Outsourcing Statistics

Conventional, pre-modern era business models concentrated upon exchange of material export and import of goods as a means of generating national income and positive foreign exchange. In the modern era, enhanced communications, have paved the way for export of services as a means of import and export. Outsourcing, offshore development and foreign production are some excellent examples of this phenomenon. Outsourcing work to cheaper workforce, has become a trend that has been observed in the latter half of the 20th century. Interestingly enough, the outsourcing practices have played a significant role in economic occurrences such as inflation in agrarian and developing economies, and economic recession in some important western economies.

What is Outsourcing

The concept of outsourcing is simple to understand. Projects and works that are dematerialized in nature such as receiving distress calls from consumers are handed over to economies that have low-priced labor market. Outsourcing has its pros and cons on both economies. Though, the statistics on offshore outsourcing paint a positive picture, it does have some unwanted effects on society itself.

Statistics About Outsourcing

Outsourcing has always been associated with the field of industrial technology as almost, 30% of the outsourced jobs belong to the IT sector. A large positive impact of outsourcing IT sector project jobs to Asian economies is that it has contributed immensely to development of these countries. In addition to that, it has also contributed to some effective development in the field of computer sciences. A phenomenal workload of 4 million jobs has been transferred to economies of China, India and Philippines.

On an average global outsourced projects involve about 28% that belong to the hardcore IT sector, 11% to finance sector, 15% to sales and marketing and 9% from administrative sector. The remaining 22% belong to many other different sectors such as consumer distress calls, general data segregation jobs, tourism etc. As of 2006, the outsourcing activities accounted for jobs worth $1.2 trillion per annum. Some economists have predicted that by 2015, more than 3.3 million U.S. jobs and $136 billion worth of wages, will be transferred to developing Asian and African economies, due to cheaper labor markets.

According to many researchers and surveyors, to some extent, outsourcing of jobs or services from the U.S. are a cause of economic recession. US outsourcing statistics also rightfully depict that an increased rate of outsourcing was largely responsible for a prolonged recession, as the US economy could not provide appropriate number of alternative jobs against layoffs. This phenomenon has been also nicknamed as over-outsourcing.

On the whole, as we look at outsourcing, we can easily tell that outsourcing is not exactly a totally good or bad phenomenon. The governmental finance and labor departments should be able to curb and control the rate of outsourcing, in order to maintain a regional economic balance.