In This Review

Global Trade in Services: Fear, Facts, and Offshoring
Global Trade in Services: Fear, Facts, and Offshoring
By J. Bradford Jensen
Peterson Institute of International Economics, 2011, 288 pp

The United States now produces all its material output -- food, minerals, manufactured goods, construction -- with less than 20 percent of its labor force. Yet agriculture and manufacturing still receive disproportionate political attention. Jensen turns the spotlight on the more than 80 percent of U.S. workers employed in services, a diverse category that includes legal, accounting, architectural, educational, and medical services, as well as transportation and retail. He argues that many services are becoming increasingly tradable, meaning that some service jobs might move overseas. But tradable services typically require high levels of education and skill, so increased international trade in services should favor the American work force, which is relatively well educated and skilled. Jensen concludes that U.S. policy should aim to further liberalize trade in services to help American workers take advantage of the vast increase in infrastructure expenditures likely to occur in developing countries in the coming decades, which will create jobs that require advanced design and engineering skills. He also urges more attention to education at all ages to maintain American workers’ high level of skills.