tsourcing side of the debate- mostly made of corporate firms- relies on cost cutting and comparative advantage theories, alongside their fiduciary duty to shareholders. On the other hand, wide sections of the society argue against outsourcing in terms of the impacts it has on aspects such as unemployment, while sections of economists question the long term sustainability of outsourcing. This study investigates the issue of outsourcing through a review of the literature available, focusing on analysis of the research findings on outsourcing by firms in the USA. The study holds a strong position that outsourcing can be managed to reap its advantages and limit its disadvantages, with the USA benefiting from it.
According to Ellram, Tate and Billington (148-163), offshore outsourcing is the act of contracting low-cost options outside the country of origin to execute an organization’s internal business processes. Offshore outsourcing is increasingly becoming an attractive way to cut labor costs on services that are dependent on highly skilled labor for efficiency. Traditionally, the outsourcing location offers highly competitive and well educated manpower and holds a cost advantage over the home country. Firms, therefore, would prefer to outsource their internal processes to such destinations primarily for the purpose of cutting costs. Dossani and Kenny (772-791) argue that outsourcing is the next wave of globalization as driven by economic considerations. Couto, Mani, Lewin and Peters (1) trace the evolution of offshoring, noting that it has developed from; simple shifting of manufacturing processes to low labor destinations in the 1970s; moving jobs to low cost destinations as spearheaded by IT; currently, the phenomenon has shifted from just moving jobs to sourcing of talents from the global field. The latest trend has seen the outsourcing of white collar jobs in fields such HR, procurement, product design, engineering and legal services among others. Couto, Mani,