Foreign Labor, Is it good for the United States? On April 14, 2000, Nike founder Philip Knight cut off millions of dollars of personal donations to the University of Oregon. This sudden retraction was the result of the University's support of the Worker's Rights Consortium, a somewhat radical organization that doesn't try to cooperate with companies that use foreign labor. Instead, they are resistant to back proposals by companies to improve labor interests because their financial backing comes from American labor unions. These unions are understandably interested in promoting more jobs in America to strengthen families and improve the workplace.
This issue reveals a much deeper problem for American companies. Should they use foreign labor? This comes down to the question of what kind of labor they need. If they are using labor that requires high levels of educations and training, it makes sense to use workers in one of the most educated countries in the world.
The wages are high, but the productivity is also very high, which is a good investment from a business standpoint.
What about industrial and manual labor, which American labor unions are so adamantly committed to defend? From an economic standpoint, it does not make sense to hire Americans for these jobs. These jobs will inherently be low-paying positions because of the minimum skill level required. As an educated nation, a large number of people are overqualified for many of these jobs. With high minimum wages and benefits offered to employees, the cost of many of the industrial goods us as consumers purchase would skyrocket if all the industrial and manual labor requiring jobs were held by Americans. When the cost of labor increases, so does the price of the resultant product. These added costs will contribute to inflation, which will bankrupt a...