A very informative article about the impact of outsourcing.

The tl;dr version:

Between 1980 and 2000, India, China, and the former Soviet block joined the rest of the global economy. They had enough potential workers to basically double the global labor supply, but had relatively little useful capital (because of poverty and technological obsolescence). We now have twice as many workers competing to sell their labor to the same supply of capital. Which means that wages are going to fall.

Globalization is good for employers and Indian/Chinese/Russian workers. It sucks for American and Western European workers - even skilled, highly educated workers, because Indian/Chinese/Russian workers are becoming skilled and highly educated very quickly.