Outsourcing, Demand and Employment Loss in U.S. Manufacturing, 1990 – 2005

Burke, Oh, and Epstein focus on new measures of foreign outsourcing to track changes in the offshoring of manufacturing activity and to explore how offshoring along with other factors are related to the dramatic dislocation of workers in the US manufacturing sector in recent years. They present past studies that have explored the impact on workers of growing offshoring in manufacturing industries, introduce a new measure of imported inputs, and examine the growth of foreign outsourcing activity in manufacturing industries from 1987 to 2002. The authors present a counterfactual analysis as a way to show the loss of manufacturing industry employment resulting from rising foreign outsourcing between 1987 and 2005, and then explore the effect of foreign outsourcing on employment in US manufacturing industries for the period 1990 to 2005 using a regression analysis of industry data.