Several bills have been lobbied in the legislature concerning outsourcing and offshoring but none have been signed into law. There are many speculations about what could happen to the US economy if outsourcing is banned or limited. While it could create more jobs in the US, many companies wouldn’t be able to afford the labor costs without raising the price of their product. Since the recent recession, more reputable companies have taken the production of their product overseas. Burton Snowboards is a company based out of Burlington Vermont and has been known for staying local and providing over a hundred jobs just in manufacturing. Since the recession, they have had to outsource most of their production to Austria in order to stay in business.
The economy has begun to recover in the past few months, and President Obama has revisited the topic. Last September he said that he wants to end tax cuts for companies that outsource jobs and instead give generous tax breaks to companies that create jobs in the US. The question still remains to be how the government and companies will be able to afford to create these jobs in America. There are roughly 350,000 people making shoes for Nike in Asia, each earning an average of $2.50 per day to produce an average of 4.3 pairs of shoes. Therefore Nike spends about $262.5 million in labor alone every year while they make $45.15 billion [average of $100 per pair of shoes], so they only spend 0.5% of their revenue on labor to make shoes [Glenn,]. On the contrary, American Apparel is a company with significantly fewer employees than Nike spends more than them on labor to provide a livable wage for all of their employees [What Does AA Do for Its Workers]. The generous wages come at a toll from the customers, while one can buy a plain white t-shirt from Hanes for $6, the same shirt at American Apparel costs three times as much, a price that not all Americans can afford. For that reason it would not be wise to ban outsourcing completely.
Much effort and time went into creating laws after the Industrial Revolution to create a safe and fair working environment. Now it seems as though all of that work is irrelevent now that companies have the option to outsource and many receive tax breaks for doing so. While it’s not the business of the US government how other countries mandate their own labor laws, companies are using it to their advantage so they can make a bigger profit. In a world where business plays a huge role in everyday life, it’s difficult to know if outsourcing is a moral practice or not, but it’s even more interesting to think about where the US would be if Labor Laws weren’t created after the Industrial Revolution.