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Adjustment in local labor markets is remarkably slow, with wages and labor-force participation rates remaining depressed and unemployment rates remaining elevated for at least a full decade after the China trade shock commences. Exposed workers experience greater job churning and reduced lifetime income. At the national level, employment has fallen in U.S. industries more exposed to import competition…but offsetting employment gains in other industries have yet to materialize.

Autor, et al. show powerful evidence that industries and regions that have been more exposed to Chinese import competition since 2000 — the year China joined the World Trade Organization — have been hit hard and have not recovered. Workers in these industries and regions don’t go on to better jobs, or even similar jobs in different industries. Instead, they shuffle from low-paid job to low-paid job, never recovering the prosperity they had before Chinese competition hit. Many of them end up on welfare. This is very different from earlier decades, when workers who lost their jobs to import competition usually went into higher-productivity industries, to the benefit of almost everyone.

Efficiency says nothing about fairness, and almost any model of trade will show that some people, industries and regions lose out.

In other words, the public might have been wrong about free trade in the 1980s and 1990s, but things have changed. Popular opinion seems to be exactly right about the effect of trade with China — it has killed jobs and damaged the lives of many, many Americans. Economists may blithely declare that free trade is wonderful, but our best researchers have now shown that public misgivings about these smooth assurances have been completely justified.

Why are economists so willing to declare to the world that free trade is good, even after reading papers like the one by Autor et al.? Part of the problem is the definition of “good.” According to most models of trade, reducing trade barriers raises efficiency — which is to say, total gross domestic product. But efficiency says nothing about fairness, and almost any model of trade will show that some people, industries and regions lose out. If most Americans experience slight gains from lower import prices, and a few lose their livelihoods and have to go on welfare, economists call that a “good” outcome, because they are so focused on the concept of efficiency. But because the public cares about a lot more than efficiency, the job losses in industries and regions knocked out by China since 2000 have made economists seem increasingly callous and out of touch.