Impact of international trade on employment: evidence from Australian manufacturing industries

Date published:
1 April 2015

This staff research paper investigates the nature of the relationship between import competition and manufacturing sector employment within Australia.

Manufacturing employment in Australia has been on a long-run declining trend over the past four decades. It is a widely held view that import competition, especially from low wage countries, is an important factor driving this trend.

The research finds that low-wage countries have significantly increased their collective share of Australia’s imports of manufactured goods.

The results also indicate:

  • manufactured imports have a statistically significant negative relationship with manufacturing employment
  • exports have the opposite effect
  • trade's role in employment determination has waned over time

Author: Razib Tuhin