As companies outsource, Whartonites fear for job prospects

Recent trends in outsourcing have left Wharton students fearful of their job prospects after graduation.

Outsourcing, which once referred primarily to sending low-skilled labor abroad, has gradually grown to encompass professional work.

“Companies are starting to outsource, not only low-end tasks, but also higher skill things,” Mauro Guillén, director of the Joseph H. Lauder Institute for Management & International Studies, said.

For example, work done by “accountants, architects, radiologists, financial analysts and attorneys has been sent to cheaper, or in the case of radiologists, more convenient labor markets,” director of Career Services Patricia Rose wrote in an e-mail.

In the past five years, students graduating from Wharton’s undergraduate program have had a harder time finding jobs, according to Career Plans Survey Reports published by Career Services. Between 2006 and 2010, the percentage of graduates seeking jobs increased, while the percentage of graduates with full-time employment decreased.

However, Wharton experts believe that outsourcing is not to blame.

“A bigger factor in recent years has been economic recovery,” Associate Director of Career Services Barbara Hewitt wrote in an e-mail.

“Up to now, and for the foreseeable future, outsourcing will have no effect, or a negligible effect, on new Penn graduates. So current students needn’t worry about a first, or even a second job,” Rose added.

Outsourcing is not necessarily a bad thing, according to Guillén. Companies that are looking for lower costs send their labor abroad, which makes goods cheaper for American consumers.

“We shouldn’t try to keep low paying jobs here,” he said. “We need to be able to outsource to compete with other nations.”

Guillén added that the primary concern with outsourcing should be preventing the exploitation of workers in foreign countries. He cited the example of Nike, a company which has been accused of profiting from sweatshop labor.

“American consumers can be blamed for this problem,” Wharton senior James Calderwood said. “We’re not willing to pay more for better conditions for workers.”

Although there is no simple solution to this problem, one way that the United States can stay competitive is to train and educate the next generation of Americans, according to Guillén who believes that this can begin at Penn.

“We are training people to become good engineers or good managers. Wharton, and Penn in general, is making a very important contribution to the U.S. economy,” he added.

“The world is changing, the workforce is more fluid, and communication technologies are contributing to that,” Rose added. “Something for current students to think about as they imagine what their future careers might look like.”

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