# ANALYSIS OF EMPLOYMENT CHANGES OVER TIME IN THE U.S. MOTOR VEHICLE INDUSTRY

## David Coffin Tamar Khachaturian David Riker

Working Paper 2016-08-A

U.S. INTERNATIONAL TRADE COMMISSION

500 E Street SW

Washington, DC 20436

## August 2016

Special thanks to Martha Lawless, Deborah McNay, James Stamps, and Ravinder Ubee for comments and assistance with this working paper.

Office of Economics working papers are the result of ongoing professional research of USITC Staff and are solely meant to represent the opinions and professional research of individual authors. These papers are not meant to represent in any way the views of the U.S. International Trade Commission or any of its individual Commissioners. Working papers are circulated to promote the active exchange of ideas between USITC Staff and recognized experts outside the USITC and to promote professional development of Office Staff by encouraging outside professional critique of staff research.

Analysis of Employment Changes over Time in the U.S. Motor Vehicle Industry

David Coffin, Tamar Khachaturian, and David Riker

Office of Economics Working Paper 2016-08-A

August 2016

# ABSTRACT

Over the period from 1997 to 2014, U.S. employment in the combined motor vehicle industry declined from 932,265 to 719,983 employees. During this time, significant changes in trade and non-trade factors occurred that have likely impacted employment, such as the value and composition of U.S. imports and exports and the intensified use of technology in manufacturing which increased labor productivity in some segments of the industry. This analysis decomposes the annual growth rates of employment in three separate segments of the combined motor vehicle industry into the contributions from international trade, labor productivity, and total U.S. consumption. Employment fell in both the motor vehicle and the parts manufacturing segments during this period. Labor productivity gains and increased imports both contributed to the employment declines, with labor productivity associated with a larger decline in employment. In both segments, higher domestic consumption played a larger role than increased exports in offsetting part of the employment declines. On the other hand, the vehicle body manufacturing segment posted an employment increase during this period. In this segment, employment gains from increased domestic consumption and exports offset the reductions in employment from gains in labor productivity.

David Coffin

Office of Industries, Advanced Technology and Machinery Division

Tamar Khachaturian

Office of Industries, Services Division

David Riker

Office of Economics, Research Division

# Introduction

The expansion in international trade in motor vehicles has coincided with persistent declines in U.S. employment in the combined industry. Between 1997 and 2014, total U.S. imports of motor vehicles, bodies, and parts increased a cumulative 128.3 percent ($169 billion), and U.S. exports increased a cumulative 111.0 percent ($69 billion).[1] During the same time, employment declined a cumulative 22.8 percent, from 932,265 to 719,983 employees (figure 1).

Figure 1. U.S. employment: motor vehicles, parts, and bodies (1997$– MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaqefmuyTjMCPf gaiuaajugGbabaaaaaaaaapeGaa83eGaaa@3A8C@$2014)

Source: U.S. Census, ASM (accessed July 1, 2016). Corresponds to table A.1 in the appendix.

While part of the change in industry employment is likely tied to the growth of international trade, it also reflects improvements in labor productivity in the industry and in total consumption of motor vehicles in the U.S. market. This research note uses a growth accounting framework to quantify the relative contributions of changes in trade, technology, and total consumption $– MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaqefmuyTjMCPf gaiuaajugybabaaaaaaaaapeGaa83eGaaa@3A6C@$ in some cases positive, in others negative $– MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaqefmuyTjMCPf gaiuaajugybabaaaaaaaaapeGaa83eGaaa@3A6C@$ to the historical declines in industry employment. An increase in consumption in the United States due to an increase in aggregate demand increases labor demand and therefore employment in the U.S. industry. Likewise, an increase in U.S. exports due to an increase in foreign demand increases employment in the U.S. industry. On the other hand, an increase in imports due to a reduction in foreign costs of production generally reduces employment in the U.S. industry. Finally, an increase in labor productivity in the United States could increase or reduce employment in the U.S. industry depending on the price sensitivity of the demand for the product.

# Segments of the U.S. Motor Vehicle Industry

The manufacture of U.S. motor vehicles in the United States is reported in NAICS codes 3361, 336211, and 3363.[2] NAICS code 3361 (motor vehicle manufacturing) encompasses the manufacturing of passenger vehicles, heavy trucks, and buses. NAICS code 336211 covers the manufacturing of vehicle bodies. NAICS code 3363 (motor vehicle parts manufacturing) covers manufacturing of major motor vehicle systems, but may not include all of the indirect inputs such as steel. Table 1 reports the relative size of these three distinct segments and their engagement in international trade.

Table 1. Statistics for the U.S. Motor Vehicle Industry, by Segment in 2014

 NAICS 3361 Motor Vehicle Manufacturing NAICS 336211 Motor Vehicle Body Manufacturing NAICS 3363 Motor Vehicle Parts Manufacturing Industry Employment (thousand) 176,001 42,917 501,065 Total Value of Shipments (million dollars) 307,269 13,225 244,688 Exports (million dollars) 72,797 452 53,180 Imports (million dollars) 190,764 784 106,487

Source: U.S. Census, ASM (accessed July 1, 2016); USITC DataWeb/USDOC (accessed July 1, 2016).

The data on the annual value of shipments and employment of the U.S. producers are from the Annual Survey of Manufactures and the Economic Census for 1997 through 2014. The data on the annual value of U.S. imports and exports are from the USITC’s Trade Dataweb. They are the landed duty-paid value of U.S. imports for consumption and the free alongside ship value of U.S. domestic exports of these industries from 1997 to 2014.

# Evolution of the U.S. Motor Vehicle Industry

This section provides a short discussion of trends in each of the components of the employment analysis: imports, exports, labor productivity, and domestic consumption. Then the following section quantifies the contribution of these trends to changes in industry employment.

Imports

U.S. imports of vehicles, parts, and bodies all increased significantly during the 1997$– MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaqefmuyTjMCPf gaiuaajugybabaaaaaaaaapeGaa83eGaaa@3A6C@$2014 period. On a percentage basis U.S. parts imports increased the most (202 percent) to over $106 billion, while the$95 billion increase in the absolute value of vehicle imports to nearly $191 billion in 2014 was greater than the other two NAICS codes (figure 2). U.S. imports of bodies are relatively insignificant because bodies are typically produced at the assembly plant by the vehicle manufacturer and are thus unlikely to cross borders.[3] Figure 2. U.S. imports of motor vehicles, parts, and bodies (1997$– MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaqefmuyTjMCPf gaiuaajugGbabaaaaaaaaapeGaa83eGaaa@3A8C@$2014) Source: USITC Dataweb (accessed July 12, 2016). Imports for consumption used. Corresponds to table A.2 in the appendix. The four largest sources for U.S. imports of motor vehicles, parts, and bodies in 2014 were Mexico, Canada, China, and Japan. Canada and Mexico, along with the United States, are part of North America’s integrated motor vehicle supply chain, with vehicles and parts traded freely between the three countries.[4] Mexico has become the leading supplier of parts and vehicles to the United States, rising from third largest in 1997. China is currently the third largest source of vehicle parts to the United States, supplying over$12 billion in 2014, compared to $300 million in 1997.[5] Japan is also a significant supplier of vehicles and parts to the United States. However, Japanese companies have invested heavily in Mexico and Canada in recent years, which have likely redirected supply to the United States to come from those countries rather than directly from Japan.[6] Exports U.S. exports of motor vehicles, parts, and bodies have increased significantly, from less than$61 billion in 1997 to more than $126 billion in 2014. U.S. exports of motor vehicles increased the most, growing from$24 billion in 1997 to $73 billion in 2014 (figure 3). Figure 3. U.S. exports of motor vehicles, parts, and bodies (1997$– MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaqefmuyTjMCPf gaiuaajugGbabaaaaaaaaapeGaa83eGaaa@3A8C@$2014) Source: USITC Dataweb (accessed July 12, 2016). Domestic exports used. Corresponds to table A.3 in the appendix. The four largest destinations for exports of products of vehicles, parts, and bodies in 2014 were Canada, Mexico, China, and Germany. Due to the integration of the North American supply chain discussed above, Canada and Mexico are also top destinations for U.S. exports. Canada is the leading U.S. market for these exports of all three categories, whereas Mexico is one of the top four destinations for all three categories. China, the world’s largest single-country vehicle market, is a major destination for U.S. vehicles and part exports, ranking as the second largest market for U.S. motor vehicle exports, and third largest for motor vehicle parts exports. Germany is the third largest U.S. market for motor vehicle exports, but U.S. exports of motor vehicle bodies and parts to Germany total less than$1 billion.

Consumption

Consumption of goods in this industry is primarily driven by macroeconomic trends. When the economy is growing, consumers purchase vehicles. When consumers purchase vehicles, manufacturers purchase parts. When consumers stop purchasing vehicles, manufacturers stop purchasing parts, as occurred during the economic downturn (figure 4).

Figure 4. U.S. consumption: motor vehicles, parts, and bodies (1997$– MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaqefmuyTjMCPf gaiuaajugGbabaaaaaaaaapeGaa83eGaaa@3A8C@$2014)

Source: U.S. Census, ASM and U.S. International Trade Commission Dataweb (accessed July 1, 2016). Note: Total consumption is measured as total shipments of the U.S. industry minus U.S. exports plus U.S. imports. Corresponds to table A.4 in the appendix.

Productivity

During the 1997$– MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaqefmuyTjMCPf gaiuaajugybabaaaaaaaaapeGaa83eGaaa@3A6C@$2014 period, labor productivity in all three industry segments increased (figure 5). Several factors have likely contributed to these improvements in productivity. First, there has been a rise in the use of technology$– MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaqefmuyTjMCPf gaiuaajugybabaaaaaaaaapeGaa83eGaaa@3A6C@$$– MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaqefmuyTjMCPf gaiuaajugybabaaaaaaaaapeGaa83eGaaa@3A6C@$including robotics, automation, and digital technologies$– MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaqefmuyTjMCPf gaiuaajugybabaaaaaaaaapeGaa83eGaaa@3A6C@$$– MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaqefmuyTjMCPf gaiuaajugybabaaaaaaaaapeGaa83eGaaa@3A6C@$ in the production of vehicles and parts. The motor vehicle industry is the top purchaser of industrial robots, and installations of industrial robots increased significantly between 2010 and 2014.[7] Further, many vehicle manufacturers upgraded assembly plants to be more flexible, allowing different vehicle models to be produced on the same assembly line.[8] This flexibility reduces the need for different plants for each specific model and helps manufacturers to redistribute assembly based on demand. Also, upgraded plants operating at higher production capacities were likely one of the factors in increased productivity. Finally, the closure of older plants reduced overall production capacity, but likely contributed to capacity utilization rising to 77 percent for all motor vehicle and parts manufacturing in 2014, a level not seen since the first quarter of 2005.[9] Productivity in the remaining plants was likely higher than those that were closed during the economic downturn.

Figure 5. U.S. labor productivity: motor vehicles, parts, and bodies (1997$– MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaqefmuyTjMCPf gaiuaajugGbabaaaaaaaaapeGaa83eGaaa@3A8C@$2014)

Source: U.S. Bureau of Labor Statistics, Labor Productivity and Costs Database. Corresponds to table A.5 in the appendix.

# Framework for Analyzing the Changes in Industry Employment

We model the average annual percent changes in industry employment as a combination of the percent changes in several components $– MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaqefmuyTjMCPf gaiuaajugybabaaaaaaaaapeGaa83eGaaa@3A6C@$ (1) labor productivity, (2) total U.S. consumption of the products of the industry, (3) U.S. exports of the products of the industry, and (4) the U.S. imports of these products $– MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaqefmuyTjMCPf gaiuaajugybabaaaaaaaaapeGaa83eGaaa@3A6C@$ based on a mathematical accounting relationship between the industry variables. The model quantifies the contributions of the components to the whole, based on the growth rates of the components and their initial size relative to total industry shipments.

Equation (1) defines the value of output per worker in segment in year $t MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVCI8FfYJH8YrFfeuY=Hhbbf9v8qqaqFr0xc9pk0xbb a9q8WqFfeaY=biLkVcLq=JHqpepeea0=as0Fb9pgeaYRXxe9vr0=vr 0=vqpWqaaeaabiGaciaacaqabeaadaqaaqaaaOqaaabaaaaaaaaape GaamiDaaaa@3705@$:

(1)

$L jt MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVCI8FfYJH8YrFfeuY=Hhbbf9v8qqaqFr0xc9pk0xbb a9q8WqFfeaY=biLkVcLq=JHqpepeea0=as0Fb9pgeaYRXxe9vr0=vr 0=vqpWqaaeaabiGaciaacaqabeaadaqaaqaaaOqaaabaaaaaaaaape Gaamita8aadaWgaaWcbaWdbiaadQgacaWG0baapaqabaaaaa@391F@$ is labor productivity, defined as physical output per worker, and $P jt MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVCI8FfYJH8YrFfeuY=Hhbbf9v8qqaqFr0xc9pk0xbb a9q8WqFfeaY=biLkVcLq=JHqpepeea0=as0Fb9pgeaYRXxe9vr0=vr 0=vqpWqaaeaabiGaciaacaqabeaadaqaaqaaaOqaaabaaaaaaaaape Gaamiua8aadaWgaaWcbaWdbiaadQgacaWG0baapaqabaaaaa@3923@$ is the price of the product. The numerator on the right-hand side of equation (1), U.S. exports plus total U.S. consumption $C jt MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVCI8FfYJH8YrFfeuY=Hhbbf9v8qqaqFr0xc9pk0xbb a9q8WqFfeaY=biLkVcLq=JHqpepeea0=as0Fb9pgeaYRXxe9vr0=vr 0=vqpWqaaeaabiGaciaacaqabeaadaqaaqaaaOqaaabaaaaaaaaape Gaam4qa8aadaWgaaWcbaWdbiaadQgacaWG0baapaqabaaaaa@3916@$ minus U.S. imports $M jt MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVCI8FfYJH8YrFfeuY=Hhbbf9v8qqaqFr0xc9pk0xbb a9q8WqFfeaY=biLkVcLq=JHqpepeea0=as0Fb9pgeaYRXxe9vr0=vr 0=vqpWqaaeaabiGaciaacaqabeaadaqaaqaaaOqaaabaaaaaaaaape Gaamyta8aadaWgaaWcbaWdbiaadQgacaWG0baapaqabaaaaa@3920@$, is equal to total shipments of the segment. $E jt MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVCI8FfYJH8YrFfeuY=Hhbbf9v8qqaqFr0xc9pk0xbb a9q8WqFfeaY=biLkVcLq=JHqpepeea0=as0Fb9pgeaYRXxe9vr0=vr 0=vqpWqaaeaabiGaciaacaqabeaadaqaaqaaaOqaaabaaaaaaaaape Gaamyra8aadaWgaaWcbaWdbiaadQgacaWG0baapaqabaaaaa@3918@$ is employment in the segment. Equation (1) implicitly defines the price index as a function of the other variables.

Equation (2) is an expression for employment in segment based on equation (1).
(2)

Equation (3) relates the percent changes in industry employment to the percent changes in the price-deflated values of the other variables, based on a log-linearization of equation (2).
$E ^ jt ≅( X j,t−1 V j,t−1 ) X ^ jt −( M j,t−1 V j,t−1 ) M ^ jt +( C j,t−1 V j,t−1 ) C ^ jt − L ^ jt MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVCI8FfYJH8YrFfeuY=Hhbbf9v8qqaqFr0xc9pk0xbb a9q8WqFfeaY=biLkVcLq=JHqpepeea0=as0Fb9pgeaYRXxe9vr0=vr 0=vqpWqaaeaabiGaciaacaqabeaadaqaaqaaaOqaaabaaaaaaaaape Gabmyra8aagaqcamaaBaaaleaapeGaamOAaiaadshaa8aabeaak8qa cqGHfjcqdaqadaWdaeaapeWaaSaaa8aabaWdbiaadIfapaWaaSbaaS qaa8qacaWGQbGaaiilaiaadshacqGHsislcaaIXaaapaqabaaakeaa peGaamOva8aadaWgaaWcbaWdbiaadQgacaGGSaGaamiDaiabgkHiTi aaigdaa8aabeaaaaaak8qacaGLOaGaayzkaaGabmiwa8aagaqcamaa BaaaleaapeGaamOAaiaadshaa8aabeaak8qacqGHsisldaqadaWdae aapeWaaSaaa8aabaWdbiaad2eapaWaaSbaaSqaa8qacaWGQbGaaiil aiaadshacqGHsislcaaIXaaapaqabaaakeaapeGaamOva8aadaWgaa WcbaWdbiaadQgacaGGSaGaamiDaiabgkHiTiaaigdaa8aabeaaaaaa k8qacaGLOaGaayzkaaGabmyta8aagaqcamaaBaaaleaapeGaamOAai aadshaa8aabeaak8qacqGHRaWkdaqadaWdaeaapeWaaSaaa8aabaWd biaadoeapaWaaSbaaSqaa8qacaWGQbGaaiilaiaadshacqGHsislca aIXaaapaqabaaakeaapeGaamOva8aadaWgaaWcbaWdbiaadQgacaGG SaGaamiDaiabgkHiTiaaigdaa8aabeaaaaaak8qacaGLOaGaayzkaa Gabm4qa8aagaqcamaaBaaaleaapeGaamOAaiaadshaa8aabeaak8qa cqGHsislceWGmbWdayaajaWaaSbaaSqaa8qacaWGQbGaamiDaaWdae qaaaaa@70D4@$ (3)

where $V j,t−1 = X j,t−1 + C j,t−1 − M j,t−1 MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVCI8FfYJH8YrFfeuY=Hhbbf9v8qqaqFr0xc9pk0xbb a9q8WqFfeaY=biLkVcLq=JHqpepeea0=as0Fb9pgeaYRXxe9vr0=vr 0=vqpWqaaeaabiGaciaacaqabeaadaqaaqaaaOqaaabaaaaaaaaape GaamOva8aadaWgaaWcbaWdbiaadQgacaGGSaGaamiDaiabgkHiTiaa igdaa8aabeaak8qacqGH9aqpcaWGybWdamaaBaaaleaapeGaamOAai aacYcacaWG0bGaeyOeI0IaaGymaaWdaeqaaOWdbiabgUcaRiaadoea paWaaSbaaSqaa8qacaWGQbGaaiilaiaadshacqGHsislcaaIXaaapa qabaGcpeGaeyOeI0Iaamyta8aadaWgaaWcbaWdbiaadQgacaGGSaGa amiDaiabgkHiTiaaigdaa8aabeaaaaa@4EE9@$ is the value of domestic shipments of segment $j MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVCI8FfYJH8YrFfeuY=Hhbbf9v8qqaqFr0xc9pk0xbb a9q8WqFfeaY=biLkVcLq=JHqpepeea0=as0Fb9pgeaYRXxe9vr0=vr 0=vqpWqaaeaabiGaciaacaqabeaadaqaaqaaaOqaaabaaaaaaaaape GaamOAaaaa@36FB@$ in year $t−1 MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVCI8FfYJH8YrFfeuY=Hhbbf9v8qqaqFr0xc9pk0xbb a9q8WqFfeaY=biLkVcLq=JHqpepeea0=as0Fb9pgeaYRXxe9vr0=vr 0=vqpWqaaeaabiGaciaacaqabeaadaqaaqaaaOqaaabaaaaaaaaape GaamiDaiabgkHiTiaaigdaaaa@38AD@$. $E ^ jt MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVCI8FfYJH8YrFfeuY=Hhbbf9v8qqaqFr0xc9pk0xbb a9q8WqFfeaY=biLkVcLq=JHqpepeea0=as0Fb9pgeaYRXxe9vr0=vr 0=vqpWqaaeaabiGaciaacaqabeaadaqaaqaaaOqaaabaaaaaaaaape Gabmyra8aagaqcamaaBaaaleaapeGaamOAaiaadshaa8aabeaaaaa@3928@$ represents the percent change in employment in segment from year $t−1 MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVCI8FfYJH8YrFfeuY=Hhbbf9v8qqaqFr0xc9pk0xbb a9q8WqFfeaY=biLkVcLq=JHqpepeea0=as0Fb9pgeaYRXxe9vr0=vr 0=vqpWqaaeaabiGaciaacaqabeaadaqaaqaaaOqaaabaaaaaaaaape GaamiDaiabgkHiTiaaigdaaaa@38AD@$ to year $t MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVCI8FfYJH8YrFfeuY=Hhbbf9v8qqaqFr0xc9pk0xbb a9q8WqFfeaY=biLkVcLq=JHqpepeea0=as0Fb9pgeaYRXxe9vr0=vr 0=vqpWqaaeaabiGaciaacaqabeaadaqaaqaaaOqaaabaaaaaaaaape GaamiDaaaa@3705@$, $E jt − E j,t−1 E j,t−1 MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVCI8FfYJH8YrFfeuY=Hhbbf9v8qqaqFr0xc9pk0xbb a9q8WqFfeaY=biLkVcLq=JHqpepeea0=as0Fb9pgeaYRXxe9vr0=vr 0=vqpWqaaeaabiGaciaacaqabeaadaqaaqaaaOqaaabaaaaaaaaape WaaSaaa8aabaWdbiaadweapaWaaSbaaSqaa8qacaWGQbGaamiDaaWd aeqaaOWdbiabgkHiTiaadweapaWaaSbaaSqaa8qacaWGQbGaaiilai aadshacqGHsislcaaIXaaapaqabaaakeaapeGaamyra8aadaWgaaWc baWdbiaadQgacaGGSaGaamiDaiabgkHiTiaaigdaa8aabeaaaaaaaa@4530@$. $X ^ jt MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVCI8FfYJH8YrFfeuY=Hhbbf9v8qqaqFr0xc9pk0xbb a9q8WqFfeaY=biLkVcLq=JHqpepeea0=as0Fb9pgeaYRXxe9vr0=vr 0=vqpWqaaeaabiGaciaacaqabeaadaqaaqaaaOqaaabaaaaaaaaape Gabmiwa8aagaqcamaaBaaaleaapeGaamOAaiaadshaa8aabeaaaaa@393B@$, $M ^ jt MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVCI8FfYJH8YrFfeuY=Hhbbf9v8qqaqFr0xc9pk0xbb a9q8WqFfeaY=biLkVcLq=JHqpepeea0=as0Fb9pgeaYRXxe9vr0=vr 0=vqpWqaaeaabiGaciaacaqabeaadaqaaqaaaOqaaabaaaaaaaaape Gabmyta8aagaqcamaaBaaaleaapeGaamOAaiaadshaa8aabeaaaaa@3930@$, $C ^ jt MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVCI8FfYJH8YrFfeuY=Hhbbf9v8qqaqFr0xc9pk0xbb a9q8WqFfeaY=biLkVcLq=JHqpepeea0=as0Fb9pgeaYRXxe9vr0=vr 0=vqpWqaaeaabiGaciaacaqabeaadaqaaqaaaOqaaabaaaaaaaaape Gabm4qa8aagaqcamaaBaaaleaapeGaamOAaiaadshaa8aabeaaaaa@3926@$, and $L ^ jt MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVCI8FfYJH8YrFfeuY=Hhbbf9v8qqaqFr0xc9pk0xbb a9q8WqFfeaY=biLkVcLq=JHqpepeea0=as0Fb9pgeaYRXxe9vr0=vr 0=vqpWqaaeaabiGaciaacaqabeaadaqaaqaaaOqaaabaaaaaaaaape Gabmita8aagaqcamaaBaaaleaapeGaamOAaiaadshaa8aabeaaaaa@392F@$ represent the percent changes in the other variables from year $t−1 MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVCI8FfYJH8YrFfeuY=Hhbbf9v8qqaqFr0xc9pk0xbb a9q8WqFfeaY=biLkVcLq=JHqpepeea0=as0Fb9pgeaYRXxe9vr0=vr 0=vqpWqaaeaabiGaciaacaqabeaadaqaaqaaaOqaaabaaaaaaaaape GaamiDaiabgkHiTiaaigdaaaa@38AD@$ to year $t MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVCI8FfYJH8YrFfeuY=Hhbbf9v8qqaqFr0xc9pk0xbb a9q8WqFfeaY=biLkVcLq=JHqpepeea0=as0Fb9pgeaYRXxe9vr0=vr 0=vqpWqaaeaabiGaciaacaqabeaadaqaaqaaaOqaaabaaaaaaaaape GaamiDaaaa@3705@$. The sum of the components on the right-hand side of equation (3) is approximately equal to the percent changes on the left-hand side of equation (3).[10]

Equation (3) is a decomposition of employment changes into changes in the component factors, and in this sense it is a quantification of the contribution of each factor. However, it is not an analysis of causation or a prediction of future effects.[11] The interpretation of the measured contribution of each factor is that it indicates how much employment would change if all other factors remained fixed, while the factor of interest changed by the historical amount.

# Estimated Contributions to Changes in Industry Employment

Table 2 reports the contribution of each of the factors to the year-to-year percent changes in employment in the three segments of the combined U.S. motor vehicle industry. For each of the contributing factors, the table reports the percentage change in employment due to the factor, rather than the percentage change in the factor.

Table 2. Analysis of Average Annual Growth Rates, 1997-2014

 NAICS 3361 Motor Vehicle Manufacturing NAICS 336211 Motor Vehicle Body Manufacturing NAICS 3363 Motor Vehicle Parts Manufacturing U.S. Industry Employment -1.4 0.3 -1.1 Contributing Factors U.S. Exports 1.2 0.0 0.7 U.S. Imports -2.9 0.0 -2.2 Total U.S. Consumption 4.9 2.5 4.2 U.S. Labor Productivity -4.4 -2.2 -4.0

Source: USITC calculations. The linear approximation error in these calculations is discussed in note 10.

Overall, there was a decline in employment in the motor vehicle and parts segments and a slight increase in employment in motor vehicle body manufacturing. In all three segments, there were negative contributions to employment associated with increases in labor productivity and imports, and there were positive contributions to employment associated with increases in exports and total consumption in the U.S. market.

According to Table 2, employment in the U.S. motor vehicle manufacturing segment (NAICS 3361) declined by 1.4 percent per year, on average, between 1997 and 2014. The increase in labor productivity would have resulted in a 4.4 percent average reduction in employment if all of the other factors had remained constant, while the increase in U.S. imports would have reduced employment by 2.9 percent. The negative employment effects of these two factors were partly offset by a significant increase in total U.S. consumption and a smaller increase in U.S. exports, for a net 1.4 percent reduction in employment.

On the other hand, employment in the U.S. motor vehicle body manufacturing segment (NAICS 336211) increased by 0.3 percent per year on average. The increase in labor productivity would have resulted in a 2.2 percent average reduction in employment if all of the other factors had remained constant. The increase in total U.S. consumption would have resulted in a 2.5 percent average increase in employment per year more than offsetting the negative effect of the increase in labor productivity, resulting in a net 0.3 percent increase in employment. U.S. imports and exports had a less significant impact on employment.

Finally, employment in the U.S. motor vehicle parts manufacturing segment (NAICS 3363) declined by 1.1 percent per year on average. The increase in labor productivity would have resulted in a 4.0 percent average reduction in employment if all of the other factors had remained constant, and the increase in imports would have reduced employment by an additional 2.2 percent. These two factors were partly offset by the increase in total U.S. consumption and the increase in exports, for a net 1.1 percent reduction in employment.

# Conclusions

The employment changes in the U.S. motor vehicle industry between 1997 and 2014 reflect several trade and non-trade factors: there were negative contributions from increases in labor productivity and imports and positive contributions from increases in total consumption and exports. The growth accounting framework in this research note provides a simple method for quantifying the relative contributions of these factors using available industry data.[12]

When we split the motor vehicle manufacturing industries into three segments, we find that the relative contributions of the trade and non-trade factors are quite different, and this is ultimately reflected in the different historical changes in employment levels in the segments. While labor productivity and imports contributed to employment declines in motor vehicle and parts manufacturing, there were larger impacts from changes in labor productivity. This is notable since China's accession to the WTO as well as NAFTA and additional U.S. trade agreements were implemented over the time period, which likely accelerated the growth of U.S. imports and exports in these industries. However, trade appeared to play a less significant role in employment declines than the increased use of technology and other factors that increased labor productivity. In all three industries, increased domestic consumption played a larger role than exports in offsetting (partially in motor vehicle and parts manufacturing and completely in body manufacturing) employment reductions that are associated with increases in labor productivity and imports.

# References

Boudette, Neal. “Production capacity balloons, but today's industry can support it.” Automotive News, May 18, 2015. https://www.autonews.com/article/20150518/OEM01/305189955/production-capacity-balloons-but-todays-industry-can-support-it.

Coffin, David. Passenger Vehicles. Industry and Trade Summary. Publication ITS-09. Washington, DC: U.S. International Trade Commission, May 2013.

Federal Reserve, G.17 Industrial Product ion and Capacity Utilization, June 15, 2016. https://www.federalreserve.gov/releases/G17/default.htm.

International Federation of Robotics. “Industrial Robot Statistics.” 2015. https://www.ifr.org/industrial-robots/statistics/.

Klier, Thomas H. and James Rubenstein. “Detroit back from the brink?” Economic Perspectives, 2Q 2012, 49.

Klier, Thomas, and James Rubenstein. Who Really Makes Your Car? Kalamazoo: W.E. Upjohn Institute for Employment Research, 2008.

Mercedes Benz U.S. International (MBUSI). “About Mercedes-Benz U.S. International.” https://www.mbusi.com/factory.

Motor & Equipment Manufacturers Association (MEMA). “Restoring Credit to Manufacturers.” Senate Committee on Banking, Housing, and Urban Affairs, Economic Policy Subcommittee, October 9, 2009. https://www.banking.senate.gov/public/?a=Files.Serve&File_id=E4610997-7941-4358-8B4B-1B4C89C7E42C.

Rauwald, Christoph. “BMWs Made in America Surging as Biggest Auto Export.” July 10, 2014. https://www.bloomberg.com/news/articles/2014-07-10/bmws-made-in-america-surging-as-biggest-auto-export-cars.

U.S. Bureau of the Census (U.S. Census). “Annual Survey of Manufactures.” Historical Data tables. https://www.census.gov/manufacturing/asm/historical_data (accessed July 1, 2016).

U.S. International Trade Commission (USITC). Interactive Tariff and Trade DataWeb (DataWeb). https://dataweb.usitc.gov (accessed various dates).

U.S. International Trade Commission. Economic Impact of Trade Agreements Implemented Under Trade Authorities Procedures, 2016 Report. Inv. No. 332-555. Publication 4614. June 2016.

# Appendix Tables

Table A1. Data for Figure 1

 Year NAICS 3361 Motor Vehicle Manufacturing NAICS 336211 Motor Vehicle Body Manufacturing NAICS 3363 Motor Vehicle Parts Manufacturing 1997 236,247 42,773 653,245 1998 234,960 43,306 789,565 1999 233,053 43,170 799,174 2000 230,544 43,844 802,575 2001 213,761 41,254 732,704 2002 219,243 41,450 721,655 2003 210,387 40,874 671,990 2004 215,852 43,779 644,848 2005 204,065 48,342 612,872 2006 205,843 50,906 577,729 2007 179,885 49,165 580,845 2008 156,251 46,002 526,672 2009 124,792 37,561 397,277 2010 137,284 35,891 388,920 2011 148,009 37,665 404,636 2012 157,217 41,176 466,061 2013 166,608 41,881 483,131 2014 176,001 42,917 501,065

Source: U.S. Census, ASM (accessed July 1, 2016).

Table A2. Data for Figure 2

 Year NAICS 3361 Motor Vehicle Manufacturing NAICS 336211 Motor Vehicle Body Manufacturing NAICS 3363 Motor Vehicle Parts Manufacturing 1997 95,437,769,729 343,174 35,276,945,010 1998 102,498,662,613 366,237 37,899,879,496 1999 122,925,815,555 322,635 45,603,846,842 2000 132,814,615,371 414,446 50,000,082,551 2001 130,431,903,687 447,466 47,098,009,374 2002 136,633,879,892 403,039 53,700,221,933 2003 137,410,172,910 509,193 58,505,349,398 2004 145,690,283,994 626,834 65,292,234,447 2005 148,887,041,680 921,513 71,603,562,761 2006 162,140,539,954 1,019,701 72,955,491,912 2007 161,958,491,954 997,625 75,860,098,408 2008 146,025,142,306 822,811 67,949,072,917 2009 96,179,426,186 592,151 48,470,496,097 2010 134,994,259,755 661,431 70,524,147,403 2011 147,092,793,536 743,762 81,607,164,827 2012 174,779,220,486 955,985 94,269,326,731 2013 183,259,646,796 754,065 97,936,887,818 2014 190,763,845,384 783,795 106,486,821,687

Source: USITC Dataweb (accessed July 12, 2016). Imports for consumption used.

Table A3. Data for Figure 3

 Year NAICS 3361 Motor Vehicle Manufacturing NAICS 336211 Motor Vehicle Body Manufacturing NAICS 3363 Motor Vehicle Parts Manufacturing 1997 24,290,051,624 174,959,105 36,230,121,080 1998 22,619,412,870 179,323,308 36,716,266,188 1999 22,063,782,982 212,026,205 39,279,833,905 2000 23,022,509,474 154,036,319 42,288,439,404 2001 22,776,851,427 136,410,773 39,076,167,258 2002 26,314,058,613 109,875,547 39,160,015,750 2003 29,658,892,594 117,550,769 37,281,356,161 2004 30,108,237,085 160,398,476 39,128,056,532 2005 34,851,026,092 197,413,451 40,011,521,051 2006 43,829,584,407 237,976,908 42,739,107,919 2007 52,469,265,443 276,249,943 44,984,131,886 2008 57,176,246,645 192,739,988 41,213,374,787 2009 35,856,069,710 157,655,516 30,074,176,845 2010 48,620,856,753 169,252,333 41,272,401,607 2011 58,806,191,210 235,503,464 46,812,312,596 2012 64,860,753,616 363,704,168 50,878,115,492 2013 69,082,592,413 360,700,398 51,735,753,594 2014 72,839,507,001 451,661,832 53,157,860,602

Source: USITC Dataweb (accessed July 12, 2016). Domestic exports used.

Table A4. Data for Figure 4

 Year NAICS 3361 Motor Vehicle Manufacturing NAICS 336211 Motor Vehicle Body Manufacturing NAICS 3363 Motor Vehicle Parts Manufacturing 1997 291,200,575,105 9,008,680,215 177,558,392,930 1998 309,203,915,743 9,696,170,914 185,659,644,308 1999 368,262,006,573 10,520,423,609 209,121,022,937 2000 349,265,461,897 10,335,162,410 212,047,729,147 2001 327,389,837,260 7,660,342,055 195,142,004,116 2002 351,019,116,279 8,019,082,163 219,059,371,183 2003 371,182,198,316 8,648,213,642 223,517,327,237 2004 377,482,850,909 9,437,590,436 228,806,123,915 2005 375,879,985,588 10,797,334,100 237,697,603,710 2006 380,171,013,547 11,855,509,724 232,515,347,993 2007 368,526,939,511 12,350,667,375 235,829,570,522 2008 296,927,924,661 11,274,819,071 202,349,665,130 2009 208,927,369,476 9,571,669,495 150,814,825,252 2010 293,804,962,002 9,637,047,179 198,470,063,796 2011 322,072,260,326 10,102,314,259 219,559,277,231 2012 370,434,487,870 11,439,853,281 259,114,462,239 2013 397,973,706,706 12,181,962,365 273,190,160,854 2014 425,235,208,535 13,225,048,133 297,994,413,573

Source: U.S. Census, ASM and U.S. International Trade Commission Dataweb (accessed July 1, 2016). Note: Total consumption is measured as total shipments of the U.S. industry minus U.S. exports plus U.S. imports.

Table A5. Data for Figure 5

 Year NAICS 3361 Motor Vehicle Manufacturing NAICS 336211 Motor Vehicle Body Manufacturing NAICS 3363 Motor Vehicle Parts Manufacturing 1997 58.112 78.671 63.985 1998 65.767 80.359 67.179 1999 71.129 82.514 70.861 2000 63.845 78.043 71.969 2001 63.958 63.702 73.772 2002 72.991 73.688 83.6 2003 81.872 87.959 88.213 2004 83.426 84.1 89.981 2005 87.809 88.915 94.765 2006 96.781 90.853 94.052 2007 100 100 100 2008 89.634 92.593 95.418 2009 85.019 94.633 95.736 2010 106.846 103.01 112.19 2011 114.587 103.016 113.679 2012 115.951 100.59 118.032 2013 119.192 108.096 118.078 2014 113.278 107.253 122.47

Source: U.S. Bureau of Labor Statistics, Labor Productivity and Costs Database.

[1] In this research note, the combined motor vehicles industry is defined as NAICS codes 3361, 336211, and 3363. For these years, the industry data are reported on a consistent NAICS basis.

[2] The six digit NAICS code 336211 Motor Vehicle Body Manufacturing is used instead of the four digit (3362), because the four digit category includes trailers that are produced with a separate supply chain that tends to have different suppliers.

[3] Klier and Rubenstein, Who Really Made Your Car? 2008, 8586.

[4] USITC, Economic Impact of Trade Agreements, 180; Coffin, Passenger Vehicle Industry and Trade Summary, May 2013, 53.

[5] USITC, Dataweb (accessed July 12, 2016).

[6] Coffin, Passenger Vehicle Industry and Trade Summary, 2013, 11.

[7] International Federation of Robotics, “Industrial Robot Statistics,” 2015. https://www.ifr.org/industrial-robots/statistics/.

[8] Coffin, Passenger Vehicle Industry and Trade Summary, 2013, 19.

[9] Federal Reserve, G.17 Industrial Product ion and Capacity Utilization, June 15, 2016. https://www.federalreserve.gov/releases/G17/default.htm.

[10] There is a linear approximation error when the formula in equation (3) is applied to the data, since equation (2) is not log-linear.

[11] In general, the effect of a change in imports on U.S. employment will depend on the underlying source or cause of that change. If the increase in U.S. imports is due to a reduction in foreign production costs, then the increase in imports will be associated with a reduction in U.S. employment. However, if the increase in U.S. imports is due to an increase in U.S. aggregate demand, then it will be associated with an increase in U.S. employment.

[12] It would be straightforward to replicate this analysis for any of the U.S. manufacturing industries in the Annual Survey of Manufactures.