NOT EXAGGERATED. AT WORST, JUST PREMATURE.

The bulk of outsourced jobs never leave U.S. shores, the government said on Thursday in a new report suggesting concerns over American workers losing jobs to cheaper foreign labor may be exaggerated.

--Reuters/Fox News, 6/10/04


A report by an influential consulting firm is exhorting U.S. companies to speed up "offshoring" operations to China and India, including high-powered functions such as research and development.

In blunt terms, the report by the Boston Consulting Group warns American firms that they risk extinction if they hesitate in shifting facilities to countries with low costs....

"Successful companies ask themselves, 'What must I keep at home?' rather than 'What can I shift to LCC's [low-cost countries]?'" states the report. "Their question is not 'Why outsource to LCC's?' but 'Why not?' " ...

Particularly troubling is the report's information about confidential discussions with executives at Boston Consulting's client companies, many of whom conveyed low opinions of their American employees compared with labor available abroad. Not only are factory workers in low-cost countries much cheaper -- well below $1 per hour in China, compared with $15 to $30 per hour in the United States and Europe -- but they quickly achieve quality levels that are "equivalent to or even higher than . . . [the] best plants in the West," according to the report....

Indeed, the report undercuts the view that R&D jobs in Western countries will increase even as low-skill jobs migrate to nations like China and India....

--Washington Post today