External Production and Employment: The United States Experience

Abstract

This work titled external production and employment: the United States experience view external production as expansion of firm’s activities and market penetration to enable multinational enterprises enjoy economies of scale, larger market share as well as seek strategic assets capability and repatriate earnings to home countries. The objective of this work was to examine the effect of external production on employment in the United States with specific objectives of assessing the effect of market penetration on job losses in the US and to examine the relationship between total US imports on job creation. The study adopted a descriptive assessment of previous works on US job losses. Findings from the study revealed that external production by the US MNCs has aggravated unemployment and that external production by US MNC has a significant negative effect on US imports in balance of payment. The study recommended that US government should put in place measures that will restrict their MNC from leaving their shores for search of natural resources, cheap labour and market for finished products therefore providing jobs that may be taken to external markets.