(Extract from Employment, Wages, and Foreign Trade)

A STUDY SUBMITTED BY THE DEPARTMENT OF LABOR TO THE SUBCOMMITTEE ON FOREIGN TRADE POLICY OF THE HOUSE COMMITTEE ON WAYS AND MEANS IN SEPTEMBER 1957 1

INTERNATIONAL TRADE AND DOMESTIC EMPLOYMENT

The most recent analysis of the effects of United States foreign trade upon domestic employment was made by the Department of Labor for the Commission on Foreign Economic Policy (the Randall Commission) and was published in the staff papers of that Commission. This study indicated that in 1952 approximately 4 million workers in the United States owed their jobs either to making goods for export, processing imported raw materials and semimanufactured goods, or transporting and distributing imported commodities. On the basis of the growth in foreign trade which has occurred since 1952, the [Labor] Department now estimates that in 1956, this number had increased to about 41⁄2 million workers: United States employment attributable to foreign trade in 1956

A comparison of the components of the 1956 estimate with that for 1952 indicates that there was an increase of over 360,000 workers in making manufactured goods for export and over 130,000 workers in handling and processing of imports. This total gain of almost half a million workers has been partially offset by a drop of 265,000 agricultural workers, leaving a net gain of approximately 225,000 jobs in the 4-year period. The decrease in agricultural employment reflects both the increase in productivity of farm labor and the shifts in the pattern of agricultural exports among individual commodities.

Senator KERR. In your statement you give us some specifics of percentage of the Nation's output in certain fields that have been exported.

Based on the information you have and the charts you have shown, what percentage of that is related directly or made possible in part or entirely by our foreign aid program?

Secretary WEEKS. The large chart, the exports of finished manufactures, the exports represented by the red line on the right, they have no Government participation in any way, shape, or manner.

Now, in the separate industry charts, Mr. Blackwell, can you answer the question, are they also completely free from

Mr. BLACKWELL. No, sir; the separate industry charts contain the total exports in each case.

Secretary WEEKS. But the difference in total would be between 8 billion on this chart and on the block charts it is about 10 billion. Mr. BLACKWELL. Ten and a half billion.

Secretary WEEKS. So that you might-8 billion is finished manufactures-hold that up for a minute-is without Government participation, and last year on the block chart it shows sales. Put your block chart up there.

Senator KERR. Put it back up there.

Published in the Compendium of Papers on United States Foreign Trade Policy for the use of the Subcommittee on Foreign Trade Policy of the House Committee on Ways and Means, p. 761 (1957).

* Staff papers of the Commission on Foreign Economic Policy, U. S. Government Printing Office, February 1954, pp. 373, 374. As originally published, the estimate was 4.4 million workers, but the estimate of agricultural workers was later revised.

Secretary WEEKS. It shows sales of 10,400 million.

The difference is roughly $2 billion.

Senator KERR. I am trying to reconcile that twenty-six-billionsomething total there with your statement on page 2; 1957 was our peak trading year to date with exports of manufactures, raw materials, and foodstuffs totaling $19 billion.

Secretary WEEKS. That is the two lower blocks on the left-hand side marked "Goods."

Senator KERR. I am still trying to get in my own mind a clear picture of what that freight, travel, other services, and investment income means.

Secretary WEEKS. We sell goods and services, and the goods total

Senator KERR. Well, do you sell goods that are not manufactured? Secretary WEEKS. Oh, yes; semimanufactured and raw materials and foodstuffs

Senator KERR. No; they are neither foodstuffs nor raw materials. That blue there

Secretary WEEKS. That blue there, the services you sell. They are we buy freight, or sell freight services, our travel abroad and in this country.

Senator KERR. What freight services, Mr. Secretary?

I am not disputing it but I am just trying to understand it.

Secretary WEEKS. Well, ocean freight charges, one way and another, what they would charge us for carrying products of the foreigner for carrying goods, their goods, in our own bottoms.

That would be the freight, ocean freight.

Travel involves the travel of our people abroad

Senator KERR. That would not be an export, would it?

Secretary WEEKS. That is what they paid us on this side. The travel is what we pay them, part of that 4,900 million.

Senator KERR. You mean we have more tourists from them than they have from us?

Secretary WEEKS. Oh, yes. We had nearly $2 billion of tourism. Mr. BLACKWELL. No, sir, not just on tourism. We pay more in tourism alone than they do. But this includes all of the other invisible services, the blue bar.

Secretary WEEKS. But on tourism alone our people spend much more abroad than their people spend in this country.

Mr. BLACK WELL. Yes.

Senator KERR. That is what I thought, yet the freight travel and other services and investment of our exports is nearlySecretary WEEKS. It is six billion, nine.

Senator KERR. And yet we have a lot more people over there than we have over here.

Secretary WEEKS. Yes, but investment income on the left-hand side, what they owe us is a substantial item servicing private investments and so on.

Senator KERR. There is not any way in the world for them to get a dollar to spend over here unless we buy a dollar's worth from them, loan them a dollar or give them a dollar, is there?

Secretary WEEKS. That is just as true as that-will you put up that first chart again?

It shows for 40 years