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Offshoring: New Perspective on a Policy Issue. Loren Yager, Ph.D. Director, International Affairs and Trade U.S. GAO. Offshoring: Looking Back to 2004 . Significant political issue in 2004 campaign widespread congressional interest scale and nature of change not understood
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Offshoring: New Perspective on a Policy Issue Loren Yager, Ph.D. Director, International Affairs and Trade U.S. GAO
Offshoring: Looking Back to 2004 Significant political issue in 2004 campaign • widespread congressional interest • scale and nature of change not understood Goals of 2004 GAO report • define offshoring • examine available data
A Framework for Discussion:Linking Key Concepts to Available Data U.S. foreign direct investment Imports of services U.S. employment displaced
Narrow Definition of ‘Offshoring’:Displacement and Imports U.S. foreign direct investment Imports of services Firms import services from foreign suppliers, displacing U.S. employment Firms import services from their foreign affiliates, displacing U.S. employment U.S. employment displaced
Broad Definition of ‘Offshoring’:Other Combinations U.S. foreign affiliates produce services for foreign markets Firmsimport services from their foreign affiliates Firms import services from foreign suppliers U.S. foreign affiliates displace U.S. exports or services in foreign markets U.S. Employment displaced for reasons other than offshoring
Available Data: Imports of Services U.S. foreign direct investment Imports of services U.S. employment displaced
Imports of Services:Trends in Key BPT Categories Includes imports from unaffiliated firms
Available Data:U.S. Foreign Direct Investment U.S. Foreign Direct Investment Imports of Services U.S. employment displaced U.S. employment displaced
U.S. Foreign Direct Investment:Share of Subsidiary Sales to U.S., 2005 Majority owned service firms
Available Data:U.S. Employment Displaced U.S. Foreign Direct Investment Imports of Services U.S. employment displaced
U.S. Employment Displaced:Trends in Employment, 2001 to 2008 Data from March 2001 to January 2008
Summary: Additional Years Provide Perspective Changes in economy create measurement challenges • available statistics don’t always capture trends • efforts needed to better define and measure Uncertainty surrounding trends significantly reduced • improved collection • additional years of data • modeling and estimation