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Abstract

In the early 2000s, manufacturing-intensive communities in the United States entered a period of economic upheaval that would reshape their labor markets over the next two decades. China’s dramatic rise as the world’s leading exporter of manufactured goods, abetted by receipt of Permanent Normal Trade Relations from the United States in 2000 and accession to the World Trade Organization in 2001, exerted immense pressure on manufacturing in the United States and many other high-income countries.1 Entire industries—textiles, furniture, and home electronics among them—struggled to compete with surges of low-cost imports. In the United States, the China trade shock accounts for approximately one-quarter of the decline in manufacturing jobs between 2000 and 2007.2 Although the aggregate loss of U.S. manufacturing jobs attributable to China’s changing competitive position in those 7 years—approximately 1.5 million to 2 million manufacturing jobs lost—is modest relative to the overall size of the U.S. labor market, these impacts are highly geographically concentrated, meaning that they loom large in places that specialize in producing the goods in which China rapidly gained global market share.

Citation

Autor, David, David Dorn, and Gordon Hanson. "How the China trade shock impacted U.S. manufacturing workers and labor markets, and the consequences for U.S. politics." Washington Center for Equitable Growth (May 2025): 1-20.