U.S.-made products are losing market
share to imports across a wide range
of core industries in the United States,
according to a new study.
Among 114 product categories, U.S.-based
producers boosted their domestic market
share in only three categories between
1997 and 2005: heavy trucks and chassis,
computer storage devices, and computer
chips. Imports gained market share
in 111 categories.
The survey from the U.S. Business
and Industry Council, a nonprofit
group in Washington of small and midsize
manufacturers and a critic of U.S.
trade policy, used Census Bureau data.
The survey excluded inexpensive consumer
products found in Wal-Marts, Targets
and dollar stores. Toys, clothing,
sporting goods and other products
in those retail stores are typically
blamed for the soaring trade deficit.
Instead, the study focused on industrial
and engineered products, such as wireless
equipment, plumbing fixtures, tire
cord, navigation and guidance systems,
power boilers, and heat exchangers.
Alan Tonelson, a research fellow
at the council and author of the study,
said yesterday that the study showed
that the United States "is failing
to pass the test of global competition."
He said the country appeared to no
longer be a place where many manufacturers
want to invest in advanced factories.
A spokesman for the National Association
of Manufacturers, the main trade group
for manufacturing companies, said
yesterday that there was a "mixed
picture" for U.S. manufacturers
and dismissed Tonelson's study as
too pessimistic. "Manufacturing
is still the heart and soul of the
U.S. economy," spokesman Hank
Cox said. U.S. manufacturers are losing
market share, but the entire market
is growing, allowing them to expand,
Cox said.
"To be sure, U.S. manufacturing
companies have a lot of problems,"
Cox said. "But to have Alan Tonelson
and Lou Dobbs running around waving
a bloody shirt, saying 'we've been
sold down the river' does not help."
Dobbs, a CNN commentator, has criticized
U.S. trade policy.
The last recession pounded the manufacturing
sector, causing it to shed about three
million jobs. Profits at U.S. manufacturing
companies have rebounded modestly
in recent years. But job losses from
earlier in the decade appear permanent,
as factory employment has remained
stuck at 14.3 million to 14.4 million
since mid-2003.
"The reality is that until there
is a change in the trade situation,
there won't be new manufacturing jobs,"
said Daniel Meckstroth, chief economist
with the Manufacturers Alliance, a
nonprofit educational and business-research
organization. The group is free-trade-oriented.
Meckstroth said the number of U.S.
factories declined every year between
1997 and 2005, falling to 334,700
from 374,600. Meckstroth said he expected
the factory level to stabilize this
year. He said the nation's trade deficit
as a share of the economy, now at
about 6 percent, is unsustainable.
Many economists have said a weaker
dollar might help manufacturing companies.
But Tonelson said he believed import
penetration rates would keep rising
even when the U.S. dollar was weak.
"Anyone who thinks that a major
U.S. devaluation will be a cure-all
for U.S. manufacturing is really kidding
themselves," he said.
Tonelson also said it was unlikely
that U.S.-made products were capturing
a higher share of foreign markets,
which would offset losses at home.
"It does not make sense to suppose
that U.S. products are doing better
in foreign markets than in their home
U.S. market," Tonelson said.