Final answer:
The student's question pertains to 'outsourcing', which is the hiring of external contractors to perform tasks that a company's workers used to do.
Step-by-step explanation:
The process described in the question involves outsourcing, which is when a company contracts with an outside firm, often in another country, to perform tasks it used to handle internally. This could include jobs such as accounting, payroll, human resources, and data processing services. Another related concept is offshoring, which occurs when a company moves its own operations overseas to take advantage of cheaper labor markets. As companies seek lower costs, they often move manufacturing and service jobs out of developed countries, which could lead to job losses in those countries. Trade agreements like NAFTA have facilitated this process by making it economically viable to produce goods in countries with lower labor costs and then sell them in places like the United States.
For example, the U.S. has experienced a decline in manufacturing jobs while service jobs increased; this indicates a significant impact of outsourcing and offshoring on the country's labor market. Companies using these strategies often seek to optimize their costs and increase competitiveness in the global market.