China trade costs US 1.5 million jobs

[paineinthearse]

http://www.epinet.org/subjectpages/trade.cfm?CFID=4158546&CFTOKEN=19094789

The cost of U.S.-China trade hurts labor market in all states
The United States' trade deficit with China has increased twenty-fold since the late 1980s, rising from $6.2 billion in 1989 to $124 billion in 2003, and displacing 1.5 million jobs. That deep trade deficit with China is the focus of an EPI Working Paper which charts, state-by-state and industry-by-industry, its impact on the labor market in every state and the District of Columbia.

http://www.epinet.org/workingpapers/epi_wp270.pdf

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Additional coverage in Asia Times


http://www.atimes.com/atimes/China/GB09Ad05.html

Asia Times is publishing on its site a comprehensive and lengthy
economic study performed by Dr. Robert E Scott, who is the director
of international programs at the Economic Policy Institute (link to
Institute is available at the end of AT article). Really interesting
article.

Feb 9, 2005
China trade costs US 1.5 million jobs
By Robert E Scott

The rise in the United States' trade deficit with China between 1989
and 2003 caused the displacement of production that supported 1.5
million US jobs. Some of those jobs were related to production or
services that ceased or moved elsewhere; others were jobs in
supplying industries. These jobs reflect the effect on labor demand -
in lost job opportunities - in an economy with a worsening balance
between exports and imports. Most of those lost opportunities were in
the high-wage and job-hemorrhaging manufacturing sector. The number
of job opportunities lost each year grew rapidly during the 1990s and
accelerated after China entered the World Trade Organization (WTO) in
2001. The loss of these potential jobs is just the most visible tip
of China's impact on the US economy.

During the 14-year period covered by this study, there has been a
significant shift in the kinds of industries suffering job
displacement, a shift that runs counter to initial expectations.
Where the largest impact was once felt in labor-intensive, lower-tech
manufacturing industries such as apparel and shoes, the fastest
growth in job displacement is now occurring in highly skilled and
advanced technology areas once considered relatively immune, such as
electronics, computers, and communications equipment.

Major findings of this study

The loss of job-supporting production in the United States due to
growing trade deficits with China has more than doubled since it
entered the WTO in 2001. The 1.5 million job opportunities lost
nationwide are distributed among all 50 states and the District of
Columbia, with the biggest losers in numeric terms being California
(199,922), Texas (99,420), New York (81,721), Pennsylvania (69,822),
Illinois (69,668), North Carolina (62,698), Florida (60,026), Ohio
(58,094), Michigan (50,991) and Georgia (46,848).
The 10 hardest-hit states, as a share of total state employment, are
Maine (14,951, or 2.47%), Arkansas (19,123, 1.67%), North Carolina
(62,698, 1.65%), Rhode Island (7,548, 1.56%), New Hampshire (9,443,
1.53%), Indiana (43,533, 1.50%), Massachusetts (46,463, 1.46%),
Wisconsin (39,668, 1.43%), Vermont (4,211, 1.41%) and California
(199,922, 1.39%).

China's exports to the US of electronics, computers and
communications equipment, along with other products that use more
highly skilled labor and advanced technologies, are growing much
faster than its exports of low-value, labor-intensive items such as
apparel, shoes and plastic products. Consequently, China now accounts
for the entire US$32 billion US trade deficit in advanced-technology
products (ATP). China is also rapidly gaining advantage in more
advanced industries such as autos and aerospace products.

China's entry into the WTO was supposed to provide openings for a
sufficiently rapid growth in US exports to reduce the trade deficit
with China. While the export growth rate has increased since 2001
(from a very small base), the value of those exports has been swamped
by a rapidly rising tide of imports. The WTO is a free-trade and
investment agreement that has provided investors with a unique set of
guarantees designed to stimulate foreign direct investment and the
movement of factories around the world, especially from the US to low-
wage locations such as China and Mexico.

<much more>

[paineinthearse]

1. Senator Dorgan 2/8 floor speech

Will get a transacript tomorrow. Good speech about the impact of offshoring jobs to China & lack of environmental controls.