NAFTA and Workers' Rights and Jobs

 

The central focus of pro-NAFTA campaigning was the issue of U.S. job creation, so it is fair to measure NAFTA's real-life results against its backers' expansive promises of hundreds of thousands of new, high-paying U.S. jobs. However, even measured against the more lenient "do no harm" standard, NAFTA has been a failure. Using trade flow data to calculate job loss under NAFTA (incorporating exactly the formula used by NAFTA's backers to predict 200,000 per year NAFTA job creation) yields net job destruction numbers in the hundreds of thousands. Whether the loss of hundreds of thousands of jobs qualifies as "a giant sucking sound" depends on the ear of the listener. It is clear, however, that NAFTA has indisputably led to widespread job loss, with over 412,177 U.S. workers certified as NAFTA casualties under just one narrow government program. The fact that job growth totally unrelated to NAFTA has produced a net gain in U.S. employment during this period in no way changes the reality that NAFTA has cost large numbers of individual workers their jobs,­ most of whom are now unemployed or working at jobs that pay less than the ones they lost.

The U.S. economy created jobs at a fairly rapid rate in the 1990s, but without NAFTA, hundreds of thousands of full time, high wage, benefit-paying manufacturing jobs would not have been lost. It is also important to note that while the U.S. economy is generating substantial numbers of new jobs in absolute terms, the quality of the jobs created is often poor. The U.S. Department of Labor projects that the professions with the greatest expected future growth in the U.S. are cashiers, waiters and waitresses, janitors and retail clerks. These and other lower-wage service jobs are the kind that will most likely be available to workers displaced by NAFTA.

Economic surveys of dislocated workers shows that the jobs lost to NAFTA, in many cases high-paying manufacturing jobs, are, in the majority of cases, replaced by lower-paid employment. NAFTA also has had a negative effect on the wages of many Americans whose jobs have not been relocated but whose wage bargaining power with their employers is substantially lessened; NAFTA puts them in direct competition with skilled, educated Mexican workers who work for a dollar or two an hour ­or less. NAFTA was supposed to ameliorate this problem by raising Mexican living standards and wages. Instead, both have plummeted, harming the economic prospects for workers on both sides of the border.

Trade Adjustment Assistance (TAA) Database
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