Barack Obama as President and Industry Consolidation.... Good for Outsourcing

From The Hindu Business Line an article by a University of Michigan Professor on how Consolidation is Good for Outsourcing.

The deeper reasoning behind this article is that there is a wage discrepancy caused by national borders but this is not represented by a skills discrepancy. Whether the current economic environment is in "cost cutting" mode or "growth mode." When the current environment is cost cutting, large and small enterprises will be looking for cost effective solutions to lessen the burden of labor and technology related expenses. Outsourcing is a great option. In a boom time or a time when top line growth is paramount people will still be looking to do more activities with new capital (doing more with more money). Outsourcing being a prime option. This speaks to realignment of wages that is structural and not cyclical. There is always a question of the quality of sourcing differently but generally the market works these issues out.

This fundamental reasoning sometimes gets lost in the shuffle. Experts will try and predict trends for certain sectors of outsourcing but the fundamental notion of technology "flattening the world" coupled with Purchasing Power Parity differences across borders not representing skill makes outsourcing a fundamental necessity for sustained growth and not a choice of value.