US exports and employment

Abstract

We examine the employment responses to import competition from China and to global export expansion from the United States, both of which have been expanding strongly during the past decades. We find that although Chinese imports reduce jobs, at both the industry level and the local commuting zone level, the global export expansion of US products also creates a considerable number of jobs. On balance over the entire 1991-2007 period, job gains due to changes in US global exports were slightly less than job losses due to Chinese imports. Using data at both the industry level and the commuting zone level, we find a net loss of around 0.2-0.3 million jobs. When we extend the analysis to 1991-2011, we find the net job effect of import and export exposure is roughly balanced at the commuting zone level.

Re-examining the Effects of Trading with China on Local Labor Markets: A Supply Chain Perspective

“…They do not examine the employment effect of exporting to China alone, nor the employment effect of net imports from China across commuting zones. In a robustness check, Feenstra, Ma, and Xu (2017) estimate the employment effects of downstream and upstream channels and find no significant effects. However, their measures of the two channels have the same two limitations that we have explained about the Acemoglu et al (2016) method.…”

“…12 Feenstra, Ma, and Xu (2017) and Feenstra and Sasahara (2017) examine the employment effect of total US exports, and show that it partially offsets a negative employment effect from importing from China through a direct competition channel. They do not examine the employment effect of exporting to China alone, nor the employment effect of net imports from China across commuting zones.…”

International trade regulation and job creation

“…The adverse employment effects of the China shock were concentrated in manufacturing sectors and in the regions where manufacturing firms locate, were long-lasting and did not dissipate nationally through the reallocation of displaced workers. In aggregate, however, the jobs created by the concomitant expansion of exports to both China and the rest of the world, in sectors not exposed to import competition, more than offset the reduction in manufacturing jobs [5].…”

“…US imports from China caused job losses in tradable sectors exposed to import competition. These losses, however, were largely offset by US exports to the rest of the world, which created jobs in non-exposed and non-tradable sectors [5]. This latter result can be explained by the increasing number of non-manufacturing jobs in (former) manufacturing firms, driven by high-skill service professions such as design and engineering, or by increased marketing or other management services replacing the physical manipulation of material inputs.…”

“…Version 2 includes analysis of the China shock and trade liberalization episodes in middle-income countries, providing new evidence on job trajectories of displaced workers and sectoral reallocation. New "Key references" are [4], [5], [6], [7], [8], [14].…”