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Tariffs Stifle Employment

Not ‘Widely Known’ That Imports Create ‘High-Wage’ US Jobs: Report

Imports sustain an estimated 21.4 million net U.S. jobs, including a “net positive number” of employees in every state, said a Trade Partnership Worldwide report, “Imports Work for American Workers,” commissioned by CTA, the National Retail Federation, the U.S. Chamber of Commerce and six other business and trade associations.

About 81% of the import-created jobs are in service sectors, with the wholesale and retail trade generating the highest number of positions, said the report. Of the goods-producing sectors sustaining an estimated 4 million jobs, only construction generates a net positive of 5.9 million positions, with manufacturing, agriculture and mining all generating net job losses due to imports.

U.S. trade policies pending before Congress and the Biden administration “have the potential to both support and hurt” the 21.4 million jobs that imports sustain, said the report. “Changes that impose new barriers to imports would have a negative impact on import-related jobs, while changes that make it harder to impose those restrictions would preserve jobs.”

Congress “routinely” considers legislation that would modify U.S. trade remedy laws, “principally U.S. antidumping and countervailing duty statutes, typically making it more likely that such duties would be imposed on imports of affected products,” said the report. Recent bills tried to change Sections 201, 232 and 301 trade remedies, “in some cases restricting the President’s authority to impose tariffs on imports using these statutes,” it said. “Changes that make it easier to impose new tariffs on imports of selected products from selected countries (or even specific foreign manufacturers) would have a negative impact on import-related jobs,” it said. “Changes that make it harder to impose duties on imports would preserve those jobs.”

Nearly all the Sections 201, 232 and 301 tariffs imposed under President Donald Trump remain in effect, and President Joe Biden's administration “is in a position to terminate them -- or not,” said the report. “In some instances, the Biden administration has proposed adding new tariffs to those imposed by the Trump administration,” including Section 301 duties on Vietnam for alleged trade infractions on currency and timber, and on Austria, India, Italy, Spain, Turkey and the U.K. for their digital services taxes policies, it said.

Federal Reserve Board economists estimate the Trump tariffs “had a net negative impact on U.S. employment,” and no positive impact “on the U.S. manufacturers that produced goods that competed with the tariffed imports,” said the report. “The tariffs likely cut manufacturing employment by 0.6 percent, or by 769,000 based on 2019 levels,” it said. Keeping the tariffs in effect “maintains that employment loss,” and new tariffs on new imports “would simply expand it,” it said.

Import-related jobs “contribute significant value” to the U.S. economy because they pay well, said the report. The mean annual wage of import-dependent jobs in 2018 was $51,000, including $47,000 in services and $58,500 in goods-producing sectors, it said. Two of every three net import-related jobs pay middle-class wages by Pew Research Center definitions, it said. “Actually, the share is much higher, given anomalies in the way the government collects employment and wage data.”

That imports create “millions of high-wage jobs for U.S. workers” is a fact not “widely known,” said the report. “Although some jobs are lost to import competition (and, more significantly, technological advancement), millions of Americans owe their jobs to imports.”