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Important Ways Globalization Impact U.S. Businesses

Important Ways Globalization Impact U.S. Businesses

Globalization has made an enormous impact on the U.S. business world. It has created increased industrialization and financial opportunities and also increased social responsibility. However, it has also resulted in crime, domestic violence, homelessness, and poverty.

Increased industrialization and financial opportunities

The United States began a period of rapid industrialization in the mid-1870s. Its economy moved from agricultural to industrial, creating many new jobs, manufacturing opportunities, and increased wealth.

New machines, labor-saving inventions, and government policies fueled industrialization. A corporate business organization also provided a new means for large-scale financing. As a result, industries such as the railroad and communication networks expanded to accommodate the new production capacity. A growing population and a burgeoning financial sector complemented this new capacity.

A colorful group of entrepreneurs led the way. They helped to lead the nation through its economic transformation.

The Industrial Revolution is among the critical events in the history of the world. Not only did in what way will globalization impact US businesses and change the way people lived, but it also created the modern world. However, it was accompanied by harsh repression and poor working conditions for workers.

Increased crime, domestic violence, homelessness, and poverty

Increased crime, homelessness, and poverty can seriously affect the U.S. economy. It is especially true in urban areas where crime is a significant factor in property values, commercial activity, and family stability. Unfortunately, in many cases, these factors are often out of the control of those affected. The criminal justice system is often too slow or ineffective to solve most crimes. In addition, victims of crimes have difficulty breaking out of the cycle of poverty.

Numerous statistics point to the prevalence of violence. For example, the number of people killed in violent crimes in the United States is well over one million. The number of victims of domestic violence is even higher, with almost three million people displaced from their homes by the end of 2006. While plenty of organizations are dedicated to combating this issue, it isn't easy to track the effectiveness of these programs.

Homelessness was a more pervasive problem in the U.S. than in 1990, when 228,621 people were reported homeless in cities. More than half of all homeless persons are male, while 67.5% are single women.

Labor-cost arbitrage

Labor-cost arbitrage is a practice used by firms to shift the production of goods and services to lower-cost regions. In the past, it was the dominant feature of the offshoring movement. Today, the benefits of labor-cost arbitrage are being eroded by the rise of automation. It can be challenging to tell what will happen to trade based on labor-cost arbitrage shortly, but some indicators show the shift is accelerating.

One of the biggest reasons for the declining share of trade based on labor-cost arbitrage is the rising wage costs in developing countries. It is because exports from countries with a low GDP per capita drive labor-cost arbitrage. As a result, companies can overpay up to 30 percent for outsourced full-time employees. The cost of shipping, as well as the cost of communications, were essential barriers in the past.

However, new technologies have made it possible to use many-to-many labor trading. These platforms can help employers find workers in cheaper markets and encourage more cooperative production relations. They can also greatly expand the pool of potential workers available to employers.

Increased social responsibility

Globalization has affected the way U.S. businesses approach their CSR. It has also influenced how national governments view businesses' role in social responsibility.

Companies now have an ethical obligation to contribute to society's social and economic welfare. A growing number of firms are taking this responsibility seriously. Businesses must consider both short-term profits and long-term benefits to be competitive.

Businesses need to ensure a healthy workforce. Employees who feel they are making a difference can boost productivity and morale. The ability of companies to invite top-tier employees is a crucial benefit. They can also increase profitability through superior brand recognition and philanthropy.

As a result, there has been an increase in corporate responsibility programs in recent years. Moreover, the government has been more involved in promoting CSR. It has led to the development of several CSR programs and policies.

Companies need to consider their social standing before launching their businesses. For example, large firms tend to recruit employees who want to make a difference.  Together these are some of the key ways globalization impact U.S. businesses.

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