Labor is a major component cost of any product or service. The lower the labor costs, either the wider the margin or the cheaper the price of the product or service. Cheap labor can be had by either opening our borders to immigrants who are willing to work for less, or by outsourcing. I contend that outsourcing is the best option because of the hidden costs of immigration. Cheap laborers derived from open immigration often show up in our hospital emergency rooms with little or no ability to pay for services, which in turn increases healthcare costs for those of us who can pay.
Furthermore, legal immigrants are subject to our higher minimum wage. Also, these workers will require additional tax dollars to pay for their incarcerations if they break our laws, and to pay for the education of their kids. Low-wage legal immigrants are allowed to vote and would likely vote in favor of more social giveaway programs designed to assist low-income households.
When we offshore work and these countries dump their cheap labor onto the market, we incur none of the hidden costs while we still capture the labor cost savings in the form of increased investment dollars for the company and in lower sales prices for the consumer. Furthermore, we outsource congestion and pollution. America benefited from immigration during the agrarian age, when labor-oriented jobs ruled the day. During the industrial revolution, America benefited from skilled labor to work in factories.
Today’s information age requires more thought-oriented and educated workers, not just people willing to work hard. In my assessment immigration had its day in building America, but today business should embracing offshore labor vs. more immigration in order to preserve our way of life.
Would your business and the nation as a whole benefit more from more labor-oriented low-paying jobs, or from off-shoring that work to other countries?
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