Essay by billyg April 2005

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Alcoa to Outsource 130 Pittsburgh Jobs to India

I. Summary:

Alcoa plans to eliminate about 130 jobs locally over the next year or so, as the aluminum producer moves data processing jobs to India in order to reduce costs. The company said 70 to 80 contractors and salaried employees at its North American Data Center in Upper Burrell, Westmoreland County, would be affected as well as about 40 salaried employees and 15 contractors who process accounts payable and receivable at the company's Business Services Center on the North Shore. The jobs will be eliminated over the next 12 to 18 months because they can be performed more efficiently outside of Pittsburgh, Alcoa said.

When completed, the outsourcing will reduce Alcoa's regional work force by approximately 6 percent. The company employs about 900 at its North Shore office buildings and about 575 at its data and research centers in Upper Burrell, as well as 300 contract workers at the Pittsburgh offices and another 300 in Upper Burrell. Employees were informed of the decision last week in an e-mailed note from Rudolph Huber, vice president of Global Business Services and chief information officer, and Russell Porter Jr., who manages the affected functions in the region. It was made after Alcoa completed a study of outsourcing, the practice of moving computer-related jobs overseas where labor is cheaper.

II. Evaluation or Response:

Macroeconomics is the study of the economy as a whole, which includes inflation, unemployment, business cycles, and growth (Colander, chp. 1 pg14). In today's society, Americans rely on having the option to have multiple service providers for their home or office. Several businesses especially those who work nationally or internationally with other businesses, try to find the inexpensive and new innovative ways to reduce cost. I have worked for...