Analysis: Is the U.S. trading away Minnesota’s jobs?

These agreements make it easier for multinational corporations to produce and sell products globally, moving products and jobs from one country to another in pursuit of a lower price for labor and higher price for products.

The goal is higher profits, but according to JOBS NOW Coalition in St. Paul, there is growing evidence that the US is trading away Minnesota\’s jobs in the process.

Signs are that large corporations are doing well. Corporate profits in the United States increased from $434 billion in 1990 to $819 billion in 2000 to $1.6 trillion in 2010, according to the April 2011 "Survey of Current Business.”

But the effect on Minnesota\’s working economy is another story. Since NAFTA, the North American Free Trade Agreement, took effect in 1994, the U.S. Labor Department has certified that NAFTA has cost Minnesota a net loss of 33,800 jobs.

As U.S. trade with China has grown and the "Made in China" label has become standard in big-box stores like Target and Best Buy, Minnesota has lost still more jobs. According to a recent report from the Economic Policy Institute in Washington D.C., while U.S. trade with China during the decade 2001 through 2010 has brought 12,000 jobs to Minnesota, it has taken away 82,000 jobs, for a trade-related net loss of 70,000 jobs.

The state has filled some of this hole through other job creation, leaving a final net loss of 63,000 jobs for the decade.

"Without NAFTA and our trade with China, we could be in positive numbers for job creation for the past decade" said John Clay, policy director of JOBS NOW. "Instead, we now have to climb our way out of a hole."

Today with three new trade agreements looming, the U.S. International Trade Commission, an independent federal agency which forecasts the economic effects of trade agreements, is predicting that the Korea Free Trade Agreement alone, if approved by Congress, could endanger an additional 57,000 jobs in Minnesota.

The industry likely to be hardest hit is electronics, where the Trade Commission estimates 20,500 high-tech jobs could be shipped overseas if the Korea trade agreement is approved. This would leave Minnesota\’s 80,000 post-secondary-educated job seekers, who are already competing for just 23,000 job openings statewide which require post-secondary education, with still fewer skilled job opportunities.

Other industries, from metal products manufacturing to farming stand to lose as well.

"U.S. agriculture has seen a net trade deficit in seven of the past eight years with countries with whom the U.S. has a trade agreement." noted Doug Peterson of the Minnesota Farmers Union, which, along with the National Farmers Union, is opposing all three new trade agreements.

“Trade deals like Korea, Panama, and Colombia might be good for multinational corporate profits, but they are a wrench in the works for our small and medium-sized businesses,” said Kris Jacobs, executive director of JOBS NOW Coalition. "Loss of jobs and wages reduces consumer spending, and that means less business for everyone."

For more information
Visit the websites of the JOBS NOW Coalition and the Minnesota Fair Trade Coalition.