Why Trade Doesn’t Cause Unemployment

Recently some have claimed that international trade is responsible for unemployment in the United States. It can be shown that over the last 40 years this has not been the case.

Others have argued that imports destroy American jobs. Again, these claims are mistaken.

According to Bryan Riley and Anthony Kim, senior policy analysts at The Heritage Foundation, “the freedom to trade is the foundation of America’s modern economic system” and “free and open trade has fueled vibrant competition, innovation, and economies of scale.”

Here are five free trade facts:

1. A comparison of economic performance and trade scores in the "2016 Index of Economic Freedom" demonstrates the importance of trade freedom for prosperity and well-being.
2. Countries with the most trade freedom have higher per capita incomes, lower rates of hunger in their populations, and cleaner environments.
3. Countries with low tariffs and few non-tariff barriers have stronger economic growth. Free trade policies also encourage freedom in general—including protection of private property rights and the freedom of average people to buy what they think is best for their families.
4. The simplest way to achieve trade freedom is to unilaterally reduce tariff and non-tariff barriers.
5. Most Americans are open to the idea of more free trade.

The United States should therefore encourage competition in the economy and promote free trade, rather than entertain false claims that trade causes unemployment.