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BUSINESS OFFSHORING IMPLICATIONS ON THE LABOUR MARKET

Keywords: outsourcing , offshoring , labor market , competition , education

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Abstract:

In terms of economic policy, three new aspects are important in the current context of globalization which brings forward new strategies regarding the outsourcing and offshoring of activities and functions of the value chain. These aspects refer to the instant appearance of an offshore transferable function , to the unpredictability of winning and losing functions and to the lowering of competition from the levels of sector, company or professional qualification category to an individual level.. Of the three features, the most problematic for policy makers is the unpredictability of the impact of globalization. For example, in Europe we can not reasonably believe that workers in the most competitive sectors will be in a position of winners, nor that these winners will be the most prepared or trained in analytical functions. Many European workers currently work at prices fixed by the local market and not covered by productivity. But when the competition on functions will expand through globalization outside the country or area, their choices will be either a job loss or a reduction in salary. The question that will be raised ever insistently will be the following: what jobs are more exposed to this new competition? On the one hand, offshoring is on balance positive for Western economies, because it makes domestic companies more competitive. At the same time the material outsourcing is, for most developed economies, much more important than the outsourcing of services and the implications for labor market must be objectively differentiated in the two sectors. On the other hand, if we take into account the amplification of the effects that offshoring already has on the structure and distribution of labor, the socio-economic European policy of labor orientation to the coordinates of a "knowledge based" economy and to the jobs of the "information society" could be wrong.

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