Following are some myths and their facts connected to outsourcing which are very famous in corporate world and why companies from U.S fear from outsourcing.

MYTH: the process of outsourcing gives profit to companies and they will reinvest that amount to invent more jobs for American workers. The myth is that if outsourcing is stopped it will hurt them in future.

FACT: It is not so that the companies that increase their profits by outsourcing will use that profit for the benefit of the working class in America. It has been found in study done by McKinsey that if five cents or every single dollar comes back to America, 95 cents are still less in getting invested in America if the company had not outsourced the work.

MYTH: Only low-profile work is outsourced and this outsourcing sets workers free to look for a more innovative job. This forces the companies in U.S to look to higher value added activities and invent new techniques. All this are advantageous for economy

FACT: Absolutely no limit is there to the type of work that can be outsourced but the condition is that the data should be transferred on phone or internet. The trend of outsourcing has changed its way and moving more towards engineering, research and designing from call centre and tele-calling. As per CEO of Intel Mr. Craig Barret “Unless you are a plumber, or perhaps a newspaper reporter, or one of these jobs which is geographically situated, you can be anywhere in the world and do just about any job”.

MYTH: The myth is that companies outsource work when there is a shortage of workers in America. These companies should take advantage of skills of millions of people in Asia and if Americans want to compete they have to get more brain rather than trade restrictions.

FACT: This is a myth that there are no able workers in America and that’s why work is outsourced. The fact is that by outsourcing, companies can find workers who will work in fewer amounts rather than charging high price. Skill is still in America and the only point is it is not used by companies as they are taking advantage of lower wages in India and china.

MYTH: Restrictions on outsourcing by public contractors end up and costs the tax-payer more money. The government of every state must be permitted to look for the best value of tax-payers each and every dollar doesn’t matter, if it is done by sending work to other counties.

FACT: It is not very clear in America that savings of any private company is passed to the government. Companies that outsource their work can keep their entire profit and give a small amount to tax-payers. The other thing is that even if government pays more for contracts, this process can be a very clever decision.

MYTH: The government is not trying to legislate on issues regarding international trade. Corporate in America think that this issue is serious enough to be solved by federal government as state governments may violate trading rules.

FACT: the fact is that under the constitution of America state governments have lots of freedom and sovereignty over the way they spend their money. This is the reason why these states are not bound to follow any international laws or rules of government procurement. States that have agreed to follow the agreements do not come under that rule, individually and international trade tribunal cannot penalize them or force them to change their laws of procurement.