**4.2 Offshore-outsource vs. air pollution tradeoff**

Materials that feed the manufacturing industry are localised. The transport of raw materials from Uganda, the Philippines or Vietnam to outsourcing-offshoring economies could mean incurring high transportation costs. Besides, the stringent environmental laws in developed economies could make the processing of such materials practically impossible. Before the UK and US started practising outsourcing-offshoring of some types of business, they had some of the worst air pollutions in the world. The processing operations were sent to the likes of China and India, countries that are now experiencing the worst air pollution ever [21, 22]. Though outsourcing-offshoring countries have paid some price in terms of job losses, the benefit of improved air and water quality somewhat outweighs the price.

*Outsourcing and Offshoring*

work from home, including internet connections and secure systems access, many

The outsourcing-offshoring industries do not lend themselves to working from home. For example, because of security concerns, some companies even ask employees to leave even their pens and pencils outside the office. Specifically, the companies that relied on outsourcing firms for their testing services were left in a lurch. Digital quality is now more critical than ever, given our global reliance on digital experiences, and the companies providing those digital experiences are unable to get the testing they need from offshoring-outsourcing firms. In technology, offshoring is simply moving testing from one office to another. Due to cultural and technological factors, that new office may be less capable of ensuring business continuity during a crisis. In addition, offshoring testing services does not equate to

The pandemic has been a wake-up call for outsourcing-offshoring economies; why was the US manufacturing industry unable to supply the necessary materials like face masks, medical ventilators, and PPE? Taken together, the US and other advanced industrial economies have evolved a highly efficient and productive product manufacturing-and-delivery system that provides them with a cornucopia of products at relatively low costs. However, inherent to that system are dependencies and expectations that have been called into question by the pandemic. Such performance has fuelled politicians and policymakers to advocate for a reduction in the outsourcing-offshoring business—cementing President Trump's call to bring

The US alone reduced the corporate rate from 35–21% to encourage companies to re-offshore. Besides that, some US policymakers are proposing a \$25 billion fund for companies to re-offshore/re-outsource back to the US from China for the next five years [16]. Companies like Telstra™ in Australia that depend heavily on the Philippines have enacted plans to hire more than 3500 workers back home [17]. At a glance, COVID-19 is likely to deaccelerate outsourcing-offshoring businesses. However, the issue is complex and defies easy solutions, as discussed in the follow-

The challenge lies in a combination of how modern supply networks are structured and the operational metrics that apply to manufacturers. Gone are the days when one giant manufacturer, like CAT™ or Toyota™, could design, manufacture, and assemble the components needed to make a product. Today's manufacturing technology is too complicated to have all the skills in one place. Thus, manufacturers have resorted to outsourcing-offshoring to search for those missing skills at a lower cost. Even something as simple as a lightbulb has components like LED lights that must be made in high-tech industries. Day-to-day equipment like smartphones, computers, and medical equipment contain components that require a great deal of

precision and accuracy, and that need considerable training and experience.

and gloves) and ventilators; the latter being the most technical that requires detailed skills and experience to manufacture. A ventilator blows air and oxygen into the patient's lungs, preventing them from collapsing. They are complicated pieces of machinery that cannot be created or grafted quickly. At the start of the

During the pandemic, among the items in most demand were PPE (e.g. masks

outsourcing firms require client permission for them to do so.

an increase in skill sets or the ability to do different types of testing.

**4. Pandemic offshore-outsource tradeoff**

the production industry back from overseas.

ing offshore-outsource tradeoffs.

**4.1 Offshore-outsource vs. onshore skills**

**108**

Air pollution is responsible for 4.2–7.0 million premature deaths every year [3, 23], and it costs \$4.6 trillion per year [24]. This number barely makes headlines, although it is more than five times the current COVID-19 deaths. COVID-19 has elicited that there is a clear correlation between emissions and outsourcingoffshoring. **Figure 4** shows the mean tropospheric nitrogen dioxide concentration (μmol/m<sup>2</sup> ) as a satellite image from the National Aeronautics and Space Administration (NASA) in January and February 2020. The levels of NO2 plummeted following the virus outbreak in far Asia [25] due to the closure of factories and reduced movement of workers that use cars to go to work. The decrease in ozone precursors, like NO2, could reflect a reduction in ozone levels; however, ozone concentration increased. Ozone breathing triggers COVID-19 like symptoms like chest pain, coughing, and airway inflammation [26]. Another pollutant that is related to manufacturing is particulate matter (PM). PM elevates cancer, premature deaths, coughing and eye diseases, among others [27]. The production of particulate matter below 2.5 microns (PM2.5), a harmful emission, accelerated in countries like China [28] due to outsourcing-offshoring business in the country. As countries are rushing to tradeoff offshoring and outsourcing companies back home, they should meticulously calculate the cost related to air pollution; otherwise, pollution costs might outweigh such a venture.
