Why Outsourcing is Ethical

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When the topic of outsourcing work overseas comes up, the question inevitably comes: “Is this ethical?” Many will give the answer that outsourcing to foreign nations exploits workers by paying them small wages or that it is essentially slave labor. Opponents of this business model also criticize what they see as taking jobs away from local prospective employees and giving them to workers on the other side of the globe.

Unfortunately, these are common points of view. The truth is, people who believe that the type of outsourcing I teach is unethical simply don’t understand what I do and what thousands of other business are doing with virtual assistants in the Philippines.

How hiring a Filipino VA is different

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When I talk about outsourcing, I’m not concerned about companies eliminating local positions and having a bunch of people overseas do the work instead. I have developed a successful system where entrepreneurs and small-business owners hire Filipino workers to fulfill the tasks in their business. These are tasks that the business owner himself or herself was doing; these aren’t assignments that had been the responsibility of a fleet of U.S. workers and now those jobs were being taken away.

Hiring a VA from the Philippines unloads a large burden off the shoulders of the business owner. It allows him or her to stop working in the business and being working on it. Put another way, if you hire a Filipino VA, you can stop worrying about completing everyday tasks of things like programming, graphic design, copywriting, social media campaigns or a host of other things. You can instead entrust these responsibilities to a worker in the Philippines and move on to things you’ve neglected because you haven’t had the time—things that make you money like sales.

Outsourcing your small-business needs to the Philippines is a win-win for you and for the Filipino VA.

A question of pay

Perhaps the biggest argument people make against outsourcing is the low wages business owners pay overseas workers. Critics of outsourcing deride companies and individuals for doing this, saying they’re exploiting workers and taking advantage of them by paying them unfairly for the work they do. Let me explain how this is an inaccurate point of view.

I pay my VAs between $450 and $900 a month, depending on the duties they perform. Experienced programmers, for example, will make more than a copywriter or SEO specialist. To most, these salaries appear alarmingly low. In the United States, these would indeed be low salaries—very low, in fact. No one in the United States could expect to live on $450 a month, but in the Philippines, this is an average salary.

As of April 30, 2016, the average monthly salary in the Philippines was around $300 a month, so it’s clear that I actually pay my VAs a very healthy wage compared to others in the country. What’s more, the cost of living is substantially lower in the Philippines than it is in the United States. Housing, for example, can cost more than 10 times as much in the U.S. as it does in the Philippines. Food, transportation and entertainment are also far cheaper in the Philippines. People in the Philippines can live comfortably on the wages I pay.

I once had a VA tell me that he regularly lends money to his father because he makes far more than him. Another VA once told me that he was teaching all his friends to do what he does because he makes double what any of them make. They don’t say these things to brag, but to point out that they are paid more than fairly and appreciate the salary they earn.

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Neither I nor the entrepreneurs who employ Filipinos are shortchanging them or treating them unfairly. In addition to above-average starting pay, I give my workers regular raises as their performance merits. I also honor the 13th Month in the Philippines by paying a second a paycheck in December, equivalent to one month’s pay.

Other business owners who have excelled in outsourcing to the Philippines know and understand that this method is not unethical. Entrepreneur Scott Smith has hired Filipinos to help him to local business marketing, said outsourcing is simply good business. “My clients feel like they’re getting a deal,” he said. “That’s a business. That’s not immoral; that’s not unethical,” he said. “A business is when you outsource or buy low, and you sell high.”

Another advocate of outsourcing once posted some comments on our Facebook page, pointing out that outsourcing overseas makes financial sense for the business. He wrote, “By definition, the purpose of a (for-profit) business entity is to make as much money as it can for the company/owners. This includes company leadership using available resources in a smart and efficient manner, which means paying the lowest prices for materials/labor (of the quality desired) that are available within the market, and then attempting to seek the highest prices for its products, as dictated by the market.

“The company’s focus, by definition, is/needs to be on maximizing its own profit. It is not in business to save the world or ‘care’ with an altruistic mindset (that is, by definition, the purpose of a nonprofit organization) about the financial concerns of employees or the economy, and certainly should certainly not hurt/weaken itself to pay more for something than is necessary. Doing this only leads to the company being weakened, with its success limited to mediocrity (at best), and is quite likely to go out of business as a result. If cheaper labor is available that allows a company to keep its doors open (or be more competitive) in an already-highly competitive global market, then the company should indeed at least consider this as an option.”

Outsourcing changes lives

One of the most appealing things about outsourcing to the Philippines for the entrepreneur is the way it changes their business. If done correctly, working with a Filipino VA allows you to become the CEO of your business and run it the way you always wanted to.

But outsourcing is about more than you. Outsourcing has changed the lives of thousands of Filipinos.

I recommend hiring VAs full time rather than part time. Not only is this an advantage for you, but it’s a tremendous opportunity for your Filipino worker. That’s because full-time work is hard to come by in the Philippines. Many people work part time, and those lucky enough to find full-time jobs often does so on a temporary basis. But when you hire a full-time VA for your business, you are giving them long-term, stable, consistent work that they would otherwise have a difficult time finding.

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What’s more, by hiring a VA, you are allowing a Filipino to work from home, possibly with flexible hours (if you decide that’s OK). A Filipino named Joven has shared his experience of finding a position as a VA on onlinejobs.ph and how it completely changed his life and the life of his family. Joven had previously worked a few different jobs that required long commutes and long work hours. He had little time with his wife and young son. It was exhausting and unfulfilling. But when Joven started working for an American business owner as a VA from home, everything changed. He was able to watch his son while his wife was at work. He had time to tend to his son’s needs and play with him, all while still completing his assignments as a VA. Joven made a good income without having to work grueling hours or sacrifice family time.

Joven’s story is not unlike the stories of countless other Filipinos. Thousands have found challenging, rewarding work that has enabled them to support their families and live the lifestyle they wanted. These Filipinos certainly don’t feel exploited; they are humbly grateful for the opportunities they have been given. Another worker named Arvel actually made a short YouTube video about how outsourcing to the Philippines benefits both the worker and the business owner. She talks about how her job not only allows her to help her family but even her community, especially when a disaster such as a typhoon hits. Her job allows her to rebuild after a natural disaster and even allows her to lend a hand to family and neighbors.

Look at the big picture

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If you’ve heard the criticism and cynicism about outsourcing, or if you’ve got questions yourself, dig a little deeper and consider the factors we’ve discussed here. The Philippines is not the U.S. Conditions are different. The culture is different. A little bit can go a long ways there. And what may seem like a meager wage to an American or other Westerner is actually a life-saver for a Filipino. Sure, outsourcing to the Philippines is a strategic business philosophy designed to increase your profits. But just as importantly, it truly transforms the lives of countless Filipinos.

Source: Why Outsourcing is Ethical – OJ Blog

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