The Impact of Local Politics on Business Process Outsourcing

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In this article, we glance at a hot topic and a burning issue within the west i.e. the hue and cry over outsourcing and shipping jobs overseas especially at a time when the domestic workforce is finding it hard to induce gainful employment.

The basic issue at stake is that the concern of the trade unions and workers within the US and Europe at what they perceive is unfair shipping of jobs overseas once they are suffering. How the politicians can let business leaders ship jobs overseas when the domestic workforce is unemployed, the argument goes. This can be the so-called protectionist argument which states that outsourcing leaves the economy of the house country in an exceedingly bad shape. Countering this argument is that the pro globalizers who argue that outsourcing leads to cost savings and other benefits like target higher value-adding work.

The debate is actually framed as between people who want the roles to be kept within the US and Europe compared to those that see outsourcing as a necessary evolution for any economy to maneuver up the curve. The purpose here is that top-minded arguments just like the latter are hard to justify in recessionary times when the workers within the domestic sector are left without jobs and no hope of finding new ones.

 

ALSO READ: The Effects of Political Changes on Stock Prices

 

This issue which is usually within the headlines because of newspersons like Lou Dobbs resonates in an exceedingly presidential election year (like this year – 2012) when tempers run high and also the outcry over outsourcing grows. As are often seen from the recent happenings within the US, President Obama is pushing for lesser outsourcing in some sectors such as financial services and more outsourcing in other sectors. This twin-pronged strategy is to confirm that only those jobs that are deemed to be redundant within the US should be shipped overseas and that American competitiveness stays intact.

Contrast this position therewith of the opposite presidential hopefuls like Mitt Romney who favors a blanket style of outsourcing where the CEO’s and also the shareholders benefit but the normal worker suffers. In recent weeks, this has become the rallying postulate of the Obama campaign team and this can be an instantaneous result of the compulsions of domestic politics which have an outsized say in determining the extent of outsourcing that may be done. Finally, the outsourcing issue is additionally an awfully sensitive one as the livelihoods of workers are at stake and hence any politician or media commentator must treat the problem in a very delicate manner. The purpose here is that except for the posturing and rhetoric, an objective and a hard-nosed analysis of the problem should be done in order that partisan bickering and one-upmanship don’t derail the controversy.

In conclusion, it’s indeed the case that American CEOs and business leaders would find it increasingly hard to justify their pro outsourcing stance especially when the US economy is tanking and there are fewer jobs to travel by.

 

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