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Study finds a fourth of US jobs are at risk of offshoring

U.S. News & World Report logo U.S. News & World Report 6 days ago Andrew Soergel

Researchers at Muncie, Indiana's Ball State University recently published an illuminating – and concerning – dive into expectations for the future health of the U.S. labor market in a paper titled "How Vulnerable Are American Communities to Automation, Trade and Urbanization?"

The answer: Pretty vulnerable.

Drawing on new and existing research focused on job movement and potential displacement in the U.S., the researchers indicated as many as 25 percent of American jobs could be offshored in the years ahead, at risk of replacement by foreign competition. And half of all low-skill jobs could eventually be automated, potentially displacing millions of U.S. workers.

"We do not wish to be alarmist. Both trade and automation related economic growth are hallmarks of a vibrant economy," they said. "The findings of direct and indirect impacts of displacement are not homogeneous across populations. The negative long-term impacts of displacement have been found to be worse for low-skilled, less-educated workers, who are likely to work in more vulnerable jobs."

The study goes on to profile specific communities that have essentially become trapped in an economically treacherous cycle, noting that a disproportionate percentage of business expansion and job growth in recent years has been enjoyed by only a small number of metropolitan areas. Since the recession that ended in 2009, researchers estimate "half the net establishment growth [or business formation] in the United States … occurred in just 0.64 percent of the more than 3,100 U.S. counties."

This has allowed some regions of the country to diversify their local workforces and limit exposure to automation and offshoring. But it has also generated a sort of "clustering" in which communities see wealth diminish as opportunities dry up. Those with the means and skillsets to find jobs elsewhere are more likely to move away, taking their skills and education with them. The low-skill opportunities left over in the wake of this population flight – like manufacturing and industrial positions – are often among the most at-risk of automation or displacement.

"[T]here is a great degree of regional variation in the risk of job losses due to offshoring and automation. There are clear clusters of high risk in the industrialized Midwest and in several urban places across the country," the report says. "Industrial structure, educational attainment and the degree of rurality all affect the potential employment risk of increased automation and trade-related job losses."

The Aleutians East Borough of Alaska was found to be the single highest-risk area for both offshorability and automation. But rural counties in Mississippi, Georgia, Indiana, Virginia and the Carolinas were all found to be particularly vulnerable to job displacement.

Communities Most At-Risk to Offshoring

  1. Aleutians East Borough, Alaska
  2. Pontotoc County, Mississippi
  3. Tippah County, Mississippi
  4. Roseau County, Minnesota
  5. LeGrange County, Indiana
  6. Los Alamos County, New Mexico
  7. Clinton County, Indiana
  8. DeKalb County, Tennessee
  9. Chickasaw County, Mississippi
  10. Kosciusko County, Indiana

Communities Most At-Risk to Automation

  1. Aleutians East Borough, Alaska
  2. Quitman County, Georgia
  3. Aleutians West Census Area, Alaska
  4. Buena Vista City, Virginia
  5. Chickasaw County, Mississippi
  6. Allendale County, South Carolina
  7. Tyrrell County, North Carolina
  8. Coosa County, Alabama
  9. LeGrange County, Indiana
  10. Murray County, Georgia

"These rankings will no doubt offer pause to many communities. Indeed, the authors work in a state that can claim four of the top 25 counties in the automation category, and seven of the top 25 counties in the offshorable category," the study says. "What this analysis does provide are maps of vulnerable places where people live and work. It is these places where job disruptions are most likely."

The results of this economic cluttering are multifaceted. Less affluent, rural communities are likely to continue to see labor market erosion without some sort of correction, which could ramp up perceived frustration with trade deals and technological advances among communities that feel as though they have not been heard. The authors theorize that "with broad job losses, red districts get redder, and blue districts get bluer," something they believe should be evident to "any observer of the 2016 presidential primaries."

And with such a divide cropping up in the midst of "one of the largest labor market expansions in history" since the Great Recession, the "less robust economic conditions" that likely lie ahead "offer a much more disquieting forecast," the report says.

"We cannot know the pace or depth of automation and offshoring, but it is clear that large swathes of the American economy are likely to face these changes," according to the report. "Moreover, the risk, especially of job automation, is concentrated across labor markets, income, and educational attainment levels."

Still, the report hardly suggests well-educated Americans with higher-paying jobs are completely out of the woods in terms of offshorability and automation. Computer programmers, actuaries, statisticians and film and video editors are all among the most at-risk for offshoring, while telemarketers, insurance underwriters, mathematical technicians and library technicians are all at risk of automation.

Among the "safest" jobs in terms of displacement, on the other hand, were recreational therapists, mental health and substance abuse social workers, audiologists and first-line supervisors of mechanics, installers and repairers.


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