Trade is the subject of much debate. Perhaps given the past 18 months that’s an understatement, but from the renegotiations around NAFTA to recent discussions at the Council of the Federation around
interprovincial trade to CETA and CPTPP agreements, not only the act of trade, but the core value of why we trade is being called into question.
How do we incorporate values in the midst of looking for solutions to continue with and expand the integrated economies of the world? The values question adds another layer to the debate and the truth of the matter is that both the trade itself and the reason why we look to trade in the first place are intended to achieve the same goal – prosperity. Many technologies such as the Internet, social media platforms, e-commerce and more have created connections that were beyond imagination even just a few decades ago. These connections and technologies allow for easier and faster trade, but then what is the human impact? And how do we adjust training and skills to adapt to a changing reality?
The International Chamber of Commerce (ICC) has been formulating a position on why #TradeMatters for a while now. ICC Secretary General John W.H. Denton AO, in an interview with MSNBC, spoke to why trade was encouraged over 40 years ago, identifying that multi-lateral, non-discriminatory trade in abundance achieved the desired prosperity for effort. The challenge today, he went on to say, is that “talk of the aggregate benefits of trade was of little comfort to someone who has lost their job or is working for less" and that he is “genuinely worried about those who are no longer in favour of the open economy. Investing in skills and development is only part of the answer. It also requires looking at what the jobs of the future are, and how you prepare people for lifelong learning to participate in that is not just a government issue. It should obsess businesses everywhere.”
It’s an interesting perspective that encapsulates the debate around trade as a whole and separates the role of country from the actual act of trade.
The ICC also writes the following:
“Evidence shows that well over 80% of job losses in advanced economies are not due to trade, but increased productivity through technology and innovation. As the world’s largest business
organization ICC urges governments at the national level to work with business to shape policies and
partnerships that address labour market dislocations.”
Labour market questions are of huge concern to communities of all sizes. In Peterborough city and county there are businesses who are unable to find the workers they need and this inhibits growth, competitiveness and prosperity.
Through our Leaders Lunch series which is focused on market access, the Peterborough Chamber has found itself bringing together local business leaders as well as educators and institutions around building and providing a workforce that can help those businesses interested in trade stay competitive in our global economy.
“There is an issue that we are confusing job losses as a consequence of trade or as a consequence of shifts in economic power or from technological advances,” Mr Denton said in the MSNBC interview. “Decisions about how you skill people up to confront new realities of new jobs that are being created are domestic issues.”
Since the recession of 2008 diversifying our trading partners has been a focus of our federal
government. This is seen with the signing of CETA and CPTPP. And while there has also been
considerable discussion around upskilling and the skills mismatch, that discussion in the context of trade has not been as loud. It is a good place to start though. If as a country we are encouraging more trade with new partners, having an understanding of the job requirements those new trade agreements could foster is crucial. If technology has sped up the time it takes to produce a widget then what are the skills required of
employees in the new process? How do they fit in? What is the willingness and ease of returning to school to ensure business competitiveness and relevance?
The fact that the US tariffs on steel and aluminum and the reciprocating measures from these countries
(except Japan) is in the billions - $37B on China, $13B on Canada, $8B on the European Union, $3B on Mexico, and $2B on Japan - highlights the prosperity that has been created through trade, but what’s missing is the human impact. From a blog by the US Chambers of Commerce we know that the
integration of economies goes beyond monetary value to the millions of jobs currently dependent on trade.
The question should not be how to scale back or adjust the amount of trade to achieve prosperity, but how to encourage a workforce that can meet the trade demands that the world wants to see.
International Chamber of Commerce Blog