Job Analysis and Globalization

Offshoring refers to the movement of jobs to locations beyond a country’s borders. There are substantial differences in hourly compensation costs across countries for manufacturing workers; this has played an important role in companies’ decisions about where to locate production operations. Of course, labor cost is only part of the story. There are productivity differences across countries as well, meaning that lower labor costs may in some cases be offset by lower productivity. Availability of workers with needed education and skills is another potential constraint. Proximity to customers is yet another issue. Sometimes that argues for moving offshore, sometimes it does not. Interestingly, highly susceptible jobs include not only those that require little education and training, such as data entry keyers and telemarketers, but also computer programmers and tax preparers. Jobs with low susceptibility to outsourcing include managerial positions and those where local knowledge or being “on the ground” is required. As firms spread work across multiple countries, there is an increasing need to analyze jobs to either maintain consistency in job content or else be able to measure the ways in which jobs are similar and different. One potential challenge is that norms regarding what is and what is not part of a particular job may vary across countries.