Effects of offshore outsourcing on a nation

•First attempt to integrate social cost of outsourcing.•A macro analysis of offshore outsourcing at a national level.•Compares and contrast nations engaged in offshore outsourcing.•Trend analysis of effects of outsourcing at state level in the USA.

This paper analyzes the effects of offshore outsourcing at a macro level for a nation. It contains trend analyses of national data to address the research question “Does offshore outsourcing correlates with economic growth and prosperity of the people at large and in the long run for an outsourcing nation?” by analyzing various economic indicators. This paper pays a special attention to how employment rates and revenues from imports are affected by offshore outsourcing. Further, the paper contrasts these trends for the USA and Germany. The analyses of the data collected show that offshore outsourcing affects a nation’s economic growth and the prosperity of its people. The findings suggest the need to promote local/regional manufacturing in/near the country of consumption.