The business practice of hiring workers in another country is known as

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Q. The business practice of hiring workers in another country is known as:

  1. Globalization
  2. Insourcing
  3. Subcontracting
  4. Outsourcing

ANSWER: 4. Outsourcing


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The practice of hiring workers across international borders is known as Outsourcing.

In this, the business practices are conducted outside the mainland by the number of different methods. One method of outsourcing is hiring freelancers from other countries. The second method is to locate a company in a different country. Another method can include hiring a company in other countries.

There are considerable advantages to outsourcing. The prime advantage is economical. In countries like the U.S., there is a fixed minimum wage fixed by the government.

In such a situation, keeping up with the competitive cost becomes difficult. For this, companies like Apple, design their products like iPhone in California but the manufacturing takes place across Asia.

Another advantage of outsourcing is that the barrier of location is removed. Skilled labor can be hired based on talent, not according to location.

It is a quite common practice opted by companies of many developed countries, where outsourcing is done to underdeveloped and developing countries.

The developing and under-developing countries also offer attractive offers to the companies so that they can invest in their country. This practice benefits the outsourced countries too as it brings employment opportunities to skilled and unskilled labor.


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The business practice of hiring workers in another country is known as:

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