In recent years, General Electric (GE) has been making headlines for its aggressive outsourcing efforts, with many critics questioning the impact on job numbers in the United States. In this article, we will examine the evidence and provide a closer look at how GE’s outsourcing has affected employment levels in the country.

Job Losses and Replacement Workforce

One of the most significant concerns about GE’s outsourcing is that it may lead to job losses for American workers. While this is certainly a possibility, it’s important to note that outsourcing doesn’t always necessarily result in job loss. In some cases, companies outsource work to countries where labor costs are lower, allowing them to save money and potentially reinvest those savings back into their business.

For example, GE has been outsourcing manufacturing work to China and India in recent years, which has led to concerns about job losses in the United States. However, according to a report by the Center for American Progress, the impact of GE’s outsourcing on American jobs is more complex than it might seem at first glance. The report found that while some jobs have indeed been lost due to outsourcing, new jobs are also being created as a result of these efforts.

In particular, GE has been investing heavily in research and development (R&D) in the United States, which can lead to new job opportunities. For instance, the company has invested in a new R&D facility in upstate New York that is expected to create hundreds of jobs. Additionally, GE has been partnering with universities and other institutions to foster innovation and entrepreneurship, which could help to spur economic growth in the long run.

Outsourcing and Wage Suppression

Another concern about GE’s outsourcing is that it may suppress wages for American workers. Some critics argue that companies like GE are using outsourcing as a way to drive down labor costs, which can lead to lower wages for workers in the United States. However, there is some debate about whether this is actually happening in practice.

According to a report by the Economic Policy Institute, there is evidence that companies are engaging in “wage suppression” through outsourcing, particularly in industries like manufacturing and service jobs. The report found that workers at outsourced facilities tend to earn less than their counterparts at domestically owned companies, and that this can lead to a downward spiral of wage stagnation and economic inequality.

However, other studies have suggested that the impact of outsourcing on wages may be more nuanced than it appears. For example, a study by the National Bureau of Economic Research found that while some firms do engage in wage suppression through outsourcing, many others do not. In fact, the study found that firms tend to be more concerned with maintaining their own profitability than they are with suppressing wages in other countries.

Conclusion

In conclusion, GE’s outsourcing has certainly had an impact on job numbers and wage levels in the United States. While some jobs have been lost due to these efforts, new jobs are also being created as a result of investments in R&D and partnerships with universities and other institutions. Additionally, while there is evidence that companies like GE may engage in wage suppression through outsourcing, this is not always the case, and firms tend to be more concerned with their own profitability than they are with suppressing wages in other countries. Ultimately, it’s up to policymakers and businesses alike to find ways to balance the benefits of outsourcing with the need to protect American workers and promote economic growth.