One step back ... and two forward?

• Author: Challenger, John A.
• Position: Business & Finance - Outsourcing - Viewpoint essay

OFFSHORE outsourcing is one of the most controversial topics in business. It even is one of the hot button issues in politics--from presidential campaigns down to lowest levels of local government. Depending on whom you ask, increased outsourcing either is a great thing for our economy or it is extremely detrimental.

Companies that send jobs overseas will tell you that it is saving them money, which allows them to invest more money in expansion and new product development. This means more jobs and a better economy. Firms that do not outsource will tell you they are being undersold and undercut by those that do and are at risk of going out of business. This, of course, is bad news for the economy, which obviously does not need any more of that.

Then you have frustrated job seekers: many Hill tell you that outsourcing is a big reason they cannot find new jobs. I do not have to explain to you the effect that long-term unemployment had on the economy.

It is going to fall on business leaders, the nation's current and future workers, educators, consumers, and politicians to determine how to ensure that outsourcing ultimately strengthens our country's economy. Offshore outsourcing is not new. American companies have been outsourcing manufacturing processes for decades. The issue that has fueled the increase in rhetoric on the practice is the expansion of outsourcing into areas that most people never imagined going overseas--namely white collar, information-based positions. In retrospect, the low cost of establishing and maintaining Internet connectivity between the U.S. and Asia made this type of outsourcing inevitable. As prices dropped, more and more companies joined the ranks of offshore outsourcers.

It is not just large firms that have moved jobs overseas. Small companies, and start-ups in particular, have found that they too can take advantage of less expensive knowledge workers overseas--and it is not just information technology jobs that have moved overseas, as paralegals, X-ray technicians, accountants, health record technologists, medical transcribers, and architectural drafters have joined the parade. No wonder there is the feeling within the U.S. that jobs here are being destroyed permanently.

When we lose our job or see a colleague lose his or hers, it is easy to be overwhelmed and traumatized. The fear of permanent job loss keeps surfacing in new forms. In the 1980s and early 1990s, there were doubts about the country's ability to...