Global Sourcing of Talent: Implications for the U.S. Workforce

The global sourcing of talent—commonly called “offshoring”—has become an issue of substantial public and political interest in the last few years. Although the 1973 landmark publication Work in America made no mention of outsourcing to third-party providers or the movement of jobs abroad, these trends have been shaping employment dynamics in the manufacturing sector for more than three decades. Historically, American employees in the service sector have gained from global trade, because companies around the world sought expertise from U.S. providers, particularly in high-end technology and research and development.1 However, it is the more recent phenomenon of global talent sourcing—in which white-collar service jobs move from high-wage to low-wage countries—that has captured new attention. With services making up 67 percent of the U.S. economy and the substantial increase in global trade in services over the last 20 years (Karoly and Panis 2004, 133–134), it is no surprise that Americans express alarm when service jobs start moving offshore.