How do globalization and outsourcing affect industrial workers?

Globalization and outsourcing significantly impact industrial workers, particularly in developed nations, in ways that often manifest as job losses and wage stagnation. As companies seek to reduce costs, they frequently relocate production facilities to countries where labor is cheaper, resulting in the displacement of workers in higher-cost regions. This shift leads to a decrease in the number of manufacturing jobs available domestically, which can cause unemployment or underemployment for many industrial workers.

Furthermore, for those workers who remain employed, wage stagnation is a common outcome. As job markets become more competitive due to the influx of international labor, wage growth can stall, and workers may find it challenging to negotiate for higher pay. Employers may leverage the threat of outsourcing as a means to suppress wage demands, leading to prolonged periods of stagnant wages despite increases in the cost of living.

The option suggesting that globalization and outsourcing create jobs in developing nations acknowledges a different aspect of the economic shifts caused by these phenomena. While it's true that job opportunities may arise in developing countries, the focus on the consequences for industrial workers in developed nations highlights the adverse effects such as job losses and wage stagnation as central concerns. Thus, recognizing both aspects provides a comprehensive understanding of the broader implications of globalization and outsourcing on the workforce.