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Over the past few years, a lot of U.S. companies have decided to outsource their businesses to overseas locations. Some of these foreign countries are enticing American companies with tax incentives. Foreign workers are willing to work for less money than American workers without benefits. Many companies are saying that they are able to save more money and cut costs by moving overseas. All of the above statements are very important for a company trying to maintain a budget and create a profit margin. If they had stayed in the United States, those same businesses would be paying for benefits, yearly salary increases, and retirement contributions thus reducing their profit margin.
On the other hand, a sad factor behind the overseas movement of outsourcing to another country is that people are losing their jobs in America. Unemployment has reached the highest levels it has been for many years. And when people do not have a job, they cannot purchase new products and services creating an economic downswing in economic growth for America. It severely affects our economy.
One way of solving this problem is to create new legislation that addresses this problem. For example: Companies that move across seas should be taxed at a higher rate than those companies who are willing to keep jobs in our country. I realize that corporations already receive tax incentives in the United States, but businesses are complaining that they are taxed at a higher rate than other countries. Our government has to do some re-evaluation of the tax code in our country.
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