57 Million U.S. jobs are offshorable

By SiliconIndia   |   Wednesday, 03 December 2008, 11:46 Hrs   |    3 Comments
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57 Million U.S. jobs are offshorable
New York: Between 21 and 42 percent (28.4 to 57.2 million) of all U.S. jobs are potentially offshorable. Moreover, they are high-paying, high-skilled jobs such as financial analyst and microbiologist.

This was transpired when HBS professors Richard H.K. Vietor, Rawi E. Abdelal, and Jan W. Rivkin created a classroom exercise that asked HBS students to assess the potential 'offshorability' of more than 800 occupations in the U.S.

Rivkin and former research associate Troy Smith reported the students' results in a working paper, "A Replication Study of Alan Blinder's: How Many U.S. Jobs Might Be Offshorable?" In the study of Princeton economist Alan Blinder, it was mentioned that between 22 and 29 percent (25.2 to 31.8 million) of all U.S. jobs are potentially offshorable.

The students read an overview case, 'The Offshoring of America,' as well as 'Monitor's Opportunities in India,' as back ground material. "Monitor's case raises an uncomfortable question: Why should Monitor pay a Harvard MBA top dollar to conduct business research in the U.S. while an Indian Institute of Management graduate could do the work just as effectively in Delhi for much lower pay?," asks Rivkin.

Nearly 900 members of the MBA Class of 2009 participated in the exercise, with students divided into learning teams of five or six individuals. The exercise and discussion also raised the unsettling possibility that offshoring could come to an end just as quickly as it began.

Citing India's economic liberalization efforts of the early 1990s and the Chinese government's relatively recent decision to open its economy, Rivkin says, "The offshoring of activities is predicated on a huge number of non-obvious, sensitive policy choices. Many of our students have lived only in a world of increasing globalization. It's easy to conclude that the world will continue to become more and more integrated, but globalization is not necessarily a one-way street."

Source: Harvard Business School Working Knowledge

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