Effect of Globalization- transfer of manufacturing and high-tech jobs to underdeveloped countries Christian O’Connor Michael Erhardt Adam Spieker Tom Tracy RJ Rampersad

Globalization Globalization is about what is happening to economics on the world scale Developed countries vs. developing countries Developed countries posses modern industry & technology Developing countries have much lower incomes & large groups of impoverished people.

The Effect of Globalization on Developed Countries Too early to see all effects. Will help struggling American Companies Good for economy but may be bad for labor force

Effect on Developed Countries’ Workers American job losses Laid off workers returning to college Engineers turning to Research and Development Lower incomes

Globalization in Underdeveloped Countries Help countries advance. Countries include: India Costa Rica Influx of foreign money helps economy Local engineers can work in home country

Why companies do it… They can hire workers with the same knowledge and education for far less. They get out of many taxes and regulations. They can often dump waste almost anywhere making it cheaper and easier. All this saves money!

Education & Qualification The reason most jobs go to overseas people is because they simply are better qualified in the areas that are growing rapidly. What the companies are doing isn’t wrong, they just found people that are willing to work for less and are better qualified then most Americans.

Types of jobs affected by Globalization. Computer software development. Accounting jobs. Investment banking research.

Worker’s conditions The absence of regulations and laws in some countries could create unsafe workplaces. No minimum wages for workers No worker’s unions to force decent salaries and safe working conditions. Sweatshops are often used in production factories.

Supporters of Globalization Believe a better life for both the developing countries and the developed economies will result. Improved relationships between countries. The economic trends of globalization are inevitable.

Opposition to Globalization Hi-tech jobs are lost leaving a growing number of highly educated workers unemployed. Makes developed countries like the United States dependent on developing countries for basic parts, supplies, technologies & resources.

Effect on consumers Products could be cheaper due to the saved money by the company. The quality of products might not be as high. Supply and price could be controlled by foreign countries or companies like OPEC does now.

Salary Differences Technical workers from less developed countries earn much less than technical workers from developed countries. Cost of living is less in developing countries so they are content working for less. This encourages U.S. companies to outsource jobs to developing countries.

National Security Top secret information is sent or evaluated in developing countries. This could help developing countries to break off from big companies and grow economically. U.S. companies will need to have factories in different countries to do each part of the process to lessen the chance of this happening.

Future Outlook Globalization is going to keep expanding. Estimated by 2015, 3.3 million “white- collar” jobs will shift to developing countries.

Why will it increase? More & more people in developing countries are being educated for high-tech jobs. –Example: 200,000 engineering graduates in China every year. Due to the large number of graduates, salaries will remain low, and profits for companies will increase. Internet makes it even easier for companis to work effectively overseas.

What needs to be done? Policies that are aimed toward restricting U.S. companies from outsourcing rather then aimed to help unemployed tech workers in the U.S.