NAFTA's Pain Deepens: Job Destruction Accelerates in 1999

Publication Date: November 1999

Publisher: Economic Policy Institute

Author(s): Robert E. Scott

Research Area: Economics; Trade

Type: Brief

Abstract:

From the time the North American Free Trade Agreement (NAFTA) took effect in 1994 through 1998, growth in the net export deficit with Mexico and Canada has destroyed 440,172 American jobs. Moreover, through the first half of 1999 the portion of the U.S. trade deficit attributable to NAFTA has nearly doubled in comparison to the same period last year, leading to even more job losses.

Many previous evaluations of NAFTA's impact on the domestic economy have failed to consider imports as well as exports. Ignoring the impact of imports is like trying to keep score in a baseball game by counting only the runs scored by the home team. When the United States exports 1,000 cars to Mexico, many American workers are employed in their production. If, however, the U.S. imports 1,000 or more cars from Mexico rather than build them domestically, then a similar number of Americans who would have been employed in the auto industry will have to find other work.