The Economic Policy Institute recently published a study estimating how many jobs Walmart has effectively eliminated or displaced as a result of its contribution to the U.S. trade deficit with China.
The study states that between 2001 and 2013, the inflated deficit eliminated or displaced 3.2 million U.S. jobs. As the world’s largest retailer, it seems to follow that U.S.-based Walmart would be a key contributor to the climbing deficit and subsequent job losses. The EPI estimates that the retailer’s Chinese imports account for 15.3% of trade deficit growth in that time period.
The study states that, in total, the U.S. trade deficit resulted in a net job loss of nearly 1 million in 2001; that number rose to over 4 million by 2013. It estimates Walmart alone contributed to over 400,000 job losses over those 12 years, and speculates that about 75% of those were manufacturing jobs which offer better pay and benefits than other affected industries, particularly for workers who lack a college education.
Walmart announced in 2013 its plans to increase sourcing of U.S.-made products by $50 billion in the following 10 years, the New York Times reports. The EPI’s study denounces that program claiming that 100 jobs are displaced by the company for every one job created.
The EPI utilized information from a 2007 report to construct these estimates and, since the breakdown of a company’s imports aren’t publicly released, it relied on guesswork. A spokesperson for the company criticized the study:
We are very proud of our U.S. manufacturing initiative and the results speak for themselves. By investing in products that support American jobs, we are able to bring new products to our shelves while bringing new jobs to local communities in Ohio, Tennessee, California, and many others.
Unfortunately, this is an old report with flawed economic analysis that assumed that imports equal job losses and does not take into consideration that countless jobs are added through the global supply chain, distribution and logistics, among other areas of business.
The EPI is headed by chairman Richard L. Trumka who also serves as the president of AFL-CIO, the largest federation of unions in the U.S.
