IDEAS home Printed from https://ideas.repec.org/p/iza/izadps/dp10469.html
   My bibliography  Save this paper

Trade and Manufacturing Jobs in Germany

Author

Listed:
  • Dauth, Wolfgang

    (Institut für Arbeitsmarkt- und Berufsforschung)

  • Findeisen, Sebastian

    (University of Konstanz)

  • Suedekum, Jens

    (Heinrich Heine University Düsseldorf)

Abstract

The German economy exhibits rising service and declining manufacturing employment. But this decline is much sharper in import-competing than in export-oriented branches. We first document the individual-level job transitions behind those trends. They are not driven by manufacturing workers who smoothly switch to services. The observed shifts are entirely due to young entrants and returnees from non-employment. We then investigate if rising trade with China and Eastern Europe causally affected those labor flows. Exploiting variation across industries and regions, we find that globalization did not speed up the manufacturing decline in Germany. It even retained those jobs in the economy.

Suggested Citation

  • Dauth, Wolfgang & Findeisen, Sebastian & Suedekum, Jens, 2017. "Trade and Manufacturing Jobs in Germany," IZA Discussion Papers 10469, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp10469
    as

    Download full text from publisher

    File URL: https://docs.iza.org/dp10469.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Südekum, Jens & Dauth, Wolfgang & Findeisen, Sebastian, 2016. "Adjusting to Globalization - Evidence from Worker-Establishment Matches in Germany," CEPR Discussion Papers 11045, C.E.P.R. Discussion Papers.
    2. Wolfgang Dauth & Sebastian Findeisen & Jens Suedekum, 2014. "The Rise Of The East And The Far East: German Labor Markets And Trade Integration," Journal of the European Economic Association, European Economic Association, vol. 12(6), pages 1643-1675, December.
    3. David H. Autor & David Dorn & Gordon H. Hanson, 2016. "The China Shock: Learning from Labor-Market Adjustment to Large Changes in Trade," Annual Review of Economics, Annual Reviews, vol. 8(1), pages 205-240, October.
    4. Justin R. Pierce & Peter K. Schott, 2016. "The Surprisingly Swift Decline of US Manufacturing Employment," American Economic Review, American Economic Association, vol. 106(7), pages 1632-1662, July.
    5. David H. Autor & David Dorn & Gordon H. Hanson, 2013. "The China Syndrome: Local Labor Market Effects of Import Competition in the United States," American Economic Review, American Economic Association, vol. 103(6), pages 2121-2168, October.
    6. Christian Dustmann & Bernd Fitzenberger & Uta Sch?nberg & Alexandra Spitz-Oener, 2014. "From Sick Man of Europe to Economic Superstar: Germany's Resurgent Economy," Journal of Economic Perspectives, American Economic Association, vol. 28(1), pages 167-188, Winter.
    7. Dani Rodrik, 2016. "Premature deindustrialization," Journal of Economic Growth, Springer, vol. 21(1), pages 1-33, March.
    8. Martin Neil Baily & Barry P. Bosworth, 2014. "US Manufacturing: Understanding Its Past and Its Potential Future," Journal of Economic Perspectives, American Economic Association, vol. 28(1), pages 3-26, Winter.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Luisa Gagliardi,, "undated". "The World’s Rust Belts: The Heterogeneous Effects of Deindustrialization on 1,993 Cities in Six Countries," RF Berlin - CReAM Discussion Paper Series 2317, Rockwool Foundation Berlin (RF Berlin) - Centre for Research and Analysis of Migration (CReAM).
    2. Baumgarten, Daniel & Lehwald, Sybille, 2019. "Trade Exposure and the Decline in Collective Bargaining: Evidence From Germany," Rationality and Competition Discussion Paper Series 165, CRC TRR 190 Rationality and Competition.
    3. Gagliardi, Luisa & Moretti, Enrico & Serafinelli, Michel, 2023. "The World's Rust Belts: The Heterogeneous Effects of Deindustrialization on 1,993 Cities in Six Countries," IZA Discussion Papers 16648, Institute of Labor Economics (IZA).
    4. Baumgarten, Daniel & Irlacher, Michael & Koch, Michael, 2020. "Offshoring and non-monotonic employment effects across industries in general equilibrium," European Economic Review, Elsevier, vol. 130(C).
    5. David Autor & Caroline Chin & Anna Salomons & Bryan Seegmiller, 2024. "New Frontiers: The Origins and Content of New Work, 1940–2018," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 139(3), pages 1399-1465.
    6. Mertens, Matthias, 2020. "Labor market power and the distorting effects of international trade," International Journal of Industrial Organization, Elsevier, vol. 68(C).
    7. Campbell, Douglas L., 2020. "Relative Prices and Hysteresis: Evidence from US Manufacturing," European Economic Review, Elsevier, vol. 129(C).
    8. Sónia Cabral & Pedro S. Martins & João Pereira dos Santos & Mariana Tavares, 2021. "Collateral Damage? Labour Market Effects of Competing with China—at Home and Abroad," Economica, London School of Economics and Political Science, vol. 88(350), pages 570-600, April.
    9. Arni, Patrick & Egger, Peter & Erhardt, Katharina & Gubler, Matthias & Sauré, Philip, 2024. "Heterogeneous Impacts of Trade Shocks on Workers," IZA Discussion Papers 16895, Institute of Labor Economics (IZA).
    10. David Autor & David Dorn & Gordon H. Hanson & Gary Pisano & Pian Shu, 2020. "Foreign Competition and Domestic Innovation: Evidence from US Patents," American Economic Review: Insights, American Economic Association, vol. 2(3), pages 357-374, September.
    11. Gold, Robert & Dippel, Christian & Heblich, Stephan & Pinto, Rodrigo, 2017. "Instrumental Variables and Causal Mechanisms: Unpacking the Effect of Trade on Workers and Voters," VfS Annual Conference 2017 (Vienna): Alternative Structures for Money and Banking 168152, Verein für Socialpolitik / German Economic Association.
    12. Teimouri, Sheida & Zietz, Joachim, 2020. "Coping with deindustrialization: A panel study for early OECD countries," Structural Change and Economic Dynamics, Elsevier, vol. 54(C), pages 26-41.
    13. Christian Dippel & Robert Gold & Stephan Heblich, 2015. "Globalization and Its (Dis-)Content: Trade Shocks and Voting Behavior," NBER Working Papers 21812, National Bureau of Economic Research, Inc.
    14. Jiyoung Kim & Sun Go, 2022. "Exports to China and Local Employment in South Korea," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 30(2), pages 197-214, March.
    15. Moghaddasi Kelishomi, Ali & Nisticò, Roberto, 2022. "Employment effects of economic sanctions in Iran," World Development, Elsevier, vol. 151(C).
    16. Michael Coelli & James Maccarrone & Jeff Borland, 2023. "The dragon Down Under: the regional labour market impact of growth in Chinese imports to Australia," Regional Studies, Taylor & Francis Journals, vol. 57(11), pages 2148-2163, November.
    17. Feenstra, Robert C. & Ma, Hong & Xu, Yuan, 2019. "US exports and employment," Journal of International Economics, Elsevier, vol. 120(C), pages 46-58.
    18. Erling Barth & Henning Finseraas & Anders Kjelsrud & Kalle Moene, 2023. "Hit by the Silk Road: how wage coordination in Europe mitigates the China shock," Scandinavian Journal of Economics, Wiley Blackwell, vol. 125(1), pages 32-72, January.
    19. Dauth, Wolfgang & Findeisen, Sebastian & Südekum, Jens & Wößner, Nicole, 2017. "German robots - the impact of industrial robots on workers," IAB-Discussion Paper 201730, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    20. Daniel Lind, 2022. "The China Effect on Manufacturing Productivity in the United States and Other High-income Countries," International Productivity Monitor, Centre for the Study of Living Standards, vol. 42, pages 33-62, Spring.

    More about this item

    Keywords

    manufacturing; structural transformation; trade; labor markets;
    All these keywords.

    JEL classification:

    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp10469. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Holger Hinte (email available below). General contact details of provider: https://edirc.repec.org/data/izaaade.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.