The notion of relocation refers to the act and result of relocating . This verb , for its part, refers to the transfer of an industrial activity from a country or a region to another place with the aim of lowering production costs.
Offshoring, therefore, involves the transfer of jobs , capital and productive processes from one place to another to obtain a competitive advantage. Although this type of decision is usually linked to a reduction in costs, it can also be associated with the search for better infrastructure or more qualified personnel.
Suppose a company produces sports shoes in the United States . Due to an increase in costs, the owners decide to relocate their production plant, and therefore move it to China . In this Asian country they can pay lower wages to workers and have a lower tax burden. In this way, while the production of a pair of sneakers in the United States cost the company $50 , in China the amount drops to $30 . This allows you to increase your profit margin.
For the region that loses productive activity, relocation is usually a social problem . When a factory leaves a territory, many people are left without jobs . In addition, there is a loss of indirect jobs (those intended to meet the needs of factory employees).
The areas that benefit from relocation, for their part, manage to create jobs, although they are generally poorly paid. This leads us to reflect on the balance of this business tactic, so common today; It is impossible to find a balance in which both regions benefit equally, since the office move itself is carried out with a well-defined interest, which has little to do with generosity or compassion for the workers involved.
When a company makes the decision to resort to relocation to lower its production costs , it knows perfectly well that this practice can offer benefits only because the world is not well organized: thanks to the fact that wealth and natural resources have not been distributed equally. equitable to all countries, there will always be easy points to exploit.
In the cities that become the targets of relocation, there are generally no large national companies, but activities usually revolve around production for important multinationals with foreign roots. In an ideal world, no company should exploit its workers to achieve a favorable profit margin, because it would also not have the pressure to create new products every year or offer them at an extremely competitive price.
Leaving aside the moral issues behind relocation, we cannot deny that thousands of people benefit from this measure, since jobs in these facilities usually require a lower degree of prior knowledge and official qualifications . Furthermore, it is common for the number of places to be much larger than in the main offices : for example, while in a studio of a French software development company there may be space for forty workers, it is likely that abroad they will have groups of more. of two hundred.
Another benefit of relocation for those who receive the opportunity to work in a foreign company is the possibility of a future transfer to the headquarters: many people take their first steps doing monotonous and relatively poorly paid jobs but over time they manage to attract the attention of their employers positively and then access higher positions, outside the relocation system .