Research
The Impact of China Shock on Occupational Employment of High-skilled Workers: Evidence from
US Local Labor Markets
December 2022
This paper analyzes the impact of US import competition from China on the occupational employment of college-educated workers in the US local labor markets over recent decades. I find that the US import competition from China reallocated college-educated workers from manufacturing to non-manufacturing jobs in the US commuting zones. The college-educated workers reallocated both upward to high-skill, non-routine occupations as well as downward to low-skill, non-routine jobs. High human capital regions exposed to the China shock exhibit upward occupational reallocation of
college-educated workers whereas downward reallocation is seen for low human capital regions.
US Exports, Local Labor Markets, and Wage Inequality
October 2021
This paper empirically investigates the effects of US global export expansion and import competition from China on US local labor markets. This paper analyses the impact of US exports on local labor market outcomes such as employment, unemployment and non-participation for different skill levels, thereby also quantifying the contribution of exports to wage inequality. I find that an increase in US exports creates manufacturing jobs and reduces the unemployment rate especially among high-skilled workers with either a college degree or experience contributing to wage inequality by paying higher wages to them. A one percentage point increase in export exposure in the local commuting zone leads to, on average, a 0.24 percentage points reduction in the local unemployment rate and a 0.57 percentage points increase in the local manufacturing employment rate between 1991 and 2011. US export expansion also raises the job participation rate among high-skilled workers. Low-skilled workers are most adversely affected by import penetration from China.
The Impact of US Trade Exposure on Local Labor Market Unemployment
March 2019
This paper empirically investigates the impact of United States import competition from China and global export expansion on commuting-zone unemployment. I find a significant and negative net effect of trade exposure on the annual change in the unemployment rate for the period 1991 to 2007 but not beyond 2007 till 2011 i.e. the period including the Great Recession. A one percentage point increase in export exposure reduces the unemployment rate by 0.42 percentage points while a one percentage point increase in import exposure from China increases the unemployment rate by 0.32 percentage points between 1991 and 2007. I do not find any significant effect of trade exposure on the annual change in local long-run unemployment rate.