Trans-Pacific Trade Pact Would Lift U.S. Incomes, but Not Jobs Overall, Study Says

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The Obama administration quickly endorsed the analysis from the Washington-based Peterson Institute for International Economics to buttress its uphill fight for Congress's approval of the Pacific Partnership, completed last October after years of negotiations. An earlier analysis for the World Bank likewise underscored the regional as well as global benefits of the accord, if ratified. Yet both organizations, as champions of international trade, are unlikely to sway the skeptics at a time of widespread economic uncertainty for many American workers.

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The report suggested that the displacement of workers in industries most vulnerable to competition would be relatively small: The resulting movement of workers between jobs and industries, or "churn" in economists' terms, would increase less than 0.1 percent.

But the authors recommended intensified efforts to help the workers inevitably displaced by free trade, calling that "a compelling ethical and political objective."

"Most workers who lose jobs do find alternative employment, but workers in specific locations, industries, or with skill shortages may experience serious transition costs including lasting wage cuts and unemployment," they wrote. "Since the costs to the individuals displaced can be quite high, compensating them for these costs, using a fraction of the total U.S. gains, is a compelling ethical and political objective, and policies to achieve equitable adjustment are likely to be affordable."

While manufacturing jobs would continue to grow, the trade deal would reduce the sector's growth rate by about one-fifth, the analysts said. That would be offset, they added, by higher employment in service and "primary goods" industries such as agriculture and forestry that rely on exports, they added, noting --much like Mr. Obama does -- that export-intensive jobs pay about 18 percent more than other jobs on average.