Why do companies outsource jobs to places like China and India?

If American companies had absolute power would they force Americans to work for wages like in China and India?

Reasons are as follows

1. Cheap Labour
2. Quality work
3. Work is happening round the clock (24 hrs)
4. Customers can be supported round the clock (24 hrs)
5. Engish Speaking population (Incase of India)
6. Exposure to advanced technologies
7. Global Business Setup
8. Helps to understand the unknown part of the world by
language, culture, political setup, etc...

Its cheaper and upper management can make more money...

I suspect 30 cents/hour workers and absolute freedom to pollute might play a role in their decisions.

It's to cut company costs, because paying a Chinese or Indian telemarketer is a lot cheaper than paying a demanding American ;-)

it is much cheaper and because of loop wholes in our tax codes corporations actually get tax breaks for outsourcing

because Loyalty isn't a component of Capitalism...

it is cheaper and even Bush supports it. Talk about being UnAmerican!

There's a couple of reasons, but the most obvious one is reduced costs. Wages for skilled workers (at all levels) are lower in developing countries such as China and India, as is the general cost of doing business.

Interestingly outsourcing has led to an increase in wages in some sectors in India and China, leading to some companies, including those in India and China themselves, to outsource some tasks to even cheaper countries.

They can get away with low wages, no benefits, and high profits. This effects the white collar workers who buy expensive houses based on good paying jobs, and then find out their jobs have been outsourced, as well as blue collar workers who buy cars and houses that keep the trade occupation workers working, etc. down the economic line.
Often, as in the toxic paint scam, it's these countries which get blamed for making toys according to the American Corporation directives. The blame doesn't go to the profit American executives, but to the poor workers in China.

Easy to blame greedy corporations as well as the mentioned ability to pollute at will,, But just as guilt and even more guilty are the cheap American consumers that dont read labels or even care. I the chinese crap is one penny cheaper the American shopper will buy it. Wake up people, Poisoned dog food, antifreeze in toothpaste, lead based paint on toys, GHB filled microdots ? How much will it take for my fellow ignorant Americans to start refusing to purchase Chinese products ?

So they can pay their CEO more millions of unearned dollars. Corporate and wall street greed is killing the US.

They run the numbers on their spread sheets and make the decision based on their projections.

Often these projections are wrong and it is better to maintain operations in the United States.

Look at all the intellectual property theft that occurs in China!

Frankly, it is very bad management not greed. They do not consider all the cost of this re-engineering and employees and shareholders pay the price.

because they see only profit. they dont think about the long term repercussions of their actions. same with a company that just for example dumps toxic waste into a lake in their city, they dont care, its not hurting the CEO so they dont care. same for insurance companies who let children die because they refuse to give them a transplant, the CEO gets bigs bucks for the death of that child, it makes me sick. most large corporations have so much immunity to social or environmental problems because of their corporate status, they are an entity that in some aspects cannot be touched. they think for the here and now, how much money can i make now, even if it ruins the economy later, ill still be rich until i die. that is the state of affairs in our country.
joe4d has a point, as long as we put up with it they will continue to profit. for example i refuse to purchase goods from some companies for similar reasons that we are discussing, i spend more at small businesses, but i dont like to talk and do nothing about it, even small things can add up if people would get with the program. i wouldnt ask anyone else to do it, but thats what i do for my own peace of mind. i also dont purchase some goods if they were made in certain countries, people should check the labels more often and see where things are produced.

Lower wages and sadly in some cases better skills (especially at those low wages)

All the comments regarding the fact that is cheaper are correct. That makes the companies more competitive (If I don't use the sources my competitors will and I will be driven out of business).

Secondly it is the American consumer. Buy American is only followed if it is cheaper. Forget about quality.

Because it's cheaper for them to pay others in China and India peanuts for their work and they don't have to supply them with benefits. They have dollar signs in their eyes.

There are several reasons.

All are tied to labor cost.

1. Companies, simply want higher profits, so they move to a cheaper labor market.

2. Some companies have to move, they simply cannot compete against cheaper imports, paying an american wage scale.

Levi Straus Company is a good example of that.

Levis, had a union plant in texas, they actually paid above average wages for the textile industry.

Then they had to start competing against blue jeans made in central america.

For five years straight, levis lost money.

Since textiles are very labor intensive, thats where most of the cost are.

Levis just couldn't sell thier blue jeans cheap enough to compete against lower priced imported Blue jeans.

So Levis had a choice, they could go out of business, or move thier manufacturing plant to central america and pay cheaper labor cost.

Even thier union agreed, levis had no other choice.

So who do you blame for them moving ?

I blame the American consumer, who decided they would rather spend $3.00 less for a pair of Blue Jeans.

Many of the large companies that do International business have offices and plants all over the world. China and India are the fastest growing economies around. It makes sense to move some of the business to where your largest growth is coming from. You have favor with the local governments because you provide jobs for the economy that you are selling into and you reduce taxes and fees. You can address work related problems real time. Communication and time zone issues are eliminated.

Small businesses located in the U.S. trying to compete with inexpensive import products will either go out of business or they have to find a way to compete - outsource or offshore.

Examples are plenty. (Auto makers, electronics) Just read. Yes, execs probably get more pay than they deserve. But there is no conspiracy. The objective is for a business to make as much profit as it can. Not to provide a decent living for all of it employees. But, it is an advantage to a business to provide a reasonable salary to it's employees to keep them content so they get the best that each employee has to offer.

And Americans want their stuff cheap while at the same time complaining about quality jobs. Can't have it both ways.

so they dont have to pay union wages to get shoddy work. They outsource it for far less money and get better quailty.

it's cheaper to buy the merchandise from those countries while still paying the shipping fee than to have them produced in the US and pay the minimum wages for lazy American labor.

It isn't so that upper management can make more money, it's so stock holders can make more money. Stock holders are people like your mom and dad who are going to retire on those stocks. So while everyone says that it sucks, they are all still getting a benefit from it.