A new report commissioned by HSBC Bank says the United States could create 10 million new high-paying trade-connected jobs over the next decade if it pursues a comprehensive pro-trade policy agenda.
Despite the U.S. having entered its 64th month of recovery from the depth of the Great Recession and unemployment falling to just 5.9 percent, the jobs regained have, as a whole, been lower paying than the ones lost – on average 23 percent less, according to a study earlier this year by the U.S. Conference of Mayors.
Authored by Matthew Slaughter, professor and associate dean at the Tuck School of Business at Dartmouth, the report, entitled How America Is Made For Trade, explains why high-wage jobs are often those connected to the world through international trade and investment. Slaughter points out that research has long documented that workers at globally engaged companies tend to earn more than workers at purely domestic companies: about 15%-20% more in companies that export or import, and about 25%-30% more in multinationals.
“Because trade encompasses a dynamic mix of products, customers, and production methods, America needs a similarly dynamic policy agenda to create more good jobs connected to trade,” Slaughter says.
Some of the key highlights that demonstrate the impact U.S. exports have had on the economy include:
- The typical U.S. multinational relies on small business suppliers for more than 24% of their total input purchases.
- U.S. exports have more than doubled in the past year.
- Companies that employ 500 workers or fewer accounted for over 97.7% of total US exports in 2012, and this number is steadily rising.
To open new markets and extend supply chains, the report urges U.S. lawmakers to liberalize trade and investment through ambitious new free trade deals like the Trans-Pacific Partnership and the Trans-Atlantic Trade and Investment Partnership. Additionally, it recommends that government should expand and streamline high-skilled immigration in order to broaden the country’s business ties abroad and suggests it would attract more investment from global companies by overhauling America’s ostensibly high-rate and notoriously complex corporate tax code.
Click here to download the report.