Trade Adjustment: Worker Level Evidence
In the past two decades, China’s manufacturing exports have grown spectacularly, U.S. imports from China have surged, but U.S. exports to China have increased only modestly. Using representative, longitudinal data on individual earnings by employer, we analyze the effect of exposure to import compet...
| Main Authors: | , , , |
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| Format: | Working Paper |
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Cambridge, MA: Department of Economics, Massachusetts Institute of Technology
2013
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| Online Access: | http://hdl.handle.net/1721.1/81820 |
| _version_ | 1826207718467174400 |
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| author | Autor, David Dorn, David Hanson, Gordon H. Song, Jae |
| author_facet | Autor, David Dorn, David Hanson, Gordon H. Song, Jae |
| author_sort | Autor, David |
| collection | MIT |
| description | In the past two decades, China’s manufacturing exports have grown spectacularly, U.S. imports from China have surged, but U.S. exports to China have increased only modestly. Using representative, longitudinal data on individual earnings by employer, we analyze the effect of exposure to import competition on earnings and employment of U.S. workers over 1992 through 2007. Individuals who in 1991 worked in manufacturing industries that experienced high subsequent import growth garner lower cumulative earnings and are at elevated risk of exiting the labor force and obtaining public disability benefits. They spend less time working for their initial employers, less time in their initial two-digit manufacturing industries, and more time working elsewhere in manufacturing and outside of manufacturing. Earnings losses are larger for individuals with low initial wages, low initial tenure, low attachment to the labor force, and those employed at large firms with low wage levels. Import competition also induces substantial job churning among high-wage workers, but they are better able than low-wage workers to move across employers with minimal earnings losses, and are less likely to leave their initial firm during a mass layoff. These findings, which are robust to a large set of worker, firm and industry controls, and various alternative measures of trade exposure, reveal that there are significant worker-level adjustment costs to import shocks, and that adjustment is highly uneven across workers according to their conditions of employment in the pre-shock period. |
| first_indexed | 2024-09-23T13:53:53Z |
| format | Working Paper |
| id | mit-1721.1/81820 |
| institution | Massachusetts Institute of Technology |
| last_indexed | 2024-09-23T13:53:53Z |
| publishDate | 2013 |
| publisher | Cambridge, MA: Department of Economics, Massachusetts Institute of Technology |
| record_format | dspace |
| spelling | mit-1721.1/818202019-04-11T10:41:25Z Trade Adjustment: Worker Level Evidence Autor, David Dorn, David Hanson, Gordon H. Song, Jae Trade Flows, Labor Demand, Earnings, Job Mobility, Social Security Programs In the past two decades, China’s manufacturing exports have grown spectacularly, U.S. imports from China have surged, but U.S. exports to China have increased only modestly. Using representative, longitudinal data on individual earnings by employer, we analyze the effect of exposure to import competition on earnings and employment of U.S. workers over 1992 through 2007. Individuals who in 1991 worked in manufacturing industries that experienced high subsequent import growth garner lower cumulative earnings and are at elevated risk of exiting the labor force and obtaining public disability benefits. They spend less time working for their initial employers, less time in their initial two-digit manufacturing industries, and more time working elsewhere in manufacturing and outside of manufacturing. Earnings losses are larger for individuals with low initial wages, low initial tenure, low attachment to the labor force, and those employed at large firms with low wage levels. Import competition also induces substantial job churning among high-wage workers, but they are better able than low-wage workers to move across employers with minimal earnings losses, and are less likely to leave their initial firm during a mass layoff. These findings, which are robust to a large set of worker, firm and industry controls, and various alternative measures of trade exposure, reveal that there are significant worker-level adjustment costs to import shocks, and that adjustment is highly uneven across workers according to their conditions of employment in the pre-shock period. 2013-10-29T00:04:41Z 2013-10-29T00:04:41Z 2013-06-30 Working Paper http://hdl.handle.net/1721.1/81820 Working paper, Massachusetts Institute of Technology, Dept. of Economics;13-21 application/pdf Cambridge, MA: Department of Economics, Massachusetts Institute of Technology |
| spellingShingle | Trade Flows, Labor Demand, Earnings, Job Mobility, Social Security Programs Autor, David Dorn, David Hanson, Gordon H. Song, Jae Trade Adjustment: Worker Level Evidence |
| title | Trade Adjustment: Worker Level Evidence |
| title_full | Trade Adjustment: Worker Level Evidence |
| title_fullStr | Trade Adjustment: Worker Level Evidence |
| title_full_unstemmed | Trade Adjustment: Worker Level Evidence |
| title_short | Trade Adjustment: Worker Level Evidence |
| title_sort | trade adjustment worker level evidence |
| topic | Trade Flows, Labor Demand, Earnings, Job Mobility, Social Security Programs |
| url | http://hdl.handle.net/1721.1/81820 |
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