Rising Unemployment Forcing US To Make Outsourcing Costly

In order to save his country from the aftereffects of recession, US President Barack Obama has promised not to give tax benefits to companies that outsource jobs. The worst to be affected by this announcement are IT and BPO companies. They have both overcome the effects of depression only recently. Their total business is to the tune of $71.7 billion, with the United States contributing to half of the same.

Gross Domestic Product
The contribution of the IT field to the country's Gross Domestic Product (GDP) for the year 2008-09 was 5.8 percent. By the end of this year, i.e. 2009-10, India will have control over 10 percent of the world's BPO business. It must also be taken into account that although the worst phase of recession is over, the United States is still suffering from its adverse effects. Every 10th person is unemployed there. Almost seven million people have become unemployed due to recession in the last two years. Many companies have also closed down. The United States will still take a few more years to overcome this crisis.

New Employment Law
It is apprehended that 3.3 million jobs will be outsourced by the United States by 2015 if Obama does not formulate a new employment law. It is a bitter reality that the United States occupies the number one position today thanks to Indians and Chinese. Yet, it is facing a severe challenge from these countries. As a result, it is afraid of losing its top position.
China is growing at a fast rate. If it maintains this speed, it will become the world's most powerful economy by 2020. The United States owes its number one position to the skill, intelligence, and labor of Indians and Chinese. Taking advantage of these talents, US companies get better quality works done at lower costs by these companies to keep their cost of production low. Their gain, however, deprives the country of job opportunities.

The Benefit
This is also inevitable since low cost of production cannot ensure increased job opportunities. Drawing attention of students of his country to the formula of India and China in this connection, the US President advised them to concentrate more on science and mathematics.
Science is the key to progress. The secret to successful development is to combine it with hard labor.