Made in China: The Impact of Chinese Import Competition on U.S. Textile and Apparel Manufacturing Labor Outcomes

Abstract

This paper analyzes the effect of rising Chinese import competition in the period 1995-2011 on labor market outcomes in the U.S. Textile and Apparel (T&A) industry across 51 spatially distinct labor markets (50 U.S. states and the District of Columbia) that face varying degrees of exposure to international trade. Using import data extracted from the World Input Output Database and state-industry labor data from the Bureau of Economic Analysis, I adapt and narrow the model presented in Autor, Dorn, Hanson (2013) to apply to the singular T&A industry. This singular focus strays from existing trade and labor literature which tend to look at the effects of increased trade exposure on aggregate manufacturing industries, which contain dynamic sectors that may be by trade exposure in different magnitudes and directions. I estimate that an exogenous 1 percent increase in import exposure per worker from Chinese T&A goods in the period 1995-2011 is associated with a 0.27 percent decline in the share of U.S. T&A manufacturing employment in total employment and a 0.002 percent decline in the annual average wages of T&A manufacturing workers. These results are higher in magnitude than the results found in Autor et al. (2013).