Offshoring manufacturing: Implications for engineering jobs and education: A survey and case study

One result of globalization is the rapid growth of offshoring, i.e., the outsourcing of functions and jobs to offshore locations. In the USA, offshoring has progressed to the point where it already affects everyday lives, from the cars we drive (of which a large portion of the work and components are outsourced) to computers (which are typically manufactured offshore and shipped back to the USA), to electronic diagnostics (where calls are answered overseas). This phenomenon has implications on our lives and on the jobs that engineers and scientists will assume both now and in the future. Further, it is something that all highly developed and even some lesser-developed countries must face. Consequently, the growth of outsourcing will have a major impact on the educational objectives of engineering programs and the resultant engineering curricula worldwide. This paper presents recent data on product and job offshore migrations and discusses the various dimensions of this phenomenon. In addition to the potential loss of engineering and other high-end technical jobs, sociological and cultural aspects, intellectual property issues, strategic planning concerns, and macro-economic issues are presented. For example, the effects of offshoring on the societal fabric of the countries that are recipients of manufacturing and service center outsourcing, such as China and India, are significant, rapid, and controversial. Offshoring has also begun to change the way that engineering programs in these countries educate their students. In addition, intellectual property issues create a major risk to companies considering outsourcing to certain less-developed countries. These issues can be broadly categorized into: the robustness and strength of intellectual property laws, and the degree to which these laws are implemented and enforced. Further, such factors as currency fluctuations and geo-political conditions can substantially impact outsourcing decisions and profitability. The phenomenon of offshoring, which is now affecting engineering careers, will play a major role in shaping engineering education worldwide. The next generation of engineers will need to possess the ability to work seamlessly across cultures, have outstanding communication skills and be familiar with the principles of project management, logistics, and systems integration. Some educational models that begin to address these requirements will be presented. (C) 2006 Elsevier Ltd. All rights reserved.