Outsourcing To Podunk: Keeping Jobs Within The Borders
While some argue that outsourcing is a waste of funds and that no amount of economic cost is worth the taxes which might be lost, many others think outsourcing is a necessity. Outsourcing allows you to keep your jobs in the country, keeping your economic needs fulfilled while still allowing you to maintain quality.
This blog will discuss outsourcing verses offshoring and offer insight on how things like H1B visas can maintain jobs within America's borders without sending them abroad.
Outsourcing involves sending work outside of the country, offshoring involves sending it within the country.
The Wall Street Journal may best define outsourcing as the transfer of work to an outside firm for a fee. Outsourcing can be done for a number of reasons, such as when CEO's travel and take their companies with them to places like China and India. The CEO may want to save money on food and accommodations, but outsourcing is how they get too buy products which they sell at a great profit back home.
Eighty-five percent of Fortune 500 companies use outsourced services in some capacity, with Sony, Honda, Dell and Microsoft being all known for utilizing services such as H1B visas and offshore outsourcing.
H1B visas are issued by the US to bring skilled foreign labor into the country. This can be done legally if a company is willing to pay the extra $3-6,000 in yearly fees per employee. H1B's can only stay with the company who hired them for a total of 6 years, but those 6 years can be renewed if the worker wishes.
Hiring an H1B is also much simpler than trying to convince companies to come across the border and do business in your country. It takes at least two months and sometimes as many as five months to get a foreign worker set up and producing work which is worth outsourcing, whereas H1B's are often ready to go after just three weeks of training.
H1B's also do not require the need for complicated paperwork, but are instead allowed to work anywhere in the country and can apply to live anywhere they please. This increases the chances of the employee being set up in a family-friendly neighborhood and comfortable enough to be able to settle into a new city.
An H1B can also be highly qualified. "The average salary four years after working on an H-1B visa is $75,000 annually, and graduates from top-tier US universities make closer to $130,000 one year out of college. That compares to the national average of $49,500 in earnings for all US citizens," said a Huffington Post article.
The job which would be sent abroad could also be done domestically. If this is the case, then it is important that the employee being trained is qualified to perform the same duties. While it may cost more to hire an American worker and send them overseas, these workers can offer a higher level of customer service and better understanding of your country's culture.
This also allows you to avoid many legalities which surround foreign workers and contracts such as those involved with H1B visas.
Offshoring allows companies to make things more cheaply but does not always allow them to make money.
The same source previously used to define outsourcing also defines offshoring as the movement of business functions outside the U.S. that can be performed more cheaply abroad. This can include things like server hosting, software development and even accounting services.
Offshoring may be a better option than outsourcing if you don't have an extensive or complex network of support staff to maintain while keeping jobs in the country. A small business which outsources might find it harder to keep track of their workers, as well as harder to find workers with adequate skill level when a freelancer is needed for something only he or she can do.
However, offshoring does have its downsides as well. For instance, what about when you need a stocked supply of new parts for an online store or something like that? It would be much easier to get that sourced in your country and delivered to your city. Consumers may also find it much more difficult to understand how something is made and the logistics behind it.
There are also regulations involved with offshoring, since most of these companies are already doing business in other countries within the world. This can include anything from drug trafficking and terrorism, which makes it possible for American companies who may be trying to set up a great life by coming over here, if you know what I mean.
There are several ways in which both of these services will benefit your company as well as yourself personally...
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H1B vs. H1C: Understanding the Competitive Advantage of Outsourcing for Your US Business
In order to understand why the American job market is being hammered right now, we need to understand what is happening with the H1B visa. The purpose of an H1B visa is to allow qualified individuals to work in the United States. This allows them to have jobs which offer higher salaries and benefits than if they were hired domestically. In addition, it allows them to work legally in another country, which can ensure that they are actually happy with their job and safe from any legal issues which may arise. The first H1B visa was created in 1990 for individuals with exceptional skills in fields such as architecture, medicine, law and mathematics. A second H1B visa was created in 1991 for individuals with specialized skills which are not normally included under the first category. There is no limit to the number of times one individual can receive an H1B visa within a two-year period. The president has the ability to limit the number of times that one individual receives an H1B visa based on the level of demand for these visas by U.S.-based companies. The president can also set aside certain positions within these companies to ensure that they don't need more foreign-born workers than they can currently afford or handle. Although it is possible to receive another H1B visa within the two-year period following the initial one, this is only possible if the individual has already acquired more than three years of experience in a specific job. Factors That Influence Oftentimes, companies will simply outsource their accounting and legal services to other countries. This can save them time and money as well as ensure that their papers are not tampered with or used for any illegal activities. These other countries will often be able to provide these services more cheaply than an American company can, which allows the company to save money while bringing in qualified individuals from other countries. When the economy is booming, it can be difficult to find workers who can perform your job. In this case, it may be easier to outsource than to hire locally. For instance, if you need a freelancer for something which can only be performed by them, it might make more sense to pay for their services instead of hiring someone within your company who is already overburdened with work. However, outsourcing may not always be the best option for everyone.
Conclusion
If you are planning a move, and working to assess the global marketplace of companies in your field, it is important to look at the possibility of offshoring, as well as the potential benefits which are available. Doing so can allow you to save money while increasing quality and efficiency in your company on a global scale.
It is crucial that you not only assess whether or not offshoring will be beneficial to your company, but also make sure that you thoroughly understand all of the potential risks involved with this particular type of outsourcing. If you do plan on doing this, make sure that you do it with care and understanding so that it does not go against state laws because of any illegal activities which may take place behind the scenes.