Study Credits California With 11% of U.S. Exports in 1988

California manufacturers and farmers produced $34.7 billion, or 11%, of all U.S. exports in 1988, according to a forthcoming report that breaks down trade data by state for the first time.

In 1987, exports originating in California totaled $27.8 billion and generated about 233,000 jobs directly related to the export business, according to the report by the California Department of Commerce. Trade specialists, however, challenged the statistics, saying that they were too conservative.

Employment figures for 1988 are not available yet.

The trade figures were based on reports compiled by the Bureau of Census, which in 1987 required shippers for the first time to file state of origin information on export declaration forms.

“We never before had a good measure of what we produced here for trade,” explained Stephen Levy, senior economist at Center for the Continuing Study of the California Economy in Palo Alto. “We only had port data of what got shipped out of here.”

The port data was based on all goods passing through U.S. Customs at ports and airports in the state. That information did not differentiate place of origin, so it included goods produced outside California but shipped through the state overseas. In 1987, $38.9 billion of goods were shipped through California ports and airports.

“It is true, and perhaps confusing, that the amount of stuff actually made in California is less than what is shipped out of the ports because we ship things out from other states,” Levy said. He cautioned that the new export figures should not be compared to the port figures: “It’s not lower or higher, but a different measure.”

But at least one specialist said Commerce’s reading of the data was too simplistic and understated the volume of goods and jobs generated from California exports.

Jock O’Connell, who runs his own trade and foreign investment consulting firm in Davis, said 30% of 1987’s $253 billion in total U.S. exports did not have a state of origin listed. Either the information was not supplied by shippers because of security restrictions or their forms could not be read.

Had the state “refined its reporting system” on the Census data, according to O’Connell, several billions worth of exports and jobs would have been added. “They’ve missed an opportunity to lay claim to several billion dollars worth of exports,” he said.

T. Anthony Quinn, director of the Commerce Department’s Office of Economic Research, said his office decided to take a conservative approach to the Census data.

Besides the 233,000 jobs directly created by exports, an additional 96,000 people were employed in handling imports. Other jobs indirectly related to trade brought total trade employment to 935,000 in 1987.