The Trans-Pacific Partnership: Lost US Jobs, Wages and Workers Rights

The Trans-Pacific Partnership: Lost US Jobs, Wages and Workers' Rights

LOST US JOBS

• The TPP will reduce US jobs in the service, public and manufacturing sectors.
  • Service Sector and Call Center Jobs. The TPP will include both investment rules (making it safer to invest overseas) and service sector rules  (guaranteeing access for cross border services here) that will further promote the off-shoring of jobs in call centers, computer programming, engineering, accounting, medical diagnostics and more.
  • Public Sector and Related Jobs.
    • The TPP will give foreign firms operating in the U.S. equal access to the vast majority of federal procurement contracts creating even more incentives for privatization and contracting out.
    • Programs requiring federal and state governments to give preferences for government purchases from US-based providers like “Buy American;” “renewable/recycled;” “sweat free;” and obligations for firms to meet prevailing wages could be challenged by foreign firms before UN and World Bank panels.
  • Manufacturing. The TPP will provide special benefits and rights to firms that off-shore investment and jobs. These new rights would reduce the risks and costs usually associated with off-shoring to countries like Vietnam that impose low wages and unsafe working conditions by violently suppressing workers’ rights.

• Estimated US Job losses in relation to just two TPP countries Japan and Vietnam. 
  • Estimated US Job Losses Based Only on TPP inclusion of Japan and Vietnam
    • Jobs lost to Japan: a net loss of an estimated 91,500 US auto jobs and a reduction of 225,000 automobiles produced in the U.S.[1]
    • Jobs lost to Vietnam: The U.S. could lose another 40,500 jobs due to the estimated $9 billion increase in our trade deficit if Vietnam enters the TPP.[2]
  • The TPP would exacerbate the 2009-2012 trend of Job Loss to Japan and Vietnam [3]
    • Jobs lost to Japan: 130,000 due to a $77 billion increase in our trade deficit
    • Jobs lost to Vietnam: 26,700 due to a $6.5 billion increase in trade deficit

• Past Trade Deals – Bad Precedents for Jobs
  • NAFTA 1994: a net loss of 700,000 US jobs due to trade with Mexico[4] – despite administration estimates that it would create 170,000 new jobs[5]
  • China into the WTO 2001: a net loss of 2.7 million US Jobs despite promises it would increase jobs in the U.S.[6]
  • Korea 2012: a net loss of 40,000 US jobs (mostly manufacturing jobs) in just one year despite US International Trade Commission estimates it would create 70,000 jobs

DOWNWARD PRESSURE ON US WAGES

• The minimum wage for a full day’s work in Vietnam in January 2013 was $2.23 which is less than ½ of China’s daily minimum wage of $4.59[7] and just 4% of the $58 US minimum wage for a full day’s work. 
• A recent report found that the U.S. median wage would fall as a result of the TPP.  “Taking into account the un-equalizing effect of trade on wages, this paper finds the median wage earner will probably lose as a result of any such agreement. In fact, most workers are likely to lose…”[8]

EROSION OF WORKERS RIGHTS. NAFTA included a specific side letter that promised to improve the rights of workers to organize and collectively bargain; the right to strike; labor protections for children and young people; minimum employment standards; the elimination of employment discrimination, protection of migrant workers, and more.  However, since NAFTA workers’ rights in both the U.S. and Mexico have been eroded. 

• Erosion of Workers’ Rights in the U.S.[9]
  • Employers are now twice more likely to use ten or more coercive tactics in their anti-union campaigns than they were before the adoption of NAFTA in 1993.
  • Employer threats made during organizing campaigns to close plants if workers voted for a union rose from 29% in the mid-1980s to 50% in the two years following the adoption of NAFTA to 57% during the mid-2000s.
  • Actual plant closings where these threats were made following union elections rose from 2% to 15% during this period. While there are many reasons for plant closings, the incentives to off-shore jobs and investment due to trade agreements are clearly important.
    
    
• Erosion of Workers’ Rights in Mexico
  • “The Mexican government’s general failure to enforce labor and other laws left workers without much recourse with regard to violations of freedom of association, working conditions and other problems.” (US Department of State).[10]
  • “Although the law prohibits all forms of forced or compulsory labor, the government did not effectively enforce such laws. Forced labor persisted in both the agricultural and industrial sectors.” (US Department of State).
  • “Migrants in transit continued to face abduction, murder and forced recruitment into criminal gangs. Migrant women and children were at particular risk. (Amnesty International).[11]

• Erosion of Workers Rights in Colombia. In April 2011, Colombia and the U.S. negotiated the “Colombian Action Plan related to Labor Rights” in an effort to kick-start the stalled  Colombia Free Trade Agreement negotiations. The Colombia FTA was passed by Congress in October2011.
  • “Violence, threats. Harassment and other practices against trade unionists continued to affect the exercise of the right to freedom of association and collective bargaining. (State Dept).[12]
  • “The law prohibits all forms of forced or compulsory labor. The government did not effectively enforce the law in all cases…”[13] (US Department of State).
  • “…figures on violence against trade unionists…vouch for the existence of a human rights crisis not consistent with random and indiscriminant violence. They reflect a policy of extermination, implemented over a sustained period and manifested by the thousands of lives claimed…. Although some progress has been made, the longstanding violence against the Colombina trade union movement continues to plague the country and trade unionists are still being killed, forcibly disappeared and intimidated.”  (International Trade Union Confederation)[14]

RECOMMENDATION: DO NOT VOTE FOR OR SUPPORT ANY TRADE AGREEMENT THAT COSTS US JOBS, LOWERS OUR WAGES AND ERODES WORKERS RIGHTS

[1] Sean McAlinden and Yen Chin, The Effects a U.S. Free Trade Agreement with Japan would have on the U.S. Automotive Industry, Center for Automotive Research, August 21, 2012

[2] CWA Research Department estimates based on analysis of trade deficits and USTR estimates of the job impact of increased imports and exports.

[3] See footnote 2 for estimates for Vietnam; Estimates for Japan, see Kenneth Peres, Comments on the Participation of Japan in the Trans-Pacific Partnership Negotiations Docket No. USTR-2013-0022, June 9, 2013

[4] Robert Scott, “Heading South: US-Mexico Trade and job displacement after NAFTA, May 3, 2011.

[5] Huffbauer and Schott, NAFTA: An Assessment, Institute for International Economics, 1993,

[6] Robert Scott, The China Toll, Economic Policy Institute, August 23, 2012

[7] Philippines Department of Labor and Employment, National Wages and Productivity Commission, http://www.nwpc.dole.gov.ph/pages/statistics/stat_comparative.html

[8] David Rosnick, Gains from Trade? The net effect of the Trans-Pacific Partnership Agreement on U.S. Wages, Center for Economic and Policy Research, September 2013.

[9] Kate Bronfenbrenner, “No Holds Barred: The Intensification of Employer Opposition to Organizing, American Rights at Work and Economic Policy Institute, 2009

[10] US Department of State, “Mexico 2012 Human Rights Report,” pp. 39-42

[11] Amnesty International, 2013 Annual Report: Mexico, http://www.amnesty.org/en/region/mexico/report-2013

[12] US Department of State, “Colombia 2012 Human Rights Report,” p. 55

[13] US Department of State, “Colombia 2012 Human Rights Report,” p. 59

[14] International Trade Union Congress, Annual Survey of Violations of Trade Union Rights 2012: Colombia http://survey.ituc-csi.org/Colombia.html?edition=336