources from our country. Hill discusses the move of positions from Silicon Valley and companies like Bank of America to overseas nations. This discussion is of value as the loss of jobs and knowledge can have a drastic impact on the United States economy for years to come.
Hill does a good job of highlighting the issue from the perspective of loss of jobs for professionals. While most of the discussion usually centers around blue-collar positions, the article does not touch upon these issues. The article could have been improved by mentioning these positions as they do impact the labor market and unemployment rates. However, the focus on professional jobs is important as the students reading the book will eventually go out into the working force to find that positions that they were hoping to obtain are no longer available to them. They may change their career goals or lobby their politicians to make changes to international business laws.
Discussing the knowledge drain is also a valuable point to add to the discourse. This would allow policymakers to either implement policies which would prevent companies from outsourcing professional positions or implement increased educational programs which would create new positions or opportunities for individuals. Now that the individuals in upper positions are at risk of having their position shipped overseas there may be more off an effort to curb outsourcing which was not done when factory positions were being affected. Hill does not provide concrete solutions to the problem that would have been beneficial. The international relations and political issues that may arise when addressing the outsourcing of these jobs may also be a factor as other nations may object to the United States attempts to curb their acquisition of white-collar positions. These positions are also beneficial to the individuals in these nations especially countries that are barely developing past third-world status. The discussion would need to revolve around the benefits that are obtained by these countries at the loss of the United States economic security. The issue of outsourcing is a difficult one to discuss and the author does a good job of providing new insight into the topic. Solutions to the problem will not be developed overnight and providing focus to the issues is a service to individuals who are attempting to find work in this difficult economy.
Hill, C. W., & Jain, A. K. (2007). International business: Competing in the global marketplace (Vol. 6). New York, NY: McGraw-Hill/Irwin