When Companies Move Their Business Overseas

The “Great Recession” of 2008 left no one untouched. Many people held their breath as their co-workers were laid off and hoped they weren’t next. They lost their homes, cars, and savings. Companies struggled to stay afloat and to take care of their employees, sometimes having no option but to close.

One company in the northwest, Micron, was no exception – but it hits close to home. During that time, employees knew that the company was doing what it could for the benefit of its employees. Layoffs were happening all across the country, so while it hurt, it wasn’t unexpected and it wasn’t solely the fault of the company.

Afterall, Micron had taken care of its employees for years, giving them great healthcare plans and throwing the best community holiday parties. Now, 10 years after the recession, the security kiosks are still empty, and many jobs that were not considered “essential” to the company in 2008 were never re-hired, but for the most part, it has recovered.

Last year, the same company announced that they were making more money than ever. The same week they announced their current success with profits, they made another announcement to their employees. They told them that they would be closing one department and outsourcing the work to Taiwan.

This announcement that affected hundreds of employees was completely unexpected, took less than a minute, and left everyone speechless. Over the next few days, each worker learned their fate. Some were laid off immediately and were told not to come in on Monday. Some were told they could work there for a bit longer, ranging from three months to a year and a half. A couple were offered jobs in Taiwan to help train the overseas employees who would be taking their jobs.

The Company’s Best Interest

moving-business-overseasOf course, when it comes down to it in a market economy, the company’s best interest is to do whatever it takes to make more money. Shutting down a branch in the US and taking it to an international location will keep costs down and bring up the overall revenue.

However, it is not without consequences. For one, closing off a department kills positive company culture, which according to Pepperdine University of Business, is damaging to business and takes focus away from production.

Taking one department overseas is likely just the first step in moving the whole division over. As employees think about the future implications for the company, rumors spread. As employees feel their jobs are unsafe — even if this is not the case — it brings morale down in the office, which has negative effects on productivity.

The Company’s Responsibility

On the other hand is the company’s responsibility to its community. Part of running a business and managing employees is to keep their best interests in mind, as well as the trajectory of the company. In order to keep a positive business reputation, one of the most important elements is to commit to positive actions. However, not all businesses run this way.

Certainly, part of the company’s commitment to the employee is to give them a severance package, which provides the employee with a few months of cushion. This time gives the former employees a chance to find a new place of work while being able to pay their bills.

This is the case with Micron, except that several months after they made an offer to some employees, they went back and revised it. Those who had been offered a year and a half more of employment were now being told that they were cutting off the last three months from the agreement.

Impact on the Workers

Now, there are many workers left without a job. Some had worked at the company for over 20 years. Some were far enough away from retirement that they would now need to find a job, but close enough that potential employers might not see them as a valuable, long term asset.

Employees were informed that they could apply for other positions in the company, and many were able to secure jobs that way. Others, however, chose not to, either feeling betrayed by the company or unwilling to find themselves in the same situation in a few years as the company outsourced more and more departments.

This situation is not unique by any means; employees all over the world have encountered the same situation. As globalization becomes a more and more common phenomenon, more companies are choosing to outsource their production.

This has become so commonplace that it’s no longer news. Though it helps the company make money, it can have a lasting negative impact on the original community, and it doesn’t usually help the community they outsource to either.

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Geo SiqueAuthor: Geo Sique is a content creator from Boise, ID. Passionate about social justice, she frequently writes articles on culture and societal issues and aspires to make a positive impact through her writing.