More Than Half a Million Jobs Are at Risk Due to Unfair Trade in the U.S. Steel Industry

Earlier this week, I estimated that up to half million (583,600) U.S. jobs are at risk due to surging imports of unfairly traded steel. A recent post by blogger Tim Worstall suggests that the number can’t possibly be that large because the steel industry employs only 150,000 people. But this misses the point—the risk to the steel industry goes far beyond the steel companies themselves, and the workers they employ. It also includes workers in iron ore and coal mines, in other manufacturing industries that support steel production, as well as lawyers, accountants, managers and other workers who supply services to the steel industry. All these jobs, 583,600 in total, are threatened by the flood of steel imports.

Half of the 46 top steel companies in the world were government-owned, and they accounted for 38 percent of global production. Illegally dumped and subsidized steel products are stealing market share and jobs from domestic producers. Worstall claims that we should ignore unfair import competition because, “if we get cheaper steel then this makes us all richer.” He concludes that “the market price is the fair price” for imports.

Responding to a similar question from a reporter this week, Ohio Senator Sherrod Brown said that this is “like arguing it’s OK to buy stolen TVs because they are cheaper.” Even a market economy needs rules to prevent cheating and unfair trade.

Worstall claims that we performed “some very heroic calculations” in estimating the jobs at risk due to unfair imports. He goes on to claim that “what is being done here is to assume that… steel workers buy restaurant meals so waiters are employed…and so on.” But this is exactly what we did not do.

Our model used standard data from the Bureau of Labor Statistics to estimate the direct and indirect jobs supported by U.S. steel production. Indirect jobs include those in production of “input commodities such as minerals and ore, coke, and other fuels, as well as downstream services and other resources consumed in the production of and distribution of steel products.” Furthermore, we very clearly stated that our estimate did “not include respending jobs supported by the wages of workers in the steel industry.”

The direct and indirect jobs at risk were fully disclosed in several tables. They are summarized in the table below, which is drawn from Table 6 of my study. We estimated that in 2012, U.S. steel production supported 123,400 direct jobs in the steel industries, and 460,200 indirect jobs in supplier industries.

Table 1

U.S. jobs supported by U.S. steel production, 2012

Jobs affected* Jobs supported by domestic production
Direct 123,400
Indirect 460,200
Total 583,600

*Jobs can be affected directly (in the immediate industry) and indirectly (industries that supply goods and services to industry of interest).

Sources: Economic Policy Institute analysis of U.S. Census Bureau (2013), Bureau of Labor Statistics (BLS 2013), and BLS Employment Projections program (BLS-EP 2014b and 2014c)

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Apparently, Worstall assumed that his readers would not bother to read our report. His blog post did not even bother to include a link to my report, nor to the EPI website, where I work. In fact, at one point he claims that our report was published by the “Employment Policy Institute,” a front group for a corporate PR firm that, ironically, works to discredit our research.

Jobs supported by steel production, both directly and in the industries supported by steel in other mining, manufacturing, law, accounting, management and other service industries are highly paid with good wages. Six years after the start of the Great Recession, in an economy that still needs 7.1 million jobs to eliminate excess unemployment, we cannot afford to stand idly by and let unfair import competition put the U.S. steel industry, and the half-million good jobs it supports, at risk.