What is the term for when companies have work completed in another country where labor costs are lower?

The term used for when companies have work completed in another country where labor costs are lower is outsourcing. This practice allows businesses to reduce expenses by contracting work to firms or individuals in locations where wages are more affordable, or by transferring certain business functions to third parties.

Outsourcing typically involves tasks such as manufacturing, customer service, or IT services. It enables companies to focus on their core operations while leveraging cost efficiencies provided by service providers in different geographic areas.

While offshoring also refers to relocating work to another country, it is more specifically associated with the practice of moving operations to a foreign land, regardless of whether it is managed internally or through external third parties. Insourcing, on the other hand, refers to bringing tasks back in-house instead of contracting them out, and nearshoring involves outsourcing to a nearby country, which may not necessarily focus on lower labor costs. Thus, outsourcing is the most accurate term to describe the scenario of utilizing labor from other countries primarily for cost advantages.