GLOBALIZATION, JOBS, and INCOME

The first major concern of globalization critics is that falling barriers to international
trade results in the loss of manufacturing jobs in advanced countries.

In recent years, firms have increasingly been outsourced to other nations where wage
rates are much lower. Specifically, corporations such as Dell, IBM, or Citigroup
outsource service operations to lower-cost foreign suppliers; indeed, these 3
corporations are "exporting jobs" to low-wage nations and contributing to higher
unemployment and lower living standards in their home nations. To minimize this
risk, some lawmakers in the United States have responded by calling for legal barriers
to job outsourcing.

The integration into the world economy, combined with the massive increase in the
global labor force due to the population growth, results in lowering wages in
developed countries. Take Harwood Industries as an example, a U.S. clothing
manufacturer closed its U.S. operations, where it paid workers $9 per hour, and
shifted manufacturing to Honduras, where textile workers receive only 48 cents per
hour. This proves that the wages of poorer Americans have decreased significantly,
and the wage disparity between developing and developed countries is closing as
developing nations experience rapid economic growth.

SLIDES

Slide 1:

GLOBALIZATION, JOBS, and INCOME

Falling barriers to international trade results in the loss of manufacturing jobs in
advanced countries.

Slide 2:

Firms have increasingly been outsourced to other nations where wage rates are much
lower.

Dell, IBM, or Citigroup outsource service operations to lower-cost foreign

suppliers

-> These 3 corporations are "exporting jobs" to low-wage nations

-> Contributing to higher unemployment and lower living standards in their
home nations.

Slide 3:
The integration into the world economy, combined with the massive increase in the
global labor force due to the population growth, results in lowering wages in
developed countries.

Slide 4:

Example: Harwood Industries, a U.S. clothing manufacturer closed its U.S. operations
and moved to Honduras.

+ In U.S: workers receive $9 per hour.

+ Honduras: workers receive only 48 cents per hour (~ $0.48 per hour)
=> The wages of poorer Americans have decreased significantly,

=> The wage disparity between developing and developed countries is closing as
developing nations experience rapid economic growth.