Wen Jin. queen of the discussion board, brought to my attention this New York Times article by Daniel Drezner, U of C assisstant professor of political science. Here's the meat:
The Government Accountability Office has issued its first review of the data, and one undeniable conclusion to be drawn from it is that outsourcing is not quite the job-destroying tsunami it's been made out to be. Of the 1.5 million jobs lost last year in "mass layoffs'' - that is, when 50 or more workers are let go at once - less than 1 percent were attributed to overseas relocation; that was a decline from the previous year. In 2002, only about 4 percent of the money directly invested by American companies overseas went to the developing countries that are most likely to account for outsourced jobs - and most of that money was concentrated in manufacturing.
Echoing our discussion of Stanley Fischer's contention, Drezner makes the following observation:
Technological innovation is responsible for a far greater number of lost jobs than outsourcing. The Bureau of Labor Statistics estimated that in the first quarter of this year 4,633 workers were laid off because of offshoring. In the same period Kodak, for example, announced layoffs of 15,000 workers because the growth of digital photography reduced demand for film. Few Americans suggest technological innovation be stifled for the sake of preserving old jobs. Yet during election years, restrictions on outsourcing are considered fair game.
Of course, we still have the sticky issue of trying to figure out why technology is costing jobs, rather than creating them.
P.S. -- Drezner has a longer article on this topic, published in the journal Foreign Affairs. The full GAO report can be found here.
P.P.S. Drezner has a blog of his own. It now has an honored spot on the links section to the left.