The New Wave of Outsourcing

Abstract:     
This paper assesses the potential impact of the ongoing phenomenon of services offshoring (frequently referred to as outsourcing, in the media) by analyzing the occupational structure of the US labor market. It develops a list of occupational attributes of offshoreability, points out the institutional characteristics, wage-differences and other features of the recipient economies, such as India, and compares and contrasts manufacturing and services offshoring. The paper suggests that 14 million jobs or 11% of the employed labor force is vulnerable and at-risk to offshoring. The authors also look at the potential impact of offshoring on real estate and on regional/metropolitan areas in the US, and speculate about future economic-adjustment scenarios.

Number of Pages in PDF File: 13

Keywords: outsourcing, offshoring, occupations, India, US, job loss

JEL Classification: J6, J3, F1, F2, R2

working papers series