Économie et Statistique n° 427-428 Internationalisation anf employment flows - The impact of tax exemption on business creation and employment in rural France - Commentary - Tax abatment and tax credit for hiring domestic workers - Are tax incentives for donations efficient? - Commentary
Globalisation and employment flows: what can an accounting-based approach tell us?
The effects of internationalisation on employment can be examined from two angles. The first approach considers the effects on total employment. It requires us to take account of the fact that internationalisation causes both job destruction and job creation, as the net balance of the two is what matters at macroeconomic level. The other approach concentrates solely on destruction, i.e., the aspect of the phenomenon actually experienced by the employees concerned. This destruction component is the focus of our article. One assessment often cited is that of Aubert and Sillard (2005). Analysing microeconomic business data, they estimated annual job losses in France at about 15,000. While significant, this figure is restricted to the manufacturing industry and captures only a portion of what is often understood by relocation of production capacity. Here, we examine an alternative estimate based on national-accounting data broken down by industry. Although our assessment draws on the “job content” model of international trade flows, we avoid its main drawbacks by applying the model to job flows rather than job stocks. For the period 2000-2005, we find that internationalisation caused an average 36,000 job losses a year, with wide variations reflecting phases of the economic cycle. However, our estimate is dependent on a certain number of conventions and, by nature, it applies to only one of the two facets of internationalisation, since it does not evaluate the job gains that offset the losses.