Outsourcing creates a competitive environment, where different companies have to compete for business to get the contract from the first company. It, in turn, save the first company money by not having to invest into resources and merely concentrate on what it does the best. At the mean time, many other companies would be created to compete for the businesses that the second sets of companies don’t need to invest.

It basically cause a very competitive environment where the cost of labor would be cheaper, and companies can turn profit with cheaper costs.

That is the reason we are outsourcing our jobs to countries such as China, Mexico, and India.

Sadly, it may help with short term. In the long term, it will hurt the US economy, as the infrastructure deteriorates and jobless rate increases.