There is a widespread perception that caused trade with China increased unemployment in America. This is incorrect. Input from China has reduced jobs in some industries, but this had no effect on the total unemployment rate, because more jobs were generated in other industries.
Last year the Chinese trade surplus rose to almost one trillion dollar. If the mercantilists were correct, China should experience a flowering in the production of employment. In fact, it is the opposite that occurs – there are overglons of production paths and the unemployment rate of China is higher than ours.
The Financial times Reports that jobs are lost in a wide range of production industry:
The FT points out that although some jobs have been migrated to other East Asian countries, the main problem is automation:
However, production is far from death in China. In a factory in Panyu on the edge of Guangzhou, people in synchronization work with machines to eliminate new electric vehicles every 53 seconds. . . .
But in parts of the line – such as when seven robots lift, rotate and fit on windows on chassis that pass a conveyor belt – people are enormously in the minority through machines.
Other tasks, such as the dangerous welding and the coating of car doors, are fully automated, while the total automation percentage of the final assembly process is approximately 40 percent.
That is because of design, says Li Xiaoyu, an engineer: the factory has a goal to reduce its human workforce by 10 percent per year.
Automation was also the primary cause of job losses in American production. Unfortunately, politicians have blamed the job losses and this has contributed to the global rise in nationalism. If the trade were really the problem, the large trade surplus of China would generate a lot on production paths. Instead, they have lost more than 7 million of such jobs, just since 2011:
Analysis of 12 labor-intensive production industries between 2011 and 2019 by academics at Changzhou University, Yancheng Teachers University and Henan University, discovered that the average employment in the course of 2011 and 2019 crowns around 14 percent or almost 4 million rolls.
An FT analysis of the same 12 sectors between 2019 and 2023 found a further decrease of 3.4 mn jobs.