Trade has some employment implications, but will NOT solve it all...

Is it correct to talk about trade "creating" and "destroying" jobs at all? Imports and exports obviously contribute to a great deal of churning in the labour market. They are responsible for a lot of "gross" job creation and destruction. But are they responsible for net job creation in a country? Economists normally think of trade as a force that reshapes the composition of employment, not its overall level. The level of employment is ultimately determined by aggregate demand, and aggregate demand is determined by whatever the central bank thinks the economy can bear, without jeopardising stable prices. Orders from China is one component of aggregate demand, to be sure. But if China shut up shop, creating a bit of economic slack in its trading partners, their central banks would simply cut ' interest' rates to compensate. Competiveness..  counts as well...




It may take little effort to understand ...but it is the correct way: trade "creating" and "destroying" jobs is NOT  " the " foreign trade issue!
Largely copied from The Economist - analyzing Hu's claims.