Josh Marshall outsources his research

I’d like to congratulate Joshua Micah Marshall for improving his productivity by recycling a John Kerry press release in his snarky post on offshore outsourcing. Sure, some bloggers might have dug a bit deeper to get more information — like the fact that John Kerry’s policy proposals on outsourcing would have zero effect on the job losses Marshall broods about. And sure, by completely outsourcing his research to Kerry’s campaign, Marshall may have missed just a few of the nuances involved in the debate on offshore outsourcing — but Marshall did post first on this. Congratulations, Josh!! [Hey, didn’t you just do this as well?–ed. Yeah, but I said it was a press release when I did it.] More seriously, in the wake of mediocre job numbers for June, Paul Blustein has a Washington Post story that’s worth checking out on the topic. The lead paragraphs look scary:

A report by an influential consulting firm is exhorting U.S. companies to speed up “offshoring” operations to China and India, including high-powered functions such as research and development. In blunt terms, the report by the Boston Consulting Group warns American firms that they risk extinction if they hesitate in shifting facilities to countries with low costs. That is partly because the potential savings are so vast, but the report also cites a view among U.S. executives that the quality of American workers is deteriorating.

However, the story goes on to quote some interesting research findings:

Matthew J. Slaughter, a professor at the Tuck School of Business at Dartmouth, pointed to research he published in March using Commerce Department data to show how offshoring can have a positive impact on U.S. job growth, as part of the “churn” in employment that constantly eliminates jobs but also adds them. Although U.S. multinationals expanded their overseas payrolls by 2.8 million from 1991 to 2001, in moves that often involved factory closures and layoffs in the United States, they expanded their U.S. employment levels by nearly 5.5 million, according to Slaughter’s study. That is partly because as such firms expand the scale of their operations abroad, they need more personnel at home to handle functions such as marketing, logistics, finance and product design. For similar reasons, McKinsey & Co., one of Boston Consulting’s main rivals, has estimated that for every $1 invested abroad by U.S. companies, the U.S. economy gains $1.14, which can be plowed into job-creating enterprises.

Click here for a case study that buttresses Slaughter’s aggregate data. And here’s the relevant table: