By Karen Musalo Production costs are lifting. Your company can do more money for stockholders by relocating your workss to a state with lower labor costs and fewer ordinances. You are the main executive of Electrocorp. an electronics company. which makes the onboard computing machine constituents for cars. In your production workss. complex hydrocarbon dissolvers are used to clean the french friess and other parts that go into the computing machine constituents. Some of the dissolvers used are carcinogens and must be handled with utmost attention. Until late. all of your production workss were located in the United States. However. the cost of production has risen. doing net incomes to worsen. A figure of factors have increased production costs. First. the brotherhood stand foring the workers in your works waged a successful work stoppage ensuing in increased wage and benefits. The wage and benefits bundle for get downing employees is around $ 15/hour. A 2nd factor has been rigorous safety ordinances. These safety processs. which apply inside the works. have been expensive in both clip and money. Finally. environmental ordinances have made Electrocorp’s operations more dearly-won.
Electrocorp is required to set its waste through an expensive procedure before lodging it at a particular disposal installation. Stockholders have been kicking to you about the worsening lucks of the company. Many of Electrocorp’s rivals have moved their operations to less-developed states. where their operating costs are less than in the United States. and you have begun to see whether to relocate a figure of workss to offshore sites. Electrocorp is a major employer in each of the U. S. metropoliss where it is located. and you know that a works closing will do economic disruption in these communities. You know that the employees who will be laid away because of works closings will hold trouble happening tantamount places and that increased unemployment. with its attendant societal costs. will ensue.
However. you are cognizant of many other corporations. including your rivals. that have shut down their U. S. operations. and it is something that you are willing to see. You have hired a adviser. Martha Smith. to look into the sites for possible works resettlement. Ms. Smith has old ages of experience working with companies that have moved their operations to less-developed states to cut down their operating costs. Based on your ain research. you have asked Ms. Smith to more to the full look into the possibility of operations in Mexico. the Philippines. and South Africa. A sum-up of her study and recommendation for each state follows:
Mexico A figure of boundary line metropoliss in Mexico would be cost-effective resettlement sites based on both labor. and wellness and safety/environmental factors. Workers in production workss comparable to Electrocorp’s gain about $ 3 per twenty-four hours. which is the prevailing pay. There is frequent worker turnover because employees complain that they can non populate on $ 3/day. and they head north to work illicitly in the United States. However. a ready supply of workers takes their topographic point. Mexican wellness and environmental Torahs are besides favorable to production. Exposure to toxic chemicals in the workplace is permitted at higher degrees than in the United States. leting corporations to distribute to some grade with dearly-won processs and equipment. Mexico’s environmental Torahs are less rigorous than those of the United States. and a solvent recovery system. used to cut down the toxicity of the waste before dumping. is non required. The lone identifiable concern hazard is possible bad promotion. The rate of birth defects has been high in many Mexican boundary line towns where similar workss are in operation. Citizen wellness groups have begun protests. impeaching the companies of taint taking to illness.
Philippines Conditionss in the Philippines are more favorable than those in Mexico in footings of labor and wellness and safety/environmental factors. The prevailing pay in the Philippines is about $ 1/day. and immature workers ( under 16 ) may be paid even less. As in Mexico. the workers complain that the rate of wage is non a life pay. but it is the present market rate. The wellness and safety and environmental ordinances are tantamount to those in Mexico. but there have been no public ailments or resistance sing birth defects. malignant neoplastic diseases. or other unwellnesss.
South Africa Conditions in South Africa are positive in some respects. but non as favorable in economic footings as in Mexico or the Philippines. The prevailing pay in South Africa is about $ 10/day. Furthermore. there is a strong brotherhood motion. significance that there may be future demands for additions in rewards and benefits. The brotherhoods and the authorities have been working together on wellness and safety issues and environmental protections. Exposure to toxic chemicals in the workplace is non permitted at every bit high a degree as in Mexico and the Philippines. Although the equipment necessary to cut down toxic chemicals to an acceptable degree is non every bit dearly-won as in the United States. this disbursal would non be incurred in the other two states. Furthermore. there are demands for a solvent recovery system. which besides increases operation disbursals.
