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Published: Wednesday, 3/24/2010

China got 26,000 Toledo area jobs

BY GARY T. PAKULSKI
BLADE BUSINESS WRITER

Unemployed workers in places like Perrysburg, Fremont, and Bryan shake their heads and ask, "Where have all the jobs gone?"

A new study by the think tank Economic Policy Institute has a partial answer: China.

The 5th congressional district led Ohio in manufacturing job losses attributed to America's trade deficit, primarily with China, the organization said yesterday.

The study, which found that even high-tech industries like computer-manufacturing are no longer immune from the jobs migration, said that 2.4 million U.S. factory jobs were lost to the trade deficit in the seven-year period following China's entrance to the World Trade Organization in 2001.

"The loss of manufacturing jobs has been critical especially for workers without a college degree," said study author Robert E. Scott, a senior economist for the liberal-leaning think tank. He added that manufacturing is the best source of good jobs for workers with high school diplomas or less. Such people compose 70 percent of the work force, Mr. Scott said.

The study estimated that Ohio lost 91,800 jobs to China for the eighth worst job losses in the nation. California ranked first with 370,000 jobs lost. Three congressional districts there were also at the top of the list as electronics-equipment manufacturers, which have a significant presence in the Golden State, experienced some of the greatest growth in trade deficits with China.

Ohio's 5th congressional district, which includes the Toledo suburbs of Perrysburg and Rossford as well as Tiffin, Bryan, and Fostoria, lost 6,700 manufacturing factory jobs, or 2.2 percent of all workers, to the trade deficit, the report said. That was a bigger loss than anywhere else in Ohio.

Nearly 26,000 jobs were lost between 2001 and 2008 in the five congressional districts covering all or portions of northwest Ohio and southeast Michigan.

"There is a great deal of concern in manufacturing about fair trade with China," said Eric Burkland, president of the 1,500-member Ohio Manufacturers' Association.

At the top of the list of concerns, he said, are Chinese subsidies for industry there as well as problems with U.S. enforcement of existing trade agreements.

Mr. Scott, study author, discounted the possibility that increased automation played a major role in the job losses. The study covered a period when trade with China surged and automation-fueled productivity improvements leveled off at U.S. factories, he said.

Among factors in the imbalance, the study cited China's maintenance of an artificially low value for its currency.

The U.S. trade deficit with the Asian nation soared from $84 billion in 2001 to $270 billion seven years later, the author reported. Imports of Chinese computers and other electronics products accounted for 40 percent of the change, he said.

In 2009, the study continued, China accounted for more than 80 percent of the United States' nonoil-trade deficit.

Big losers, in addition to the 5th district, include Ohio's 4th district, which includes Findlay, and Michigan's 7th district, which encompasses Lenawee and Hillsdale counties. They lost 5,900 jobs and 4,700 jobs respectively. Ohio's 9th district, including Toledo, lost 4,100 jobs and Michigan's 15th district, including Monroe, lost 4,200.

Rep. Bob Latta (R., Bowling Green), who represents Ohio's hard-hit 5th District, agreed that the trade imbalance is troubling.

"We have the largest manufacturing district in the state of Ohio," Mr. Latta said. "Two years ago, we were ninth largest in Congress. Now we are 20th."

Unrealistic air and water quality standards handicap U.S. manufacturers at the same time that reliance on Chinese investment in U.S. debt makes it difficult to pressure the nation to re-value its currency, he said.

"The world out there has got to say to the Chinese that your currency is not in line and is creating unfair competition," the congressman said.

Kevin Sauder, chief executive of Sauder Woodworking in Archbold, said his firm has done all that it can to preserve jobs in northwest Ohio's 5th district but acknowledged that it has begun to produce some labor-intensive products in China in response to market conditions.

The firm, which is among the world's leading producers of ready-to-assemble furniture, employs about 1,700 people at manufacturing operations in Archbold.

"I'm less about complaining about the economics of the situation and more about seeing what we can do to stay competitive and stay automated and keep as many jobs as we can in northwest Ohio," he said.

Contact Gary Pakulski at:

gpakulski@theblade.com

or 419-724-6082.



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