Research by David Autor, David Dorn, and Gordon Hanson published in January 2016
found (PDF) that competition with China had a much bigger negative impact on U.S. jobs since 2001, when China joined the WTO. Hanson, an economist and trade expert at the University of California, San Diego, says that the steepest decline in manufacturing jobs, which fell from seventeen million to eleven million between 2000 and 2010, is mostly attributable to trade with China and underlying technological changes. “China is at the top of the list in terms of the employment impacts that we found since 2000, with technology second, and NAFTA far less important,” he says.
In fact, says Hanson, NAFTA helped the U.S. auto sector compete with China. By contributing to the development of cross-border supply chains, NAFTA lowered costs, increased productivity, and improved U.S. competitiveness. This meant shedding some jobs in the United States as positions moved to Mexico, he argues, but without the pact, even more would have
otherwise been lost. “Because Mexico is so close, you can have a regional industry cluster where goods can go back and forth. The manufacturing industries in the three countries can be very integrated,” he says. These sort of linkages, which have given U.S. automakers an advantage in relation to China, would be much more difficult without NAFTA’s tariff reductions and protections for intellectual property.
Edward Alden, a senior fellow at the Council on Foreign Relations, says anxiety over trade deals has grown because wages
haven’t kept pace with labor productivity while income inequality has risen. To some extent, he says, trade deals have hastened the pace of these changes in that they have “reinforced the globalization of the American economy.”