Introduction Look at the clothing tag on your shirt. Where was it made? Most likely, the shirt was manufactured outside of the United States. This can be explained by two words. Global outsourcing. Global outsourcing has been a hot topic concerning many Americans since the early 1990’s. Businesses are always deciding whether or not to take on this great challenge. This trend can be seen in the textile and apparel industry, companies have moved mass amounts of production overseas. Although it seems all companies in the textile and apparel industry are transferring their production to other countries, it is not essential for a business to outsource in order to be competitive. Throughout the history of outsourcing, arguments both for
…show more content…
When China was opened to the West in 1979 and when the Berlin Wall fell in 1989, the mightiest political barriers to trade came toppling down. Yet, in the textile and apparel industry, many companies saw the strong dollar and a strong United States manufacturing system, so in turn they failed to keep up with new consumer demand and with competition. This allowed European and Japanese manufacturers to ability to obtain large shares of the textile market. In addition, as time went on global outsourcing became more appealing with the rapid growth of the Internet, low costs for telecommunications services, and an increased availability of highly educated workers in developing countries. These conditions gave companies the ability to conduct business virtually anywhere faster and easier. One last event that made global outsourcing accelerate was the dot com crash of the 21st century. This event made companies look for less expensive venues of development. Unfortunately, this meant moving production overseas.
Effects of Outsourcing
With job after job moving overseas, the media is littered with arguments for and against global outsourcing. In a study conducted by MIT professor Suzanne Berger, by mid 2004, about 1000 stories a month could be found in the print media concerning global outsourcing. There were such titles as “Is Your Job Next?” (Business Week, February 3, 2003)