Contrary to some claims, only a very small percentage of American jobs are ever put at risk from imports. And surprising to many, U.S. employment has been strong during periods of elevated imports.

According to the Progressive Policy Institute, A Washington, D.C.-based Democratic led think tank, research indicates that at most, imports account for approximately 5 percent of layoffs, and more likely between 2 percent and 3 percent.

According to the Bureau of Labor Statistics payroll data, goods-producing industries (manufacturing, mining, logging and construction) account for 22.4 million workers; service-providing industries account for the remaining 112.6 million workers. The workers not in the manufacturing sector are in industries that by their nature do not produce tradable goods or services, or where imports account for a very small to nonexistent share of domestic supply, according to Daniel Griswold, director of the CATO Institute’s Center for Trade Policy Studies. And in the manufacturing sector, only a small number of workers are in industries considered import-sensitive.

Agricultural workers number 2.2 million and represented approximately 1.5 percent of total U.S. employment, as reported by the U.S. Department of Labor. According to Griswold, some agricultural sectors, such as dairy products, sugar and peanuts are more vulnerable than others—the larger export-oriented sectors such as wheat, corn and soybeans. “Even in farm sectors most vulnerable to import competition,” said Griswold, “the potential job losses are minuscule in relation to the overall U.S. labor force.”

Consumers Benefit Tremendously

Imports offer American consumers greater choices, a wider range of quality and access to lower-cost goods and services. They create competition, forcing domestic producers to improve value by increasing quality and/or by reducing costs. And since imports allow the American family to purchase more goods for less money—stretching the dollar—more disposable income is available for education, health care, mortgages, vacations, etc. Imports also help keep inflation down, which is one of the most important factors in raising our standard of living.

U.S. Industry Is More Competitive

Through the availability of lower-cost imported components and materials, U.S. producers are more competitive. In 2004, more than half the $1.47 trillion in goods Americans imported were capital goods ($344 billion) and industrial supplies and materials ($412 billion). Imports such as petroleum, raw materials and semiconductors are used directly by American producers to lower the cost of their final products. In turn, these products are more attractive, leading to higher sales. And higher sales lead to more jobs.

According to the WTO, “Imports expand the range of final products and services that are made by domestic producers by increasing the range of technologies they can use. When mobile telephone equipment became available, services sprang up even in the countries that did not make the equipment. Additionally, because imports offer unique capabilities at attractive prices, they are proven to enhance worker productivity. And higher productivity leads to a host of benefits.”

This article appeared in Impact Analysis, May-June 2006
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John Manzella
About The Author John Manzella [Full Bio]
John Manzella, founder of the ManzellaReport.com, is a world-recognized speaker, author of several books, and a nationally syndicated columnist on global business, emerging risks and economic trends. His latest book is Global America: Understanding Global and Economic Trends and How To Ensure Competitiveness.




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