Outsourcing is a requested practice in the modern economy because many companies want to deal with lower material and labor costs. The article by Linden et al. (2011) demonstrates that Apple Inc. also benefited from this phenomenon when it moved its iPod production facilities to China. I think that Apple’s decision to cooperate with Chinese manufacturers seems logical because the company needed to find an opportunity to reduce costs to get a competitive advantage.
One should also admit that Apple consumers witness specific benefits because of outsourcing. In particular, lower wages paid to Chinese workers allow the company to offer cheaper products, which is attractive for buyers. Since the business has found an opportunity to reduce production costs, it can provide its customers with more reasonable prices. That is why I believe that Apple’s arrangement with Chinese manufacturers is advantageous for clients.
Apple’s decision to outsource iPod production has negative and positive impacts on the United States. On the one hand, this issue results in a significant decrease in production jobs in the country, meaning that many individuals become unemployed (Linden et al., 2011). Thus, people without a college degree have lower opportunities to find a well-paid occupation. On the other hand, Apple still offers many valuable jobs that are not outsourced (Linden et al., 2011). Consequently, this state of affairs motivates US citizens to get college degrees to have more employment possibilities.
I think that Apple’s strategy is beneficial for Chinese workers. One should understand that salaries are lower compared to the US level, meaning that they are fair for China. The organization offers reasonable wages and attractive working conditions to be competitive in this Asian market. That is why there is no doubt that many low-skilled workers in China like the arrangement with Apple because it provides them with an opportunity to earn money.
Reference
Linden, G., Dedrick, J., & Kraemer, K. L. (2011). Innovation and job creation in a global economy: The case of Apple’s iPod. Journal of International Commerce and Economics, 3(1), 223-240.