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Manufacturing employment, international trade, and China

The decline in manufacturing employment is often seen as a major reason for rising inequality, social tensions, and the slump of entire communities. With the rise of national populists and protectionists in recent years, the issue has become even more prominent.

By: and Date: November 28, 2019 Topic: Global Economics & Governance

The objective of this paper is to better understand the evolution of manufacturing employment across the world. Manufacturing value added has grown rapidly since 2000, at least matching world GDP growth, even after the global financial crisis, reflecting mainly rising demand for manufactures especially in developing countries. However, manufacturing employment increased at only a slow pace, both before and after the global financial crisis. Manufacturing employment growth provided only about 10% of the new jobs needed to compensate for losses in agriculture and the growth of the active population. Most of the net job creation in manufacturing was in China, while most countries – both developing and developed – saw manufacturing employment decline as a share of total employment and several, including all or nearly all advanced countries, saw an absolute decline. The remarkable economic transformation in China has brought shifts in employment within the country, which were far larger, in fact of a different order of magnitude, than in other countries, entailing the redeployment towards manufacturing of tens of millions of workers, mainly drawn from agriculture. But, because China tends to consume much of the manufactures it produces, especially since the financial crisis, its increased integration into world trade is not at the root of the manufacturing employment stagnation in the rest of the world. In the sample of the countries we examined, including the United States, the increase in labour productivity in manufactures, due to automation and improved methods, was a far more important cause of employment decline than shifts in the manufacturing trade balance, contrary to a commonly held view. We find only weak evidence that the size of the manufacturing sector – measured in different ways — is associated with rapid economic growth. Several countries have grown at a reasonable pace without seeing a large increase in the relative size of their manufacturing sector. While the growth of labour productivity in the manufacturing sector is higher than that of the economy as a whole on average, several economies saw economy-wide labour productivity grow faster than labour productivity in manufacturing, including several countries in East Asia.

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The future of EU-US trade relations after the US election

What shape will the trade relationship between the EU and the US take in the coming years?

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ECFA重要性遞減 台灣出口未來關鍵 在保持科技優勢和出口多元化

從地緣政治角度來看,ECFA自動延續無疑是個好消息,但協議對台灣經濟的直接影響較過去變得有限。雖然台灣對中國大陸的出口仍然重要,但ECFA占整體出口的重要性因資通訊科技產業快速發展而縮小。由於台灣在全球製造業供應鏈遷移和價值鏈重組中占有重要位置,未來對美國和東南亞出口預計將會加速。

By: Alicia García-Herrero Topic: Global Economics & Governance Date: October 20, 2020
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How to keep a competitive environment while engaging with non market economies?

How can we ensure fair competition between European firms and Chinese state-backed players?

Speakers: Julia Anderson, Helge Berger, Carles Esteva Mosso, Alicia García-Herrero, Cian Ruane, Georgios Petropoulos and Guntram B. Wolff Topic: Innovation & Competition Policy Location: Bruegel, Rue de la Charité 33, 1210 Brussels
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What should Europe expect from American trade policy after the election?

A Joe Biden Administration would have to decide to what extent to unpick the major United States trade policy shifts of the last four years. A quick return to comprehensive trade talks with the European Union is unlikely and the US will remain focused on its rivalry with China. Nevertheless, there would be areas for EU/US cooperation, not least World Trade Organisation reform.

By: Uri Dadush and Guntram B. Wolff Topic: Global Economics & Governance Date: October 8, 2020
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Trump’s International Economic Legacy

If Donald Trump loses the United States presidential election in November, he will ultimately be seen to have left little mark in many areas. But in the US's relationship with China, the decoupling of economic links could continue, and that could force Europe into hard choices.

By: Jean Pisani-Ferry Topic: Global Economics & Governance Date: September 29, 2020
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External Publication

Diversification and the world trading system

Diversification is important because it is associated with economic growth and reduced volatility.

By: Uri Dadush, Niclas Poitiers, Abdelaaziz Ait Ali, Mohammed Al Doghan, Muhammad Bhatti, Carlos Braga and Anabel González Topic: Global Economics & Governance Date: September 16, 2020
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Non-summit shows EU-China ties at new low

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By: Alicia García-Herrero Topic: Global Economics & Governance Date: September 16, 2020
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China's 'dual circulation' plan is bad news for others' exports

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By: Alicia García-Herrero Topic: Global Economics & Governance Date: September 15, 2020
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Past Event

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Bruegel Annual Meetings 2020 - Day 3

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Topic: Energy & Climate, European Macroeconomics & Governance, Finance & Financial Regulation, Global Economics & Governance, Innovation & Competition Policy Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: September 3, 2020
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全球為數不多 台灣今年經濟有望正成長

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By: Alicia García-Herrero Topic: Global Economics & Governance Date: August 28, 2020
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Opinion

Relocating production from China to Central Europe? Not so fast!

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By: Zsolt Darvas Topic: Global Economics & Governance Date: August 20, 2020
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