Why Trade Policies Are a Matter of Racial Equity

July 22, 2021 Groundwork Collaborative

By Grace Western

It’s no secret that trade policies in the United States have been captured by wealthy, corporate interests that prioritize growing their power and profits at the expense of working people. For generations, working people have seen their jobs, wages, and the promise of economic security disappear. While many workers across the country have experienced the devastating effects of failed U.S. trade policies, these policies have disproportionately harmed Black workers and communities who were already facing a labor market meant to exclude, exploit, and fail them. Ultimately, trade policies that harm marginalized communities are a liability for our economy as a whole.

New research from Howard University and Groundwork Collaborative delivers the data on what Black workers already know: the economic picture is worse for them by design. Black workers are losing jobs in industries exposed to trade shocks — think manufacturing jobs — and being crowded out of the next-highest-paying sectors, like jobs in the information sector, such as data processing. With Black workers being shut out of higher-paying sectors, the research also finds that our trade policies have led to a decline in the overall share of Black employment, specifically, a 32.4 percentage point drop in the Black share of employment in the exposed sector (like manufacturing). And the researchers find overall Black employment is reduced by 3.2 percentage points and Black earnings in the exposed sector are reduced by 3.84 percentage points for every percentage point increase in import exposure. 

These results are devastating in their own right, but coupled with a labor market that is designed to exclude, exploit, and fail marginalized communities, they paint an even more grim picture for the economic security of Black workers and communities. Chattel slavery served as a foundation for the U.S. economy, which built a labor market on the extraction and exploitation of enslaved Black labor, and still has profound ramifications today. From designing a labor market to exclude Black workers — and in particular, Black women — from worker protections and livable wages, to occupational segregation, to intentional policy choices that have led to Black unemployment levels being double that of white workers, the U.S. has all but ensured that Black people and communities have few, if any, viable ways to survive in our current economic paradigm. 

Historically, the manufacturing sector has been a pivotal access point to economic security for Black communities in an otherwise exclusive labor market. The sector — which traditionally has been heavily unionized — provided better economic opportunities, higher wages, and better working conditions than other employment options. As manufacturing jobs dwindled, in part due to trade policies skewed against workers, Black workers lost access to one of their few avenues to well-paid, stable jobs. Even worse, their overall employment levels suffered. Out of work manufacturing workers looked for commensurate jobs —the next highest paying jobs — only to be pushed into lower-wage work or out of the workforce altogether.

Ultimately, when we let corrosive concentrations of corporate power skew the U.S. trade agenda, we end up with policies that prioritize corporate power and profit over working people. When these trade policies are coupled with longstanding systemic racism and sexism in the labor market, the devastation Black workers are facing in the manufacturing sector and beyond is no surprise. 

But there is hope. The path forward for trade policy can and must prioritize building worker power, and strengthening labor and environmental standards domestically and globally. These policies must center Black workers who face a labor market designed to fail them. Furthermore, we must build toward a more equitable labor market, while also creating a new vision for trade. Without these changes, people already at the greatest disadvantage in our economy will continue to be harmed to the detriment of the economy writ large.

Originally posted on inequality.org