The winners and losers of globalization

The advantages of globalization are actually much like the advantages of technological improvement. But, as we've always known, and this is true again with technology, there are always some winners and losers, the chief economist of the International Monetary Fund (IMF) tells the World Economic Forum.

We hear a lot about how companies are closing plants and sending jobs overseas where workers toil longer and harder for less pay. But coupled together with technology and the Fourth Industrial Revolution, can globalization actually be a force for good in the workplace?

Gita Gopinath headshot
Gita Gopinath (Credit: Wikimedia Commons)

Gita Gopinath, Chief Economist of the International Monetary Fund, tells the World Economic Forum (WEF), “If you frame the question as, has international trade been good for the manufacturing worker in the U.S.? Then the answer to that would be ‘not fully’; it’s been very costly in terms of jobs and wages for them.”

As with any economic policy, Gopinath details the winners and losers. Overseas, jobs are created and wages are raised. In the United States and worldwide, consumers benefit from lower-priced goods. Clearly, the displaced workers from the manufacturing sector are losers.

Moving forward, she tells WEF, “If we want to make sure that the next wave of globalization is even more successful, it has to be complemented with good, sound domestic policies that help those who are getting left out.”

Over the past year, lawmakers have been working to do just that.

Last year, President Donald Trump signed bi-partisan legislation renewing the Carl D. Perkins Career and Technical Education Act. The bill will send $1.2 billion a year to states to help an estimated 11 million students and workers get better access to training for today’s in-demand jobs.

This year, U.S. Senators Tim Kaine (D-VA) and Rob Portman (R-OH) re-introduced their 2017, Jumpstart Our Businesses By Supporting Students (JOBS) Act that would help close the “skills gap” by expanding Pell Grant eligibility to cover high-quality and rigorous short-term job training programs so workers can afford the skills training and credentials that are in high demand in today’s job market.

MORE: Discovering the value of work-based learning opportunities

Since our inception, WorkingNation has been explaining that one of the key components driving structural unemployment and the skills gap is the globalization of the economy. Our short film, Slope of the Curve, explains the effects in detail.

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