The concept of offshoring is known quite widely in the modern economic environment, yet very often frowned upon as a tool that may lead to significant financial complications. In the context of the U.S. economy, two main problems with offshoring appear to lie on the surface. The first one can be described as a drastic drop in job opportunities for local residents, and the second one is represented by a decline in the cost of real estate (Ronald Speights Class Assignments). The identified issues have a drastic impact on the U.S. economy, leading to further complications for organizations (Dick). However, offshoring also provides several benefits for American businesses, such as the opportunity to reduce expenses and the improvement in risk management.
To manage the disadvantages of offshoring and maximize its benefits, one should consider shaping the hiring policies so that local residents could also be hired in addition to the staff that the company offshores. Moreover, the issue with real estate can be improved by increasing costs for offshore locations. In turn, the benefits that offshoring provides can be maximized by exploring the specifics of tax policies in offshoring regions, as well as local markets (Ronald Speights Class Assignments). Thus, an organization can select the conditions that suit its objectives and allow it to use its resources in accordance with their potential. With the right choice of an offshoring company and the willingness to meet the existing regulations, an organization will be able to use the opportunities mentioned above in order to improve its performance without affecting the economy of its state (Ronald Speights Class Assignments). Moreover, once the concept of offshoring is used not as an attempt to bypass the existing laws but as the means of advancing the organization and the state economy, it will produce positive effects both on the firm’s profit margins and the state’s GDP.
Works Cited
Dick, Daniel. “Offshoring Benefits.” YouTube, uploaded by Daniel Dick, 2009.
Ronald Speights Class Assignments. “Offshoring of American Jobs.” YouTube, uploaded by Ronald Speights Class Assignments, 2018.