The House Rules Committee advanced three proposals Wednesday that may help curb a growing problem for the nation’s economy: stagnant job growth in the technology sector.
The three pending free trade agreements with Columbia, Panama and Korea are up for full House approval next week. Senate Republican Minority Leader Mitch McConnell (R-KY) also said that the Senate will vote on the agreements next week as well.
115, 800 U.S. hi-tech industry jobs were lost in 2010-the second straight year of decline for the industry- according to a report released by TechAmerica Foundation today. Bloomberg Businessweek reported the findings by TechAmerica Foundation’s annual report, based on data by the U.S. Bureau of Labor Statistics.
The approved free trade agreements would increase the export of American goods, including those of the hi-tech sector. According to data from the World Bank, the U.S. exported $141,518,550,520 in high-technology goods in 2009, ranking third in the world behind China and Germany, respectively, and ahead of Korea.
U.S. information and communications technology exports to Korea accounted for $8.7 billion 2008 to 2010 on average, according to the U.S. Department of Commerce. Improved access to the South Korean market through the Korea-US Free Trade Agreement (KORUS FTA) is a necessary concern to analysts in Washington.
“South Korea will continue to open its dynamic market; the question is whether U.S. or foreign companies will benefit,” said Bruce Klinger, Senior Research Fellow for Northeast Asia in the Asian Studies Center at The Heritage Foundation. “The United States has already lost $40 billion in lost exports as Washington dithered on the KORUS FTA. Without KORUS, U.S. businesses would remain even more disadvantaged against EU competitors.”
KORUS FTA specifically would also guarantee fair play for US telecommunications companies operating in Korea, e-commerce and the protection of intellectual property rights. The U.S. Panama Trade Promotion Agreement (TPA) also includes provisions for telecommunications and electronic commerce.
Congressional approval of the U.S. Columbia Trade Promotion Agreement (CTPA) would open Colombia’s $134 billion services market to highly competitive American companies and increase U.S. Gross Domestic Product by nearly $2.5 billion, according to estimates by the U.S. International Trade Commission.
Trade agreements benefiting the U.S. tech industry couldn’t have come at a more timely moment. Of the four high—tech sectors highlighted by the TechAmerica report, only software services added jobs in 2010 noted Robert F. Bennett, Chairman of TechAmerica Foundation, in a statement about the tech sector findings. The software services sector added 22,800 jobs, culminating in a one percent gain between 2009 and 2010.
“Of the jobs lost, 72,100 were in communications services, 53,600 were in tech manufacturing, and 12,900 were in engineering and tech services,” said Bennett. “Fortunately, the initial numbers for 2011 look more promising in terms of job growth.”
In light of the employment trends of the past several years, the initial 2011 numbers might look promising to Bennett and the US-based trade association. Heritage, on the other hand, noted that unemployment still remains high under current trends.
“Job creation in the first six months of the year was barely enough to keep pace with population growth,” said William Beach, Director of the Center for Data Analysis at The Heritage Foundation, in a July 2011 interview. “If the economy immediately began creating jobs at the pace it did in the 2003-2007 expansion (+176,000 jobs/month) then unemployment would not return to its natural rate (5.2 percent) until mid-2018.”