PODCAST - What is the “real” cost of Offshoring?

Posted by Jim Stroud

June 8, 2007

VERY, VERY interesting viewpoint… I am (and have always been) a proponent of globalisation. I really like the idea of business without boundaries. I have always heard arguments on how offshoring hurt America, but no one has ever convinced me that it was a credible threat. The following article and podcast, gave me a reason to pause and… think. Let me know your thoughts?

Whenever critics of globalization complain about the loss of American jobs to low-cost countries such as China and India, supporters point to the powerful performance of the U.S. economy. And with good reason. Despite the latest slow quarter, official statistics show that America’s economic output has grown at a solid 3.3% annual rate since 2003, a period when imports from low-cost countries have soared. Similarly, domestic manufacturing output has expanded at a decent pace. On the face of it, offshoring doesn’t seem to be having much of an effect at all.

But new evidence suggests that shifting production overseas has inflicted worse damage on the U.S. economy than the numbers show. BusinessWeek has learned of a gaping flaw in the way statistics treat offshoring, with serious economic and political implications. Top government statisticians now acknowledge that the problem exists, and say it could prove to be significant.

Click here to read thearticle: The Real Cost of Outsourcing. Or better yet, check out the podcast below from BUSINESS WEEK.