Is China really stealing US jobs?

63559

The accusation has been repeated many times such that many people have come to believe it as the gospel. From politicians to economists to laymen, many have come to believe that China is stealing US jobs in its quest to build its economy. This assertion has further been fueled by rapid shift of American companies of their manufacturing operations, more especially assembly from the US to China.  As a matter of fact, Donald Trump is one of the leading figures that has repeated this accusation over and over during his campaigns needless to mention that almost all the US presidential contenders seemed to agree on this. However, from a rational perspective one may ask, Is China really stealing US jobs? As this notion gain a striking embracement amongst the struggling Americans, it is important to objectively explore the issue.

The Corporate America has often asked the question, “Why pay someone in New York, a staggering wage when someone in Mexico or China will make do with slave wage?” bearing this in mind, it becomes difficult to discern whether it is American policies that are pushing jobs away or it is China that as placed measures to attract American industries and hence would be American jobs to China. Isn’t this the role of any government, that is, to attract investments and hence employment opportunities to its population. Abstractly, going by this perspective, it is American policies that have pushed industries towards other nations and as such, pushed jobs away.

Further, contrary to the widely held perception that American jobs are on the decline and Chinese jobs on the rise, this is all rhetoric, US manufacturing jobs are rising, a majority of which are originating from new job offers from country returning from China due to its struggling ability to keep pace with its saturating manufacturing capacity. As a matter of fact, since 2010, over one million factory jobs have been created in the US, most of which are well paying jobs with average hourly rates increasing by over 10%. It is no surprise that the Purchasing Managers’ Index have reported a steadily expanding job market in the US. In sharp contrast, Quanton data that tracks global jobs reported a drop in China’s manufacturing positions since 2012 by nearly 6%. This finding is reinforced by the country’s Ministry of Commerce report that stated that factory activity in China has been contracting over the last 3 years with foreign direct investment flattening. This paints an entirely different image from one where China is stealing US jobs.

However, the assertions made in this article should not be misconstrued to imply that America never lost jobs to China. Indeed, the US lost thousands of jobs to China but thanks to the reshoring initiative, the trend has changed. Today, if statistics are anything to go by, manufacturing companies have started trooping back to the US and in turn bring back a vast portion of the jobs that had been lost to China. Even as politicians continue to bash China for stealing US jobs, the realities no doubt suggest otherwise. At one point, the US, thanks to its poor policies lost jobs to not just China but many other destinations such as Mexico. The trend has however changed and the reality substantially differs from what politicians tell the back in a bid to win votes.

Prev postNext post