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3. Fear of job loss
Tariffs tend to discourage job outsourcing by keeping product price competitive. Tariff-free
imports from lower-wage nations cost less. While this appears to be helpful for consumers, it
makes it difficult for local businesses to compete, causing them to decrease their staff. Indeed, one
of the primary criticisms of NAFTA was that it outsourced American employment to Mexico.
For decades, the American people have been outraged by free trade accords, fearing job loss to
foreign countries with cheaper labor. However, proponents of free trade argue that such accords
benefit the economy on both sides. The World Trade Organization agrees that free trade does result
in job losses. At the 2017 World Economic Forum in Davos, Switzerland, WTO Director-General
Roberto Azevêdo stated: "Trade is responsible for two out of every ten job losses. The other eight
are lost not because of free trade, but as a result of new technology, innovation, and increased
productivity." Though Azevêdo argued that other causes account for 80 percent of worldwide job
losses, it's worth noting that the director of the world's most vocal proponent of free trade
acknowledged that free trade is responsible for 20 percent of global employment losses. That
would be a powerful case against free trade, not in favor of it. Furthermore, New York Times
columnist Paul Krugman contends that free trade agreements with nations such as Korea and
Colombia are not "job development policies." This is hardly a rousing endorsement of free trade.
It does not necessarily follow that free trade will result in employment losses in the aggregate. It
may result in employment losses in a particular sector of a country's economy or job transfers from
one country to another. In addition, jobs or resources would be transferred from one industry to
another, with no overall job loss in the long run. An example would be the robust textile industry
in New England in the nineteenth century, which had totally vanished by the middle of the
twentieth century, with textile manufacturers either going out of business, migrating to the
southern states, or losing market share to cheaper products created elsewhere.
4. Adverse working conditions
pay the price when this free trade argument remains.
