Trade deficit with China cost 2.8 million U.S. jobs since 2001
The growing trade deficit with China has eliminated or displaced nearly 2.8 million U.S. jobs since 2001, or about 2% of all domestic employment during that period.
Most of those jobs — 1.9 million — were in manufacturing, according to research out this week from the Economic Policy Institute, a left-leaning think tank. The computer and electronic parts industries were particularly hard hit. Apparel, textile fabrics, and motor vehicles and parts have also suffered.
The report showed California is the state that has experienced the most employment losses, losing nearly 455,000 jobs from 2001 to 2010 because of trade with the Asian giant. Runner-up Texas lost nearly 233,000 positions.
The increase in U.S. imports from China is only part of the picture, according to Robert Scott, the institute’s director of trade and manufacturing policy research. China has kept the value of its currency, the yuan, low. That makes American-made goods more expensive for Chinese consumers, hurting U.S. exports.
Fierce competition and cheap labor from abroad has pushed down wages for U.S. workers and reduced their bargaining power, especially among the 70% of the workforce without a four-year college degree. In 2006, for example, a full-time median-wage earner lost $1,400 because of globalization, according to the think tank.
Since China entered the World Trade Organization in 2001, the U.S. trade deficit has boomed to $278 billion in 2010 from $84 billion in 2001.
