Case Study - Outsourcing To China Flashcards
Global outsourcing to china
Global shift of manufacturing caused extreme poverty in china to fall from 60% to 16% by 2005
Gained the reputation of “workshop of the world” due to a massive pool of low cost migrant labour
Between 2000/2010, conditions improved for workers and wages increased to $1500 a month
Products such as iPhones are made in china, not just “throw away” cheap goods
Costs of outsourcing to china
Many workers were exploited in sweatshops.
Around 2500 metal workers lost a limb or finger each year due to dangerous factory conditions. (Gained a reputation)
Environment suffers greatly (air pollution) which causes cancer and strokes
Benefits of outsourcing to china
As conditions improve, people enjoy large income gains
Car owner ship grew from 1/100 families to 1/5 families since 2000
China’s economy grew
Transfer of technology (locals adopt new technology)
China is now developing its own products
China’s banks are now some of the world’s largest TNCs
