International Outsourcing in the Information Technology Industry

Big corporations in the United States began to export centers of customer service, maintenance, manufacturing and production to countries with developing economies in order to escape the expensive operational cost by these companies. By exporting parts, or all, of their production and services to developing economies, businesses benefit from tax and cheap labor. It is estimated that large companies employing 100 employees in a developing country is equivalent to operating costs to 10 employees in the United States. The importance of outsourcing company highlighted a few years back when the United States declared a state of recession. Since then companies began outsourcing more software projects. This helps the company same money on development costs by paying less for the same services.
Outsourcing, although profitable, is highly controversial. By exporting parts or all of the Information Technology industry to developing countries, American jobs are lost, putting many out of work. The rise in outsourcing to developing countries is said to have been one factor in the cause of the recession. This industry has moral problems to deal with, however, since most IT companies are international, loosing American jobs is not necessarily an unethical decision.