This post contains affiliate links.
With all of the media coverage of million dollar bonuses paid to CEO’s and companies purchasing steel, textiles and other materials from overseas such as China and India instead of at home in the U.S. people are left wondering the big question which is “Are Companies Greedy?”.Â The answer unfortunately is not as simple as the question and in fact leads to several more questions.Â For people who think that every outsourced job is a lost job in the United States, or for every company that ships factories or warehouses to another country is destroying lives here at home, you have to stop and consider the following.
First and foremost public companies are accountable to stock holders and therefore are compelled and expected to deliver returns that make their investors happy, this capitalistic mentally means that companies are always looking to lower costs and increase revenue and profits.Â They make more profit by selling more product, if they can reduce the price of the materials to make the product and lower the price of the product, then they can be cost competitive and sell more product.
People want lower prices for everything unless you are spending specifically for luxury and have the financial means to do so.Â We want cheaper cars, gas prices, televisions, computers, camera’s and cell phones, we all know we want the best value for our buck and companies are constantly trying to lower costs to sell more product.Â The problem is that companies often have to purchase or ship labor overseas to reduce costs so they can sell a product cheaper and make more revenue to deliver higher returns for stockholders.
Would you rather earn 0% interest on your stock and pay $50 more for a cell phone just because the company is purchasing and hiring people only from the United States, you the reader might say yes that it is worth paying a little more to keep the work here in the U.S., however the stockholders will say no and pull their money from the company and invest in other more profitable companies.Â As long as people are looking for profit, companies will be looking to cut costs and purchasing the least expensive materials they can get.
I am not against offshoring, outsourcing or anything else because I believe even in a tough economy jobs can be found, different jobs that require retraining and specialization however.Â Much like a blogger has to find a niche market to gain popularity a worker has to find the job area’s that need skilled workers and retrain to perform that job function.Â As people we cannot afford to be inflexible in what we do for work, we need to adapt to the changing market and the changing times and develop different skill sets even if they buck the traditional.
This is a global world now people jobs created her means jobs not created elsewhere, jobs created there are not jobs created here.Â Americans are working overseas and overseas citizens are working for American companies, we are virtually one global economic community and we see this by one recession affecting the world not just the United States.