What is the True Correlation between U.S. Exports and Jobs?


The President’s National Export Initiative is currently on track to reach its goal of doubling the value of U.S. exports. Reaching a new high of US$2.1 trillion in 2011, U.S. exports now comprise 13.9% of the nation’s economy. With worldwide economic growth, particularly in Asia, and new trade agreements such as the Trans Pacific Partnership, exports will continue to increase their importance to the U.S. economy. But, are the jobs following?

A new report from the International Trade Administration (ITA) at the U.S. Department of Commerce looks at U.S. exports in terms of their capacity to create jobs. In the report titled “Jobs Supported by Exports, 1993-2011”, ITA finds an increase in the economy’s reliance on exports, but a decrease in the number of jobs supported by every US$1billion in exports.

Comparing labor and export data since 1993, the report shows that each US$1billion in U.S. exports in 2011 supported 5,080 American jobs, fewer than half of the 12,086 jobs supported by each US$1billion in exports in 1993. While rising prices account for about one quarter of the decrease, a sharp climb in productivity among export industries, particularly manufacturing which continues to dominate the export sector, is the largest contributor. The study explains:

“Exports’ increasing share of GDP—yet comparatively stable share of total employment—suggests that labor productivity growth in export sectors and export-supporting sectors has been faster than in the rest of the economy.”

In total, U.S. exports supported 9.7 million jobs in 2011 and employees in those jobs were paid a higher wage than their counterparts. The ITA study demonstrates that as exports become more important to the economy, however, they are also being produced by industries that are rising in productivity faster than the rest of the economy. The result is slower than expected growth in export-supported jobs.