American consumers, businesses benefit from Chinese imports: WSJ

WASHINGTON, May 29 (Xinhua) -- Treating the "China shock" as a verdict on American national employment is a mistake, according to a recent commentary published in The Wall Street Journal (WSJ).

The article highlights recent research from the National Bureau of Economic Research, which finds that local job losses were largely balanced by job gains in other regions.

For example, while manufacturing-heavy regions in the Midwest and South experienced employment declines, coastal and high-tech hubs such as the West Coast and Northeast saw a rise in service-sector jobs.

By analyzing supply chains, researchers have found that the so-called "China shock" slightly increased total U.S. employment from 2000 to 2007 and cheaper imports lowered costs for businesses and consumers, which in turn fueled demand and employment growth in other sectors. When accounting for these broader economic impacts, data show regions exposed to Chinese trade experienced an average 1.27 percent increase in net employment coupled with rising wages.

Another study cited in the commentary showed that a 1 percentage point increase in imports from China led to an approximately 1.9 percent drop in U.S. consumer prices. Moreover, for every American factory job lost to Chinese competition, consumers collectively gained an estimated 411,000 U.S. dollars in consumer welfare.

U.S. businesses also reaped benefits, the article noted, manufacturers that depend on imported parts or materials from China gained a cost advantage through cheaper inputs, strengthening their global competitiveness.