The United States' China Trade Balance has had a marked impact on the US economy resulting into job losses that reach into the most technologically advanced industries in the manufacturing sector. They also affect every state says the report prepared by the U.S.-China Economic and Security Review Commission (USCC).
Washington-based Economic Policy Institute (EPI), a nonprofit, nongovernmental research organization focuses on the economic conditions of lower and middle-income American workers. To asess impact of China Trade Balance Robert Scott, director of international programs prepared the study, "U.S.-China Trade, 1989-2003," for the commission.
In China Trade Balance, adopting a methodology that determines the number of jobs needed to produce exports and imports, the EPI study found that 1.5 million jobs were lost to lower-wage Chinese competition in the 14-year period between 1989 and 2003. The U.S. trade deficit with China rose twenty-fold, from $6.2 billion to $124 billion during the same period. It is expected to increase another 20 percent in 2004, to $150 billion.
( The deficit has since grown to $ 202 billion annually and continues to increase).
In China Trade Balance, the study noted that the job loss rate more than doubled since China entered the World Trade Organization (WTO) in 2001, and that China's exports to the United States of sophisticated electronics and communications equipment requiring skilled labor were growing faster than the exports of low-value, labor-intensive products. The deficit impacts ever expanding segment of US manufacturing, including advanced technology industries like semiconductors once thought immune to lower wage Chinese competition.
In Chinese Trade Balance, China's exports to the United States of computers, electronics and communications equipment, along with other high end products using more highly skilled labor and advanced technologies grew much more than exports of low-value, labor-intensive items such as apparel, shoes and plastic products.
In China Trade Balance, "The assumptions we built our trade relationship with China on have proven to be a house of cards," Scott said. "Everyone knew we would lose jobs in labor-intensive industries like textiles and apparel, but we thought we could hold our own in the capital-intensive, high-tech arena. The numbers we're seeing now put the lie to that hope -- as China expands its share even in core industries such as autos and aerospace."
In US China Trade Balance, the US trade deficit in Advanced Technology Products (ATP) with China touched $32 billion, equal to the total US ATP deficit.
Scott's research found that over the course of 14 years the 1.5 million lost jobs were distributed across all 50 U.S. states and the District of Columbia, with overall employment losses of roughly 1.5 to 2.5 percent in the hardest-hit states.
For more on China trade log onto chinatradinghub.com.
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