You don’t often turn to the State of Trade blog for food advice. While we’re a fantastic repository for insightful and enjoyable trade policy analysis, our blogs usually whet your appetite for increased international competitiveness…not lunch. But thanks to Imports Work Week, we’re all about delicious coffee, bananas and chocolates.
Or, at least, that’s the clever opening line of our recent joint WCIT-Tacoma-Pierce Chamber op-ed on the positive (and often forgotten) roles imports play in our 21st century economy. So coffees, bananas and chocolates not only make a great snack (and a good suggestion for a new Ben & Jerry’s ice cream flavor – Importer’s Delight!); they help reinforce the underappreciated message that imports are key to our state’s trade success.
Those of you who regularly read the State of Trade blog already know a good deal about the value of imports (thanks to our past three blog posts on the “import-ance of import-ing”). In fact, last year’s International Competitiveness Strategy found at least 277,000 jobs in our state are tied to imports, and we recently released a new Imports Factsheet that explains these numbers in greater detail.
However, several studies have come out recently that expand our understanding of the impact of imports on our economy.
On Monday, the Trade Partnership released Imports Work for America, which found that imports support 16 million jobs in the United States in industries ranging from port and freight services to manufacturing and retail. That’s an astounding 9.3 percent of U.S. employment!
The study points out that, contrary to popular belief, the effect of imports on most sectors, including manufacturing, has been quite good. For example, manufacturers rely heavily on access to low-cost, high quality imported inputs, which enable them to lower production costs, create more competitive products, and sell to more consumers. Lower costs and more sales = more U.S. jobs all along the value chain.
Similarly, another recent study, the Federal Reserve Bank of St. Louis’ U.S. Manufacturing and the Importance of International Trade: It’s Not What You Think, called imports the “lifeblood” of U.S. manufacturing and found that imports account for a far greater share of U.S. manufacturing value added than do exports. In Washington state, this is no surprise; many of our manufacturers, from Boeing to Genie Industries rely on imported components to produce innovative and competitive products.
The retail industry also creates thousands of jobs in our state through imports. Think about how many Washington state companies – Amazon.com, Costco, Nordstrom, REI, Eddie Bauer, Sur la Table – depend on a global supply chain to efficiently produce or source many of the items they sell. Even if the label on many of these goods does not say “Made in USA,” chances are that the majority of the purchase price of the product stays right here, supporting American jobs such as engineers, designers, testers, marketers, merchandisers, warehousers, and sales associates. In today’s globally connected economy, products are often designed and tested in the United States and only assembled abroad. For example, another new study by Moongate Associates, Analyzing the Value Chain for Apparel Designed in the United States and Manufactured Overseas, found that over seventy percent of the value of a garment designed in the U.S. and assembled abroad was added in the United States.
Finally, the Imports Work for America study also emphasized the positive role imports play for every American consumer. Without imports, most consumer products like electronics, housewares, furniture and clothes would be much more expensive, straining many Americans’ already tight budgets. In addition, imports provide access to products we wouldn’t have otherwise (and that make our lives a little brighter!).
While we should never forget how important exports are for economic growth, we should also recognize imports have an equally important role in our economy. In Washington state, imports are frequently job creators. In the meantime, does anyone know how I can get in touch with Ben & Jerry’s recipe department? I have a suggestion I’d like to pass along…