The World Is Flat
There is a book with the same title as this entry. It explains how work can be done anywhere, and how US companies in particular have taken advantage of that fact. Outsourcing has replaced relocating in many cases. Outsourcing is the practice of contracting work to another firm who specializes in just that work. Relocating is the practice of shutting down plants and offices to rebuild them elsewhere, usually where labor costs are cheaper.
When I was younger and living in the midwest, car companies were just starting to expand into the south, and foreign competitors were building plants in the US as well. Older inefficient operations were replaced with more sophisticated equipment, and staffed with willing workers at a lower cost than the Detroit standards.
Lower cost has also pushed many repetitive tasks such as basic accounting and service desk work to areas with lower wages. The world is now flat. Information flows electronically around the world in seconds. Some work can be transferred literally anywhere in the world. As more work heads out of the US, to Mumbai, India for example, then the competition for labor there increases. Some of the outsourcing companies are finding that they must hire and train new people on a continuous basis. The cost advantage is going away.
If we had any sense at all, we would understand that this current cost advantage may slowly erode, and the opportunity to fix the issues at home, with our own workforce, will be gone. I hope to see the trend shift over the next 10 years, and that we bring some of that work back to the US workforce.
What do you think? Can we bring the work back, or is it gone forever?