China’s WTO membership cost US 3.4 million jobs

The United States has a massive trade deficit with China that has ballooned since the world’s most populous nation joined the World Trade Organization (WTO), costing the American economy millions of jobs, and U.S. workers billions in wages, according to an analysis completed by the Economic Policy Institute (EPI).

A model run by the EPI, a non-partisan think tank that advocates for low-and-middle income workers, examined the impacts of trade by subtracting the job opportunities lost to imports from those gained through exports. While imports from China have soared, exports to China have not increased by a similar magnitude. The result, therefore, is a loss of 3.4 million jobs in the U.S. between 2001- the year China joined the WTO - and 2017. Job losses have been across the country, while the manufacturing sector has been particularly hard hit.  The EPI estimates that 2.5 million manufacturing jobs were lost between 2001 and 2017, about 75 percent of the total losses.

While the jobs losses have been in all 50 states, the five hardest-hit states when looking at job losses as a share of total employment were, New Hampshire, Oregon, California, Minnesota and North Carolina.

Growing trade deficits are also associated with wage losses for employees in all sectors of the economy who don’t have a college degree. According to the EPI, between 2001 and 2011, growing trade deficits with China reduced the incomes of directly impacted workers by $37 billion per year, and in 2011 alone, growing competition with imports from China and other low wage-countries reduced the wages of all U.S. non–college graduates by a total of $180 billion. The study noted that most of the income was redistributed to corporations in the form of higher profits and to workers with college degrees.