Mike Ladge

Currently, many jobs are outsourced, including finance and accounting
functions. Job outsourcing allows two scenarios to reduce costs or increase
knowledge. Both scenarios increase the company's profits in the long run.
Outsourcing to reduce the minimum wage will effectively increase profits and
reduce costs because labor costs are significantly lower. The current maximum
daily wage in Mexico is 67.29 Mexican pesos, which is about $5.18 per day
(Mason). When compared to the 8-hour minimum wage, that's $58 per day,
which is roughly 11 times the Mexican rate. Paying workers in this country

doesn't make any economic sense unless it's an experienced job.
Mike Ladge

Another reason to outsource is work experience. It is in the best interest
of the company to find the best trained and qualified employees so that tasks

and assignments are completed as accurately and quickly as possible. “In
summary, it can be argued that globalization increases income inequality and
exacerbates the income risk of low-skilled people” (Keuschnigg, C., & Ribi, E).
In the long run, it's cheaper to pay someone more dollars per hour who knows

what they're doing and has more experience than someone who earns
minimum wage who may be slower and have to revise projects and waste
time. what makes the company spend more money. Typically, these educated
workers are located in states where certain jobs are concentrated, such as

digging in certain US states such as Nevada and California.

Another reason for outsourcing is the benefit of having
taxes in different countries. The United States is
unfortunate because it has one of the highest tax rates in
the world. This means US income taxes are taxed more
heavily than in India. The current corporate tax rate for
2014 is 40% in the US, while the current rate in India is
around 34% (KPMG). This leads to the conclusion that a
difference of 6% is enough to push the sales window to
outsourcing. There will also be tax breaks for outsourcing
US companies, as they can use foreign tax credits and
thereby reduce their tax liability in the US. Reducing tax
debt helps companies maintain the same income and pay
less taxes rather than making less money and paying less
taxes.

Mike Ladge