The Effect of Outsourcing on Middle-Class American's

Essay by crabbxx1College, UndergraduateA, January 2009

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The Effect of Outsourcing on Middle-Class American'sThe American middle class is in danger of becoming defunct by the outsourcing of jobs to foreign countries. Jobs that Americans once considered stable long-term employment are now being outsourced at a rising rate. If this trend continues, America could be the next third world country. How has this happened? What can the average American do about it?Outsourcing is not a new concept. As early as the 1900's the US Government was outsourcing jobs to the private sector to help cut costs to tax payers. Over the years, this practice was found to boost the economy by creating new jobs and keeping the unemployment rates low. According to the Bureau of Labor Statistics, the unemployment rate in 1944 was only 1.4 percent. Business was growing strong and so was the economy. In the 1970's and early 1980's, with operating costs rising, business began looking to outsourcing to save millions of dollars.

Hundreds of thousands of jobs in the manufacturing sector were outsourced to third world countries. The unemployment rate, according to the Bureau of Labor Statistics, went from 3.5 percent in 1969 to as high as 9.7 percent by 1982 (2006, p. 1). Big business had solved their overhead cost problem by sacrificing the American worker. Blue-collar workers were left to fend for themselves either standing in the unemployment line or retraining for new jobs, all at their own expense.

Over the years, the blue-collar workers that had lost their jobs were retrained into white collar jobs in the service industry. The service industry, like the manufacturing industry of the past, was growing at an increasing rate as was the U.S. economy. As history repeated itself, this burgeoning industry finds with increased growth came the increased cost of operation. Businesses once more are using...