Transcript Outsourcing and U.S. Economic Growth: The Role of Imported Intermediate Inputs Christopher Kurz, Paul Lengermann Federal Reserve Board of Governors* World Congress on National Accounts.

Outsourcing and U.S. Economic Growth: The
Role of Imported Intermediate Inputs
Christopher Kurz,
Paul Lengermann
Federal Reserve Board of Governors*
World Congress on National Accounts – May 2008
*The views expressed below are those of the authors and should not be attributed to the Federal Reserve
Board
20.0%
Imported Intermediate Share of Intermediate Inputs
18.0%
16.0%
14.0%
12.0%
10.0%
8.0%
6.0%
Imported share of total intermediates
Imported share of manufacturing intermediates
4.0%
1997
1998
1999
2000
2001
2002
2003
2004
2005
Overview
• We define foreign outsourcing as trade in intermediates
• Focus on outsourcing at the aggregate level
• Estimate contribution to overall economic growth
• Utilize new data to perform growth accounting
– Unpublished industry-commodity level BEA data on imported intermediates
and prices
– Outsourcing is a manufacturing phenomenon and is accelerating
• Results 1997-2005
– 15 percent of US growth attributed to imported intermediates, and accelerated
– 1/3 manufacturing growth from imported intermediates, mostly in durables,
and is accelerating
– We find link between employment growth and outsourcing growth
Data
Multiple sources required to perform growth accounting and estimate MFP
For industry or aggregate k:
• Gross output (Qk), intermediate inputs (Mk) and prices
from BEA GDP-by-industry accounts.
• Capital stock (Kk) from BEA asset-by-industry net
stocks—aggregated to capital services: IT & other
• Labor (Lk) based on hours worked and adjusted with CBP
Outsourcing Data
Imported intermediates and prices from published and unpublished BEA data
• Data for 1997 to 2005 at the detailed industry-by-commodity level
• Value of imported inputs
– Based on detailed input-output tables
– Assumes value of imported commodities used by each industry is the same as
the ratio of total imports to domestic supply
• Prices for imported inputs
– Concorded between BLS SITC import price indexes and BEA commodity
codes and constructed by BEA
We aggregate and concord the detailed industry-by-commodity data
(272) and price data to the GDP-by-industry level (65) for industry
or aggregate k.
The importance of outsourcing
• The role of foreign outsourcing has increased over the
past several decades
– Important in the production process
– Important as a driver of increasing trade shares
• For each industry we construct a measure of “ownindustry” imported intermediate use.
• We find the following stylized facts:
– Most imports are in manufacturing: 85%
– Intermediate imports large fraction of imports
– Own-industry intermediate imports large fraction of
imports
– Imported share of intermediates is growing
– Large amount of heterogeneity
The importance of outsourcing…cont
• Intermediate imports large fraction of imports
– 43 percent for total imports, 38 percent manufacturing
– Shares roughly constant over our sample
• Own-industry intermediate imports large fraction of
imports
– 28 percent for total, 41 percent for manufacturing
– Trending downward (23% and 33% in 2005)
• Imported share of intermediates is growing
– 30 percent increase for all intermediates and 40 percent for
manufacturing
Methodology: Measuring Intermediates
Intermediate inputs can be decomposed
other
own
other
M k  M kown

M

M

M
,F
k ,F
k ,D
k ,D
M kown
, F   X ij
ik jk
• Xij is element of domestic input-output use table
• We calculate
M kother
,D
as a residual.
• The real growth rates of other-domestic inputs are
calculated via chain-stripping Mˆ kother
from Mˆ k .
,D
Measuring Intermediates
Total Purchased Inputs (M) for sector/industry k
Domestic Intermediates
(MD)
Own Domestic (MDown)
Other Domestic (MDother)
Foreign Intermediates
(MF)
Own Foreign (MFown)
Other Foreign (MFother)
•
Total Intermediates and Prices BEA GDP by industry accounts
•
Imported Intermediates and prices from BEA imported intermediates data
•
Assume domestic intermediates price is gross output price
•
Calculate real growth rates Mˆ kown
ˆ own ˆ other
,D , M k ,F , M k ,F
• Mˆ kother
Is calculated residually
,D
Methodology
Two approaches:
– Sectoral output Sk
Sˆk  Qˆ k  Mˆ kown
,D
M
M i ,F
ˆ other  s M i ,D Mˆ other )
MFˆPi  Sˆi  ( siL Lˆi  siK Kˆ i  si i ,F Mˆ iown

s
M
,F
i
i,F
i
i,D
own
other
other

M
M i ,F ˆ own
M i ,F
k
L ˆ
K ˆ
other
ˆ
ˆ
Sˆk  sk k ,D Mˆ kother

d
M
F
P

s
L

s
K

s
M

s
M
 i
,D
i
i i
i
i
i
i,F
i
i,F
other
ik
own
other

• d is a Domar weight and sj is an cost share
– Gross output Qk
M
M
MFˆPi  Sˆi  ( siL Lˆi  siK Kˆ i  si Mˆ iown

s
,F
i
own
i ,F
other
i ,F
M i ,D ˆ other
M i ,D ˆ own
Mˆ iother

s
M

s
M i,D )
,F
i
i,D
i
other
own
Results—sources of growth
Table 4
Sources of growth in sectoral output
1
for U.S. private industry and major industry groups
Sectoral
Output
(1)
MFP
(2)
IT
2
Capital
(3)
Other
3
Capital
(4)
Labor
(5)
Purchased Domestic Purchased Foreign Inputs:
Inputs:
Other
Own
(6)
(7)
(8)
A. 1997 to 2005
1. Private industries
6.
Manufacturing
7.
Durable goods
8.
Nondurable goods
9. Services-producing industries
3.4
1.9
2.8
.3
3.5
1.6
1.9
2.9
.5
1.2
.6
.2
.2
.1
.7
.5
.1
.1
.0
.6
.3
-.9
-1.0
-.6
.6
-.1
.1
-.1
.1
.1
.4
.4
.5
.2
.2
.1
.2
.3
.0
.0
C. 2003 to 2005
1. Private industries
3.2
2.4
.3
.2
.2
-.5
.5
.1
D. Difference in Annual Averages,
(2003 to 2005) vs. (1997 to 2002)
1. Private industries
-.3
1.3
-.5
-.5
-.1
-.7
.2
.0
Results—sources of growth
Table 4
Sources of growth in sectoral output
1
for U.S. private industry and major industry groups
Sectoral
Output
(1)
MFP
(2)
IT
2
Capital
(3)
Other
3
Capital
(4)
Labor
(5)
Purchased Domestic Purchased Foreign Inputs:
Inputs:
Other
Own
(6)
(7)
(8)
A. 1997 to 2005
1. Private industries
6.
Manufacturing
7.
Durable goods
8.
Nondurable goods
9. Services-producing industries
3.4
1.9
2.8
.3
3.5
1.6
1.9
2.9
.5
1.2
.6
.2
.2
.1
.7
.5
.1
.1
.0
.6
.3
-.9
-1.0
-.6
.6
-.1
.1
-.1
.1
.1
.4
.4
.5
.2
.2
.1
.2
.3
.0
.0
C. 2003 to 2005
1. Private industries
3.2
2.4
.3
.2
.2
-.5
.5
.1
D. Difference in Annual Averages,
(2003 to 2005) vs. (1997 to 2002)
1. Private industries
-.3
1.3
-.5
-.5
-.1
-.7
.2
.0
• 15 percent of output growth stems from imported
intermediates; 30 percent in manufacturing
Results—sources of growth
Table 4
Sources of growth in sectoral output
1
for U.S. private industry and major industry groups
Sectoral
Output
(1)
MFP
(2)
IT
2
Capital
(3)
Other
3
Capital
(4)
Labor
(5)
Purchased Domestic Purchased Foreign Inputs:
Inputs:
Other
Own
(6)
(7)
(8)
A. 1997 to 2005
1. Private industries
6.
Manufacturing
7.
Durable goods
8.
Nondurable goods
9. Services-producing industries
3.4
1.9
2.8
.3
3.5
1.6
1.9
2.9
.5
1.2
.6
.2
.2
.1
.7
.5
.1
.1
.0
.6
.3
-.9
-1.0
-.6
.6
-.1
.1
-.1
.1
.1
.4
.4
.5
.2
.2
.1
.2
.3
.0
.0
C. 2003 to 2005
1. Private industries
3.2
2.4
.3
.2
.2
-.5
.5
.1
D. Difference in Annual Averages,
(2003 to 2005) vs. (1997 to 2002)
1. Private industries
-.3
1.3
-.5
-.5
-.1
-.7
.2
.0
• 15 percent of the of output growth stems from imported
intermediates
• The contribution has accelerated
Results—sources of growth
Table 4
Sources of growth in sectoral output
1
for U.S. private industry and major industry groups
Sectoral
Output
(1)
MFP
(2)
IT
2
Capital
(3)
Other
3
Capital
(4)
Labor
(5)
Purchased Domestic Purchased Foreign Inputs:
Inputs:
Other
Own
(6)
(7)
(8)
A. 1997 to 2005
1. Private industries
6.
Manufacturing
7.
Durable goods
8.
Nondurable goods
9. Services-producing industries
3.4
1.9
2.8
.3
3.5
1.6
1.9
2.9
.5
1.2
.6
.2
.2
.1
.7
.5
.1
.1
.0
.6
.3
-.9
-1.0
-.6
.6
-.1
.1
-.1
.1
.1
.4
.4
.5
.2
.2
.1
.2
.3
.0
.0
C. 2003 to 2005
1. Private industries
3.2
2.4
.3
.2
.2
-.5
.5
.1
D. Difference in Annual Averages,
(2003 to 2005) vs. (1997 to 2002)
1. Private industries
-.3
1.3
-.5
-.5
-.1
-.7
.2
.0
• 15 percent of the of output growth stems from imported
intermediates
• The contribution has accelerated
• Disaggregation of intermediates inputs would miss
contribution from foreign intermediates
Results—sources of growth in manufacturing
Table 6
Sources of growth for U.S. manufacturing industries1
A. 1997 to 2005
Durable goods:
1. Wood products
2. Nonmetallic mineral products
3. Primary metals
4. Fabricated metal products
5. Machinery
6. Computer and electronic products
7. Elect. equip., appliances, & components
8. Motor vehicles, bodies and trailers, & parts
9. Other transportation equipment
10.
Furniture and related products
11.
Miscellaneous manufacturing
Nondurable goods:
12.
Food and beverage and tobacco products
13.
Textile mills and textile product mills
14.
Apparel and leather and allied products
15.
Paper products
16.
Printing and related support activities
17.
Petroleum and coal products
18.
Chemical products
19.
Plastics and rubber products
Gross
Output
(1)
MFP
(2)
IT
Capital2
(3)
Other
Capital3
(4)
Labor
(5)
Purchased Domestic Inputs
Other
Own
(6)
(7)
0.6
1.1
-1.0
-0.5
-0.1
7.7
-1.0
2.0
0.7
2.2
3.3
0.6
0.6
0.9
0.8
0.7
7.9
1.2
0.5
0.5
1.2
2.6
0.0
0.1
0.0
0.1
0.3
0.1
0.0
0.1
0.2
0.1
0.1
0.0
0.2
-0.1
0.1
0.2
0.1
-0.1
0.1
0.1
0.2
0.0
-0.2
-0.3
-0.9
-0.6
-1.0
-1.2
-1.1
-0.4
-1.2
-0.5
-0.8
0.4
0.4
-0.8
-0.6
-0.7
-0.3
-1.0
0.5
0.7
0.8
0.8
0.7
-3.4
-9.7
-1.4
-2.1
-0.2
0.4
0.8
0.0
1.5
1.3
0.4
0.6
-0.3
0.8
0.7
0.1
0.0
0.0
0.0
0.2
0.1
0.2
0.1
-0.1
-0.2
-0.1
-0.2
0.1
-0.1
0.1
0.2
-0.1
-1.8
-3.2
-0.8
-1.0
-0.1
-0.2
-0.5
0.8
-1.5
-6.5
-0.5
-1.5
-0.4
-0.4
0.0
Purchased Foreign Inputs
Other
(8)
Own
(9)
-0.4
0.0
-0.5
-0.3
-0.1
0.5
-0.3
0.2
-0.6
0.0
0.1
0.2
0.2
0.2
0.2
0.4
0.3
0.2
0.7
0.8
0.4
0.4
0.0
0.1
0.2
0.0
0.1
0.2
0.1
0.4
0.1
0.0
0.1
-0.1
-1.4
-0.7
-0.5
-0.4
-0.3
-0.3
0.0
0.1
0.0
-0.4
0.1
0.0
0.4
0.2
0.4
0.0
-0.1
-0.1
0.0
0.0
0.4
0.1
0.0
Results—sources of growth in manufacturing
Table 6
Sources of growth for U.S. manufacturing industries1
A. 1997 to 2005
Durable goods:
1. Wood products
2. Nonmetallic mineral products
3. Primary metals
4. Fabricated metal products
5. Machinery
6. Computer and electronic products
7. Elect. equip., appliances, & components
8. Motor vehicles, bodies and trailers, & parts
9. Other transportation equipment
10.
Furniture and related products
11.
Miscellaneous manufacturing
Nondurable goods:
12.
Food and beverage and tobacco products
13.
Textile mills and textile product mills
14.
Apparel and leather and allied products
15.
Paper products
16.
Printing and related support activities
17.
Petroleum and coal products
18.
Chemical products
19.
Plastics and rubber products
Gross
Output
(1)
MFP
(2)
IT
Capital2
(3)
Other
Capital3
(4)
Labor
(5)
Purchased Domestic Inputs
Other
Own
(6)
(7)
0.6
1.1
-1.0
-0.5
-0.1
7.7
-1.0
2.0
0.7
2.2
3.3
0.6
0.6
0.9
0.8
0.7
7.9
1.2
0.5
0.5
1.2
2.6
0.0
0.1
0.0
0.1
0.3
0.1
0.0
0.1
0.2
0.1
0.1
0.0
0.2
-0.1
0.1
0.2
0.1
-0.1
0.1
0.1
0.2
0.0
-0.2
-0.3
-0.9
-0.6
-1.0
-1.2
-1.1
-0.4
-1.2
-0.5
-0.8
0.4
0.4
-0.8
-0.6
-0.7
-0.3
-1.0
0.5
0.7
0.8
0.8
0.7
-3.4
-9.7
-1.4
-2.1
-0.2
0.4
0.8
0.0
1.5
1.3
0.4
0.6
-0.3
0.8
0.7
0.1
0.0
0.0
0.0
0.2
0.1
0.2
0.1
-0.1
-0.2
-0.1
-0.2
0.1
-0.1
0.1
0.2
-0.1
-1.8
-3.2
-0.8
-1.0
-0.1
-0.2
-0.5
0.8
-1.5
-6.5
-0.5
-1.5
-0.4
-0.4
0.0
Purchased Foreign Inputs
Other
(8)
Own
(9)
-0.4
0.0
-0.5
-0.3
-0.1
0.5
-0.3
0.2
-0.6
0.0
0.1
0.2
0.2
0.2
0.2
0.4
0.3
0.2
0.7
0.8
0.4
0.4
0.0
0.1
0.2
0.0
0.1
0.2
0.1
0.4
0.1
0.0
0.1
-0.1
-1.4
-0.7
-0.5
-0.4
-0.3
-0.3
0.0
0.1
0.0
-0.4
0.1
0.0
0.4
0.2
0.4
0.0
-0.1
-0.1
0.0
0.0
0.4
0.1
0.0
•Contribution of domestic intermediates mostly negative; imported
intermediates mostly positive
Results—sources of growth in manufacturing
Table 6
Sources of growth for U.S. manufacturing industries1
A. 1997 to 2005
Durable goods:
1. Wood products
2. Nonmetallic mineral products
3. Primary metals
4. Fabricated metal products
5. Machinery
6. Computer and electronic products
7. Elect. equip., appliances, & components
8. Motor vehicles, bodies and trailers, & parts
9. Other transportation equipment
10.
Furniture and related products
11.
Miscellaneous manufacturing
Nondurable goods:
12.
Food and beverage and tobacco products
13.
Textile mills and textile product mills
14.
Apparel and leather and allied products
15.
Paper products
16.
Printing and related support activities
17.
Petroleum and coal products
18.
Chemical products
19.
Plastics and rubber products
Gross
Output
(1)
MFP
(2)
IT
Capital2
(3)
Other
Capital3
(4)
Labor
(5)
Purchased Domestic Inputs
Other
Own
(6)
(7)
0.6
1.1
-1.0
-0.5
-0.1
7.7
-1.0
2.0
0.7
2.2
3.3
0.6
0.6
0.9
0.8
0.7
7.9
1.2
0.5
0.5
1.2
2.6
0.0
0.1
0.0
0.1
0.3
0.1
0.0
0.1
0.2
0.1
0.1
0.0
0.2
-0.1
0.1
0.2
0.1
-0.1
0.1
0.1
0.2
0.0
-0.2
-0.3
-0.9
-0.6
-1.0
-1.2
-1.1
-0.4
-1.2
-0.5
-0.8
0.4
0.4
-0.8
-0.6
-0.7
-0.3
-1.0
0.5
0.7
0.8
0.8
0.7
-3.4
-9.7
-1.4
-2.1
-0.2
0.4
0.8
0.0
1.5
1.3
0.4
0.6
-0.3
0.8
0.7
0.1
0.0
0.0
0.0
0.2
0.1
0.2
0.1
-0.1
-0.2
-0.1
-0.2
0.1
-0.1
0.1
0.2
-0.1
-1.8
-3.2
-0.8
-1.0
-0.1
-0.2
-0.5
0.8
-1.5
-6.5
-0.5
-1.5
-0.4
-0.4
0.0
Purchased Foreign Inputs
Other
(8)
Own
(9)
-0.4
0.0
-0.5
-0.3
-0.1
0.5
-0.3
0.2
-0.6
0.0
0.1
0.2
0.2
0.2
0.2
0.4
0.3
0.2
0.7
0.8
0.4
0.4
0.0
0.1
0.2
0.0
0.1
0.2
0.1
0.4
0.1
0.0
0.1
-0.1
-1.4
-0.7
-0.5
-0.4
-0.3
-0.3
0.0
0.1
0.0
-0.4
0.1
0.0
0.4
0.2
0.4
0.0
-0.1
-0.1
0.0
0.0
0.4
0.1
0.0
● Contribution of domestic intermediates mostly negative; imported
intermediates mostly positive
● Within durables, domestic and foreign intermediates both contribute
Results—sources of growth in manufacturing
Table 6
Sources of growth for U.S. manufacturing industries1
Gross
IT
Other
Purchased Domestic Inputs
Output
MFP
Capital2
Capital3
Labor
Other
Own
(1)
(2)
(3)
(4)
(5)
(6)
(7)
B. Difference in Annual Averages,
(2003 to 2005) vs. (1997 to 2002)
Durable goods:
1. Wood products
0.5
2. Nonmetallic mineral products
1.4
3. Primary metals
3.1
4. Fabricated metal products
-0.4
5. Machinery
6.1
6. Computer and electronic products
-0.4
7. Electrical equipment, appliances, and components1.6
8. Motor vehicles, bodies and trailers, and parts
-1.6
9. Other transportation equipment
2.1
10. Furniture and related products
0.5
11. Miscellaneous manufacturing
-1.1
Nondurable goods:
12. Food and beverage and tobacco products
0.1
13. Textile mills and textile product mills
-1.7
14. Apparel and leather and allied products
1.3
15. Paper products
-0.7
16. Printing and related support activities
-1.4
17. Petroleum and coal products
-3.1
18. Chemical products
-0.8
19. Plastics and rubber products
-0.7
Purchased Foreign Inputs
Other
(8)
Own
(9)
0.6
0.9
0.0
2.4
2.7
-1.1
-0.1
-1.0
-0.2
3.3
2.2
0.0
-0.2
-0.1
-0.1
-0.4
-0.5
-0.1
-0.1
-0.3
-0.1
-0.1
-0.1
-0.3
-0.1
-0.2
-0.3
-0.3
-0.3
-0.2
-0.2
-0.3
-0.1
0.3
0.1
0.6
0.8
0.8
-0.2
-0.4
0.0
-0.7
-0.2
0.7
0.3
0.4
-0.1
-2.5
2.4
0.2
1.5
-0.8
2.5
-2.0
-2.7
-0.3
0.2
1.1
-0.8
0.1
-0.1
0.2
-0.4
0.1
-0.2
-0.5
0.1
0.3
1.0
0.0
0.8
0.9
0.6
0.5
0.9
-0.1
-0.3
-0.2
0.1
0.7
0.0
0.2
0.7
0.1
0.2
0.0
0.0
-0.2
0.4
3.1
1.0
3.3
2.4
-0.1
0.4
1.0
-0.1
-0.1
-0.1
-0.1
-0.2
0.0
-0.3
-0.1
-0.1
-0.2
-0.2
-0.1
-0.2
0.1
-0.2
-0.4
-0.2
-0.1
-1.3
-0.3
-0.3
0.0
-0.2
0.0
-0.4
-3.1
1.5
-3.3
-2.5
-0.3
-1.6
-1.4
0.5
-1.3
0.4
-0.5
-0.5
-0.9
0.5
-0.2
0.1
0.1
0.0
0.2
-0.1
-1.3
0.4
0.4
-0.1
-0.2
0.1
0.1
0.0
-0.7
0.2
0.0
● Contribution of domestic intermediates mostly negative; imported
intermediates mostly positive
● Within durables, domestic and foreign intermediates both contribute
● Acceleration in output growth highly correlated with acceleration in
imported intermediates
Results—sources of growth in manufacturing
Table 6
Sources of growth for U.S. manufacturing industries1
Gross
IT
Other
Purchased Domestic Inputs
Output
MFP
Capital2
Capital3
Labor
Other
Own
(1)
(2)
(3)
(4)
(5)
(6)
(7)
B. Difference in Annual Averages,
(2003 to 2005) vs. (1997 to 2002)
Durable goods:
1. Wood products
0.5
2. Nonmetallic mineral products
1.4
3. Primary metals
3.1
4. Fabricated metal products
-0.4
5. Machinery
6.1
6. Computer and electronic products
-0.4
7. Electrical equipment, appliances, and components1.6
8. Motor vehicles, bodies and trailers, and parts
-1.6
9. Other transportation equipment
2.1
10. Furniture and related products
0.5
11. Miscellaneous manufacturing
-1.1
Nondurable goods:
12. Food and beverage and tobacco products
0.1
13. Textile mills and textile product mills
-1.7
14. Apparel and leather and allied products
1.3
15. Paper products
-0.7
16. Printing and related support activities
-1.4
17. Petroleum and coal products
-3.1
18. Chemical products
-0.8
19. Plastics and rubber products
-0.7
Purchased Foreign Inputs
Other
(8)
Own
(9)
0.6
0.9
0.0
2.4
2.7
-1.1
-0.1
-1.0
-0.2
3.3
2.2
0.0
-0.2
-0.1
-0.1
-0.4
-0.5
-0.1
-0.1
-0.3
-0.1
-0.1
-0.1
-0.3
-0.1
-0.2
-0.3
-0.3
-0.3
-0.2
-0.2
-0.3
-0.1
0.3
0.1
0.6
0.8
0.8
-0.2
-0.4
0.0
-0.7
-0.2
0.7
0.3
0.4
-0.1
-2.5
2.4
0.2
1.5
-0.8
2.5
-2.0
-2.7
-0.3
0.2
1.1
-0.8
0.1
-0.1
0.2
-0.4
0.1
-0.2
-0.5
0.1
0.3
1.0
0.0
0.8
0.9
0.6
0.5
0.9
-0.1
-0.3
-0.2
0.1
0.7
0.0
0.2
0.7
0.1
0.2
0.0
0.0
-0.2
0.4
3.1
1.0
3.3
2.4
-0.1
0.4
1.0
-0.1
-0.1
-0.1
-0.1
-0.2
0.0
-0.3
-0.1
-0.1
-0.2
-0.2
-0.1
-0.2
0.1
-0.2
-0.4
-0.2
-0.1
-1.3
-0.3
-0.3
0.0
-0.2
0.0
-0.4
-3.1
1.5
-3.3
-2.5
-0.3
-1.6
-1.4
0.5
-1.3
0.4
-0.5
-0.5
-0.9
0.5
-0.2
0.1
0.1
0.0
0.2
-0.1
-1.3
0.4
0.4
-0.1
-0.2
0.1
0.1
0.0
-0.7
0.2
0.0
●Output growth remained elevated for computers due to contribution
from pickup in imported intermediates
Outsourcing, Productivity, and Employment
• Test basic relationship between foreign outsourcing &
– productivity growth
– employment growth
Yˆit    Outsourcingit  X it   it
• Outsourcingit is a measure of foreign outsourcing
– Growth in real outsourcing (own or other)
– Change in share of outsourcing (own or other)
• We find little significance in the relationship between
outsourcing growth and productivity growth
• There is a significant relationship between outsourcing
and employment growth
Conclusion
• Results 1997-2005
– 15 percent of US growth attributed to imported intermediates,
and accelerated
– 1/3 manufacturing growth from imported intermediates,
mostly in durables, and is accelerating
– We find link between employment growth and outsourcing
growth