According to a study released on September 20, 2011 by the Economic Policy Institute, the U.S.-China trade deficit has eliminated or displaced nearly 2.8 million jobs, of which 1.9 million or 70 percent were in manufacturing.<\/p>\n
The study<\/a>, \u201cGrowing U.S. trade deficit with China cost 2.8 million jobs between 2001 and 2010\u201d by Robert Scott, EPI\u2019s director of trade and manufacturing policy research, writes, \u201cSince China entered the World Trade Organization in 2001, the extraordinary growth of U. S. trade has had a dramatic effect on U.S. workers and the domestic economy.\u201d<\/p>\n The trade deficit with China grew from $84 billion in 2001, when China entered the WTO, to $278 billion in 2010. \u00a0It eliminated or displaced 2,790,100 jobs, or about 2 percent of total U.S. employment over that period.\u00a0All 50 states, the District of Columbia and Puerto Rico suffered jobs lost or displaced as a result of the growing U.S.-China trade deficit.\u00a0 The 10 states that suffered the biggest net losses were California (454,600 jobs), Texas (232,800), New York (161,400), Illinois (118,200), Florida (114,400), North Carolina (107,800), Pennsylvania (106,900), Ohio (103,500), Massachusetts (88,600) and Georgia (87,700). ). \u00a0These losses comprise more than 2.2 percent of total employment.<\/p>\n A total of 453,100 jobs were lost or displaced from 2008 to 2010 alone\u2014even though imports from China and the rest of world collapsed in 2009 during the height of the global financial crisis. \u00a0In fact, the report notes the U.S. trade deficit with China increased $8 billion during the great recession, despite a collapse in world trade at that time.<\/p>\n The largest share of manufacturing jobs lost or displaced were in computer and electronic parts, accounting for more than 44 percent of the $194 billion increase in the U. S. trade deficit with China between 2001 and 2010.\u00a0 In 2010, the total U.S. trade deficit with China was $278.3 billion, of which $124.3 billion was in computer and electronics parts.\u00a0 This growth of the trade deficit resulted in the loss of 909,400 jobs in these industries.<\/p>\n Apparel and accessories lost 178, 700 jobs, textile fabrics and products lost 92,300 jobs, fabricated metal products lost 123,900 jobs, plastic and rubber products lost 62,000 jobs, motor vehicles and parts lost 49,300 jobs, and miscellaneous manufactured goods lost 119,700 jobs.\u00a0\u00a0 The job displacement estimates in the report are conservative and represent only the direct and indirect jobs displaced by trade and exclude jobs in domestic wholesale and retail trade and advertising.<\/p>\n \u201cGlobal trade in advanced technology products\u2014often discussed as a source of comparative advantage for the United States\u2014is instead dominated by China,\u201d the report concludes. \u00a0The U.S. had a new record $94.2 billion trade deficit in Advanced Technology Products (ATP)\u00a0with China in 2010 compared to a $40.7 billion trade deficit in 2007, an increase of 45.5 percent in three years.\u00a0 In contrast, the United States had a $13.3 billion surplus in ATP with the rest of the world in 2010.<\/p>\n The impact of the trade deficit with China extends beyond U.S. jobs lost or displaced, according to the Alliance for American Manufacturing (AAM<\/a>). Competition with China and countries like it has resulted in lower wages and less bargaining power for U.S. workers in manufacturing and for all workers with less than a four-year college degree.<\/p>\n Cheap labor may well be the main reason for China\u2019s manufacturing advantage, but the report cites illegal currency manipulation as a major cause of the rapidly growing U.S. trade deficit with China. \u00a0Unlike other currencies, the Chinese yuan does not fluctuate freely against the dollar, but is artificially pegged in order to boost China\u2019s exports. \u00a0While the cost of labor affected China\u2019s exports, the currency manipulation, which happened despite China joining the World Trade Organization in 2001, distorted its imports.<\/p>\n American policymakers have long assumed that as China\u2019s huge middle class grew, U.S. companies\u2019 sales to these new consumers would also grow. \u00a0But it did not work out that way, the EPI reports: \u201cas a result of China\u2019s currency manipulation and other trade distorting practices, including extensive subsidies, legal and illegal barriers to imports, dumping and suppression of wages and labor rights, the envisioned flow of U.S. exports to China did not occur.\u201d \u00a0Added to its labor cost advantage, this currency manipulation has been devastating to many U.S. companies.<\/p>\n China\u2019s currency manipulation, state-owned enterprises, heavy industrial subsidies, intellectual property theft and piracy, indigenous innovation policies, rare earth mineral export restrictions and other trade-distorting practices have caused China\u2019s share of the total U.S. non-oil goods trade deficit to soar from 69.6 percent in 2008 to 78.3 percent in 2010.<\/p>\n \u201cUnless China raises the real value of the yuan by at least 28.5 percent and eliminates other trade distortions,\u201d the report concludes, \u201cthe U.S. trade deficit and job losses will continue to grow rapidly.\u201d<\/p>\n \u201cThis report offers conclusive evidence that immediate action by the Administration is needed to curb China\u2019s currency manipulation, which, along with China\u2019s blatant trade violations, are having the same devastating impact on high-tech production that they\u2019ve already had on the nation\u2019s longstanding industrial base,\u201d said Scott Paul<\/a>, executive director of the Alliance for American Manufacturing (AAM), a partnership of America\u2019s leading manufacturers and the United Steelworkers union.<\/p>\n \u201cWe urgently need a national strategy for restoring America\u2019s global leadership in manufacturing,\u201d he added. \u201cChallenging China\u2019s currency manipulation would be an important first step toward developing such a strategy.\u00a0 It would not only cut unemployment, it would result in a much-needed increase in federal revenue.\u201d<\/p>\n According to a blog notice by the Coalition for a Prosperous America<\/a> today, Majority Leader Reid has filed for cloture on the Senate currency bill that was filed last week.\u00a0 This bill is the Brown-Schumer-Graham-Snowe-Stabenow-Sessions-Casey-Burr Currency Exchange Rate Oversight Act of 2011 (S. 1619)<\/a>, which is the consensus bill negotiated among Senators to deal with Treasury\u2019s oversight role as well as the Commerce Department\u2019s role in countervailing duty investigations.\u00a0 Reid’s announcement means that there will be vote on the cloture on Monday, October 3, 2011, followed by debate on the currency bill and a vote on the bill.\u00a0 A similar bill, H.R.639, was introduced recently in the House and had 206 co-sponsors as of last week.<\/p>\n The EPI report cites Foreign Direct Investment (FDI) as another key factor in the job loss.\u00a0 FDI is money invested in China by other countries, such as the United States.\u00a0 It can take the form of American companies buying or building plants in China to move manufacturing operations to China.\u00a0 When outsourcing to China first occurred in the mid 1990s, American companies just outsourced parts and assemblies to Chinese companies.\u00a0 \u00a0Then, it became the trend to outsource whole product lines to Chinese companies.\u00a0 The next step was for American companies to buy or build new plants set up as subsidiaries in China to manufacture their products. \u00a0The report states that \u201cChina is the largest recipient of FDI of all developing countries and is the third largest recipient of FDI over the past three decades, trailing only the United Stated and the United Kingdom.\u00a0 Foreign-invested enterprises (both joint ventures and wholly owned subsidiaries) were responsible for 55 percent of China\u2019s exports and 68 percent of its trade surplus in 2010.\u00a0 Outsourcing ? through foreign direct investment in factories that make goods for export to the United States ? has played a key role in the shift of manufacturing production and jobs from the Unites States to China since it entered the WTO in 2001.\u201d<\/p>\n The EPI research does not make a forecast of how many more American jobs may be lost in the future due to China\u2019s manufacturing cost advantages and questionable trade policies. \u00a0The damage, of course, did not suddenly end in 2010, and is almost certainly ongoing. \u00a0And, of course, \u201cthe U.S. is piling up foreign debt, losing export capacity, and faces a fragile macroeconomic environment.\u201d<\/p>\n The report concludes that \u201cthe U. S. trade relationship needs a fundamental change.\u00a0 Addressing the exchange rate policies and labor standards issue in the Chinese economy are important first steps.\u201d<\/p>\n I think it\u2019s high time that these issues are addressed by Congress.\u00a0 I\u2019ve watched one company after another outsource manufacturing to China in my sales territory in Southern California as a manufacturers\u2019 sales rep for American companies.\u00a0 I\u2019ve personally witnessed my customers who are engineers and purchasing agents at these companies lose their jobs and have increasing difficulty finding replacement jobs. My career in manufacturing includes the major recessions we have experienced since 1980, and I have never known so many people out of work for so long. \u00a0The joblessness problem in the U.S. is so serious that any added erosion of employment opportunities from our trade deficits with China will make a recovery of the American economy all the more difficult.<\/p>\n According to a study released on September 20, 2011 by the Economic Policy Institute, the U.S.-China trade deficit has eliminated or displaced nearly 2.8 million jobs, of which 1.9 million or 70 percent were in manufacturing.<\/p>\n The study<\/a>, \u201cGrowing U.S. trade deficit with China cost 2.8 million jobs between 2001 and 2010\u201d by Robert Scott, EPI\u2019s director of trade and manufacturing policy research, writes, \u201cSince China entered the World Trade Organization in 2001, the extraordinary growth of U. S. trade has had a dramatic effect on U.S. workers and the domestic economy.\u201d<\/p>\n The trade deficit with China grew from $84 billion in 2001, when China entered the WTO, to $278 billion in 2010. \u00a0It eliminated or displaced 2,790,100 jobs, or about 2 percent of total U.S. employment over that period.\u00a0All 50 states, the District of Columbia and Puerto Rico suffered jobs lost or displaced as a result of the growing U.S.-China trade deficit.\u00a0 The 10 states that suffered the biggest net losses were California (454,600 jobs), Texas (232,800), New York (161,400), Illinois (118,200), Florida (114,400), North Carolina (107,800), Pennsylvania (106,900), Ohio (103,500), Massachusetts (88,600) and Georgia (87,700). ). \u00a0These losses comprise more than 2.2 percent of total employment.<\/p>\n A total of 453,100 jobs were lost or displaced from 2008 to 2010 alone\u2014even though imports from China and the rest of world collapsed in 2009 during the height of the global financial crisis. \u00a0In fact, the report notes the U.S. trade deficit with China increased $8 billion during the great recession, despite a collapse in world trade at that time.<\/p>\n The largest share of manufacturing jobs lost or displaced were in computer and electronic parts, accounting for more than 44 percent of the $194 billion increase in the U. S. trade deficit with China between 2001 and 2010.\u00a0 In 2010, the total U.S. trade deficit with China was $278.3 billion, of which $124.3 billion was in computer and electronics parts.\u00a0 This growth of the trade deficit resulted in the loss of 909,400 jobs in these industries.<\/p>\n Apparel and accessories lost 178, 700 jobs, textile fabrics and products lost 92,300 jobs, fabricated metal products lost 123,900 jobs, plastic and rubber products lost 62,000 jobs, motor vehicles and parts lost 49,300 jobs, and miscellaneous manufactured goods lost 119,700 jobs.\u00a0\u00a0 The job displacement estimates in the report are conservative and represent only the direct and indirect jobs displaced by trade and exclude jobs in domestic wholesale and retail trade and advertising.<\/p>\n \u201cGlobal trade in advanced technology products\u2014often discussed as a source of comparative advantage for the United States\u2014is instead dominated by China,\u201d the report concludes. \u00a0The U.S. had a new record $94.2 billion trade deficit in Advanced Technology Products (ATP)\u00a0with China in 2010 compared to a $40.7 billion trade deficit in 2007, an increase of 45.5 percent in three years.\u00a0 In contrast, the United States had a $13.3 billion surplus in ATP with the rest of the world in 2010.<\/p>\n The impact of the trade deficit with China extends beyond U.S. jobs lost or displaced, according to the Alliance for American Manufacturing (AAM<\/a>). Competition with China and countries like it has resulted in lower wages and less bargaining power for U.S. workers in manufacturing and for all workers with less than a four-year college degree.<\/p>\n Cheap labor may well be the main reason for China\u2019s manufacturing advantage, but the report cites illegal currency manipulation as a major cause of the rapidly growing U.S. trade deficit with China. \u00a0Unlike other currencies, the Chinese yuan does not fluctuate freely against the dollar, but is artificially pegged in order to boost China\u2019s exports. \u00a0While the cost of labor affected China\u2019s exports, the currency manipulation, which happened despite China joining the World Trade Organization in 2001, distorted its imports.<\/p>\n American policymakers have long assumed that as China\u2019s huge middle class grew, U.S. companies\u2019 sales to these new consumers would also grow. \u00a0But it did not work out that way, the EPI reports: \u201cas a result of China\u2019s currency manipulation and other trade distorting practices, including extensive subsidies, legal and illegal barriers to imports, dumping and suppression of wages and labor rights, the envisioned flow of U.S. exports to China did not occur.\u201d \u00a0Added to its labor cost advantage, this currency manipulation has been devastating to many U.S. companies.<\/p>\n China\u2019s currency manipulation, state-owned enterprises, heavy industrial subsidies, intellectual property theft and piracy, indigenous innovation policies, rare earth mineral export restrictions and other trade-distorting practices have caused China\u2019s share of the total U.S. non-oil goods trade deficit to soar from 69.6 percent in 2008 to 78.3 percent in 2010.<\/p>\n \u201cUnless China raises the real value of the yuan by at least 28.5 percent and eliminates other trade distortions,\u201d the report concludes, \u201cthe U.S. trade deficit and job losses will continue to grow rapidly.\u201d<\/p>\n \u201cThis report offers conclusive evidence that immediate action by the Administration is needed to curb China\u2019s currency manipulation, which, along with China\u2019s blatant trade violations, are having the same devastating impact on high-tech production that they\u2019ve already had on the nation\u2019s longstanding industrial base,\u201d said Scott Paul<\/a>, executive director of the Alliance for American Manufacturing (AAM), a partnership of America\u2019s leading manufacturers and the United Steelworkers union.<\/p>\n \u201cWe urgently need a national strategy for restoring America\u2019s global leadership in manufacturing,\u201d he added. \u201cChallenging China\u2019s currency manipulation would be an important first step toward developing such a strategy.\u00a0 It would not only cut unemployment, it would result in a much-needed increase in federal revenue.\u201d<\/p>\n According to a blog notice by the Coalition for a Prosperous America<\/a> today, Majority Leader Reid has filed for cloture on the Senate currency bill that was filed last week.\u00a0 This bill is the Brown-Schumer-Graham-Snowe-Stabenow-Sessions-Casey-Burr Currency Exchange Rate Oversight Act of 2011 (S. 1619)<\/strong><\/a>, which is the consensus bill negotiated among Senators to deal with Treasury\u2019s oversight role as well as the Commerce Department\u2019s role in countervailing duty investigations.\u00a0 Reid’s announcement means that there will be vote on the cloture on Monday, October 3, 2011, followed by debate on the currency bill and a vote on the bill.\u00a0 A similar bill, H.R.639, was introduced recently in the House and had 206 co-sponsors as of last week.<\/p>\n The EPI report cites Foreign Direct Investment (FDI) as another key factor in the job loss.\u00a0 FDI is money invested in China by other countries, such as the United States.\u00a0 It can take the form of American companies buying or building plants in China to move manufacturing operations to China.\u00a0 When outsourcing to China first occurred in the mid 1990s, American companies just outsourced parts and assemblies to Chinese companies.\u00a0 \u00a0Then, it became the trend to outsource whole product lines to Chinese companies.\u00a0 The next step was for American companies to buy or build new plants set up as subsidiaries in China to manufacture their products. \u00a0The report states that \u201cChina is the largest recipient of FDI of all developing countries and is the third largest recipient of FDI over the past three decades, trailing only the United Stated and the United Kingdom.\u00a0 Foreign-invested enterprises (both joint ventures and wholly owned subsidiaries) were responsible for 55 percent of China\u2019s exports and 68 percent of its trade surplus in 2010.\u00a0 Outsourcing ? through foreign direct investment in factories that make goods for export to the United States ? has played a key role in the shift of manufacturing production and jobs from the Unites States to China since it entered the WTO in 2001.\u201d<\/p>\n The EPI research does not make a forecast of how many more American jobs may be lost in the future due to China\u2019s manufacturing cost advantages and questionable trade policies. \u00a0The damage, of course, did not suddenly end in 2010, and is almost certainly ongoing. \u00a0And, of course, \u201cthe U.S. is piling up foreign debt, losing export capacity, and faces a fragile macroeconomic environment.\u201d<\/p>\n The report concludes that \u201cthe U. S. trade relationship needs a fundamental change.\u00a0 Addressing the exchange rate policies and labor standards issue in the Chinese economy are important first steps.\u201d<\/p>\n I think it\u2019s high time that these issues are addressed by Congress.\u00a0 I\u2019ve watched one company after another outsource manufacturing to China in my sales territory in Southern California as a manufacturers\u2019 sales rep for American companies.\u00a0 I\u2019ve personally witnessed my customers who are engineers and purchasing agents at these companies lose their jobs and have increasing difficulty finding replacement jobs. My career in manufacturing includes the major recessions we have experienced since 1980, and I have never known so many people out of work for so long. \u00a0The joblessness problem in the U.S. is so serious that any added erosion of employment opportunities from our trade deficits with China will make a recovery of the American economy all the more difficult.<\/p>\n <\/p>\n <\/p>\n <\/p>\n <\/p>\n <\/p>\n <\/p>\n","protected":false},"excerpt":{"rendered":" According to a study released on September 20, 2011 by the Economic Policy Institute, the U.S.-China trade deficit has eliminated or displaced nearly 2.8 million jobs, of which 1.9 million or 70 percent were in manufacturing. The study, \u201cGrowing U.S. trade deficit with China cost 2.8 million jobs between 2001 and 2010\u201d by Robert Scott, […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3,4],"tags":[],"class_list":["post-238","post","type-post","status-publish","format-standard","hentry","category-outsourcing","category-tradepolicy"],"_links":{"self":[{"href":"https:\/\/savingusmanufacturing.com\/blog\/wp-json\/wp\/v2\/posts\/238","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/savingusmanufacturing.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/savingusmanufacturing.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/savingusmanufacturing.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/savingusmanufacturing.com\/blog\/wp-json\/wp\/v2\/comments?post=238"}],"version-history":[{"count":1,"href":"https:\/\/savingusmanufacturing.com\/blog\/wp-json\/wp\/v2\/posts\/238\/revisions"}],"predecessor-version":[{"id":239,"href":"https:\/\/savingusmanufacturing.com\/blog\/wp-json\/wp\/v2\/posts\/238\/revisions\/239"}],"wp:attachment":[{"href":"https:\/\/savingusmanufacturing.com\/blog\/wp-json\/wp\/v2\/media?parent=238"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/savingusmanufacturing.com\/blog\/wp-json\/wp\/v2\/categories?post=238"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/savingusmanufacturing.com\/blog\/wp-json\/wp\/v2\/tags?post=238"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}