The competition is increased globally since companies look for the best suppliers offering high quality at low prices, search for international human talents and acquire the best possible know how in order to satisfy better their customers' needs.
As a result of the above mentioned the cooperation of countries is expanded. The countries understood that may gain reciprocal advantages, they can react to problems better when they work together with other countries rather than trying to solve the problems alone. Lastly, the countries with globalization main deal with issues e.g. environmental issues that are not in their territory.
2. After summarizing the positive and negative aspects of offshoring, state whether you support or are against offshoring and why. Include any experiences you or someone you know has had in which offshoring is affected.
"improvements in technology will have as a result the need for fewer employees to accomplish the same task/work, particularly for the less skilled jobs that are easiest to offshore". (Hackos, 2004). The technology improvements will help companies to reduce their costs and thus reduce prices or invest the saved money in Research and Development. As a result, companies will grow and therefore will raise their employment rate and at the same time, they will increase highly paid positions in their countries.
Another positive aspect of offshoring is that the poverty level in poor countries has been decreased. This allowed them to decrease their unemployment rate and consequently people have more income to dispose thus imports from rich countries have been increased i.e. the decrease of poverty level in poor countries is beneficial both for the poor and the rich countries.
The negative aspects are the following: the product prices are not reduced although the production costs are diminished. Jobs are replaced and working conditions are deteriorated. Jobs in poor countries are low paid. When a country asks for more then the Multinational Companies move to somewhere else, somewhere cheaper.
Countries that have benefited from offshoring are China and India whereas the rest of the other under developed countries remain in poverty. According to Joseph Stiglitz, during the last yeast of the last century, the number of people living in poverty conditions has increased by 100 million.(Daniels, Radebaugh & Sullivan, 2007)
A personal experience that I have is from a person I know in Greece. He had been working for the local cotton industry which was blooming in the country fifteen years ago producing excellent cotton. Due to offshoring, the local cotton