Outsorcing

Question 1

Define outsourcing.

Answer 1

Cost saving strategy used by companies who arrange for goods / services to be produced at locations with lower costs.

Question 2

What does it mean that outsourcing is one directional?

Answer 2

Manufacturing or service jobs from high wage economies to lower wage countries.

Question 3

Consequences of outsourcing for origin country?

Answer 3

Loss of jobs.
De industrialisation.
Structural employment.

Question 4

Loss of jobs.

Answer 4

Knock on effect in communities where large company has been outsourced.
Umeployment means less spending in local economy.
Loss of jobs / services.
Demultiper effect.

Question 5

De industrialisation.

Answer 5

Of economy.
This is due to outsourcing.
Closure of local suppliers.
Areas decline - derelict.

Question 6

Structural employment.

Answer 6

Skill set lost.
People no longer compatible as jobs have moved.
Make take generations for a new workforce with education / skills for local economy