Student Question

Is offshoring always a lose-lose proposition for the US worker? 

Expert Answers

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While this question is somewhat controversial, most economists would argue that there are positive sides to offshoring for American workers as a group.  There may not be any positives about it for some individual workers, but workers in general can benefit in some ways.

Of course, offshoring is a source of harm for many workers.  Every time a job is offshored, an American worker loses that job.  There is little in the way of upside to losing one’s job. 

However, this is not the entire story.  As some kinds of jobs are offshored, a number of American workers are, in a sense, freed up to do other jobs.  It is important to note that these may not be the same workers who lost their jobs.  However, these offshored jobs are no longer demanding anyone from the general pool of American workers, meaning that other jobs can be created that will employ those workers.  In general, the jobs that go overseas are typically the less skilled jobs.  What this means is that Americans are freed from doing less skilled jobs and can now do more skilled jobs that are likely to pay better.  This may not happen until the next generation of workers arrives.  The person who has worked on an assembly line will surely have a hard time retraining to do a more knowledge-based job.  But the idea is that that person’s children can grow up and get better jobs instead of being needed to work on the assembly line.

Americans generally have access to good educational opportunities.  They can educate and train themselves to do high-value jobs.  Offshoring the low-value jobs will, in theory, allow more Americans to work in the better jobs.  For this reason, offshoring is not a lose-lose proposition.

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