Everybody Knows, Part 2

There is considerable risk of this becoming an ongoing and long running series…

In the first installation, we looked at prosperity and political affiliation.  This time we’ll look at international trade and employment, where Everyone Knows those furriners took our jobs…

Via the good offices of Stephen VodkaPundit Green writing at Instapundit:

BY THE NUMBERS: China (or Mexico) probably didn’t take your job.

At the high water mark in 1999, import competition was responsible for 2.3 percent of total annual job separations. In 2011, the last year of available data, only 0.1 percent of total separations were due to import competition. As a comparison, government regulation accounted for 1,500 separations (0.1 percent) and the end of seasonal work accounted for 393,000 (35.3 percent) in 2011.

Critics also worry that globalization incentivizes American companies to move overseas. This issue has been raised repeatedly during the election season. Donald Trump has repeatedly condemned U.S. firms like Ford and Carrier for opening production facilities in Mexico, while Hilary Clinton has criticized Trump for offshoring the production of his suits and ties. However, similar to import competition, offshoring does not have a large effect on overall job displacement.

Data in the above table was also taken from BLS’s Extended Mass Layoff Reports. Because BLS stopped collecting information on overseas job relocations in 2004, data is only available until 2003. However, the pattern is clear: overseas relocation is not a giant job killer. Even in the aftermath of NAFTA, which took effect in 1994, offshoring never displaced more than 20,000 workers annually. Furthermore, it only triggers around 1 percent of annual job separations.

Lots of data to soak up from Jacqueline Varas at the American Action Forum, although I’d have more confidence in the numbers if BLS hadn’t stopped collecting overseas relocations in 2004.

…it just ain’t so.

Join the chorus.

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  • Tom Monroe

    I doubt that the numbers being posted by the BLS are reliable. I suspect these are businesses self-reporting, and probably for a variety of reasons, businesses are gaming the system and claiming they are not outsourcing, when it fact, they are.
    I am only familiar with Microsoft – but I would guess that others are doing the same thing. I was an FTE there from 2007 to when I was laid off in 2010.
    I was part of a group of “Stealth Layoffs”. Stealth layoffs are done in small numbers to avoid certain requirements the government makes of businesses that do large layoffs (so instead of getting zinged because they laid off 2% of their staff one day, they lay off each week until they get to the 2% number).
    While Microsoft lays off employees, they bring in large numbers of H1B visas, and hire overseas contract workers. And I have been in conference calls with these contractors, and I’ve seen how they’ll have 3 or 4 workers in the remote site all working as one “contractor” (I have seen this happen numerous times). So in fact, jobs which are done by Americans are being taken by foreigners – and from what I’ve seen, the BLS is probably clueless about it. These foreign workers are happy to quadruple up on technical projects, because even making a fraction of US minimum wage, they are earning what is the equivalent of a huge salary in their home countries. When Microsoft lays off people with 10+ years of experience there, it’s not a matter of not being able to find qualified workers – it is a matter of getting the most done for the least money (and when companies game minimum wage laws, American workers get screwed).

    • Feel free to present your data.

      • Tom Monroe
        • One employer in one industry.

          • Tom Monroe

            Robert, this is a large and complex issue, and I would expect that it would require in depth and nuanced research to completely understand it. Since I personally was laid off, *and* I’ve known many people who were laid off at Microsoft, I can speak personally to it (and the information to back up my assertion took me all of maybe 5 minutes to locate). Microsoft is a large company – hardly some small insignificant player as you are implying.
            I was very careful in my original post to state that I was talking about one employer (albeit, a large one). Would you really expect other large companies to act differently?

          • Who is Robert?

          • Tom Monroe

            Sorry – I meant Rodney

          • The article linked above covers a wide range of industries and employers over a period of years. I too work in the tech industry (IoT), and have worked in other subsets of the tech industry. Talent is hard to find here in Silicon Valley at the moment.

          • Tom Monroe

            If labor is hard to find, then employers should be paying a premium for it. They won’t pay the premium, which is why they bring in foreign labor. Of course, I’ve never had a problem finding a job… but I haven’t seen 10-15% pay increases year after year since the early 2000s – although I have to invest more and more money in my career (since technology changes all the time) year after year. I think crap like what Microsoft does is driving down labor rates.

          • They are, here.

          • Tom Monroe

            Seems like even Silicon valley companies are laying off. I wonder how many of these companies are lobbying to get the H1B visa cap raised, while they lay off employees?

          • Creative destruction can indeed be uncomfortable.

          • Then again…

            Drudge says we’ve surpassed the DOT COM boom.

          • Tom Monroe

            nice .jpg file. link not so much.

  • Retired military

    Under the subject of everybody knows.
    Apparently the State Dept has admitted the $400 million payment was ransom for their US prisoners. Gee after lying about it for weeks they state the blatantly obvious. Who’da thunk it.

    • You might want to go to this post to talk about that.

      • Retired military

        I posted before that thread was up.