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LOCAL Commentary :: Economy : Globalization : Labor
Globalization, Employment, and Wages
September 6, the Coalition against Global Exploitation with the Student Labor Action Committee held a teach-in on the Free Trade Area of the Americas and the World Trade Organization in conjunction with upcoming protests in Cancun, Mexico and Miami, Florida. Contributors to the teach-in included Carlos Banuelos (Casa de Maryland), Frida Berrigan (World Policy Institute), Robert Scott (Economic Policy Institute), Len Shindel (United Steel Workers), and Jack Sinnigen (University of Maryland). More than 70 attended the teach-in which was held at Johns Hopkins University. What follows are based on the remarks of Robert Scott (based on notes and presentation given at the Teach-In).
NAFTA and the World Trade Organization are free trade and free investment regimes. Their rules are titled in favor of multinational corporations and against workers and federal, state, and local governments around the world. NAFTA's Chapter 11, which enables corporations to sue governments, is a key example. The choice is not between free trade and fair trade. Rather, it is about the rules that govern international trade and investment which effect who wins and who loses.
What are the impacts of globalization on workers? NAFTA has meant the loss of 766,030 jobs and job opportunities in the US since 1993. Since the World Trade Organization took effect January 1, 1995, 3,040,000 jobs and job opportunities have been lost.
What are the impacts of trade on US wages and incomes? Some general impacts include an indirect effect--the elimination of good job opportunities--and an effect on growing wage inequality since the late 1970s between men and women. Some specific numbers include:
* Rising trade deficits and falling real wages since the 1970s--real production worker wages are down 5.4% between 1978 and 2000
* Rising income inequality since 1979 with flat incomes for the bottom 60% despite a 7.6% increase in working hours--most benefits go to the top 40%
* Trade explains at least 15-25% of the increase in income inequality with other factors including deregulation and weak macro-economic policies
* 15-25% of a 36-38% increase in the wage gap generates huge negative impacts (-5.4% to -17.0%) on the wages of low- and moderate-income workers
* Few other public policies have similar impacts on income; e.g. a middle-class family in 1999 paid taxes equal to 5.4% of its income to the federal government.
Who benefits from globalization in the United States? The primary beneficiaries are college-educated workers, the top 20-40% of households, US corporations, and holders of US financial assets.
What are the impacts of globalization on global poverty? In 1980, the median income of the richest 10% was 77 times greater than the poorest 10%. By 1999, it was 122 times greater. The number of poor people rose from 1987 to 1998. In 1980, the poorest 10% (400 million) lived on $.72 a day, $.79 in 1990, and $.78 in 1999.
Robert Scott. "NAFTA's Hidden Costs: Trade Agreement Results in Job Losses, Growing Inequality & Wage Suppression for the US." EPI Briefing Paper:
www.epinet.org/content.cfm/briefingpapers_nafta01_us
Robert Scott. "Fast Track to Lost Jobs: Trade Deficits and Manufacturing Decline are the Legacies of NAFTA and the WTO." EPI Briefing paper:
www.epinet.org/content.cfm/briefingpapers_bp118
What are the impacts of globalization on workers? NAFTA has meant the loss of 766,030 jobs and job opportunities in the US since 1993. Since the World Trade Organization took effect January 1, 1995, 3,040,000 jobs and job opportunities have been lost.
What are the impacts of trade on US wages and incomes? Some general impacts include an indirect effect--the elimination of good job opportunities--and an effect on growing wage inequality since the late 1970s between men and women. Some specific numbers include:
* Rising trade deficits and falling real wages since the 1970s--real production worker wages are down 5.4% between 1978 and 2000
* Rising income inequality since 1979 with flat incomes for the bottom 60% despite a 7.6% increase in working hours--most benefits go to the top 40%
* Trade explains at least 15-25% of the increase in income inequality with other factors including deregulation and weak macro-economic policies
* 15-25% of a 36-38% increase in the wage gap generates huge negative impacts (-5.4% to -17.0%) on the wages of low- and moderate-income workers
* Few other public policies have similar impacts on income; e.g. a middle-class family in 1999 paid taxes equal to 5.4% of its income to the federal government.
Who benefits from globalization in the United States? The primary beneficiaries are college-educated workers, the top 20-40% of households, US corporations, and holders of US financial assets.
What are the impacts of globalization on global poverty? In 1980, the median income of the richest 10% was 77 times greater than the poorest 10%. By 1999, it was 122 times greater. The number of poor people rose from 1987 to 1998. In 1980, the poorest 10% (400 million) lived on $.72 a day, $.79 in 1990, and $.78 in 1999.
Robert Scott. "NAFTA's Hidden Costs: Trade Agreement Results in Job Losses, Growing Inequality & Wage Suppression for the US." EPI Briefing Paper:
www.epinet.org/content.cfm/briefingpapers_nafta01_us
Robert Scott. "Fast Track to Lost Jobs: Trade Deficits and Manufacturing Decline are the Legacies of NAFTA and the WTO." EPI Briefing paper:
www.epinet.org/content.cfm/briefingpapers_bp118
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