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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
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    References listed on IDEAS

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    1. 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.
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    3. 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.
    4. 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.
    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. 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.
    7. Dani Rodrik, 2016. "Premature deindustrialization," Journal of Economic Growth, Springer, vol. 21(1), pages 1-33, March.
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    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

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