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NATIONAL BUREAU OF ECONOMIC RESEARCH

NBER Working Papers by Shannon Phillips

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Working Papers

June 2009Why are American Workers getting Poorer? Estimating the Impact of Trade and Offshoring Using the CPS
with Avraham Ebenstein, Ann Harrison, Margaret McMillan: w15107
Previous studies typically find small or insignificant effects of globalization on US workers. We argue that much of the impact on wages has been missed because globalization has led workers to move from higher paid manufacturing jobs to lower paid service jobs. To show this, we link industry-level data on trade and offshoring with individual-level worker data from the Current Population Surveys. Previous research focused on industry-level exposure to globalization, which we show has no significant impact on worker wages. Our new measure of occupational exposure to globalization shows significant effects of globalization on wages. Offshoring to low wage countries is associated with wage declines for US workers, and the workers most affected are those performing routine tasks. Import compet...

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