Skilled and low-wage employees most vulnerable to globalization
PRESS RELEASE
- Two UB-led studies show that the impact of Chinese competition depends on the type of employment, and that collective bargaining agreements can intensify wage losses.
Sergi Basco, professor at the Faculty of Economics and Business at the UB.
News
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Research
29/09/2025
Globalization does not affect all workers equally. The sector in which people work has a lot to do with it, but it is not the only factor. This is demonstrated by two studies led by Sergi Basco, professor at the Faculty of Economics and Business at the University of Barcelona, in collaboration with Maxime Liégey, from the University of Strasbourg; Martí Mestieri, from the Institute for Economic Analysis (IAE-CSIC) and the Barcelona School of Economics, and Gabriel Smagghue, from the Bank of France.
Sergi Basco, professor at the Faculty of Economics and Business at the UB.
News
|
Research
29/09/2025
Globalization does not affect all workers equally. The sector in which people work has a lot to do with it, but it is not the only factor. This is demonstrated by two studies led by Sergi Basco, professor at the Faculty of Economics and Business at the University of Barcelona, in collaboration with Maxime Liégey, from the University of Strasbourg; Martí Mestieri, from the Institute for Economic Analysis (IAE-CSIC) and the Barcelona School of Economics, and Gabriel Smagghue, from the Bank of France.
In the French case, the results are clear: those most exposed to competition from Chinese imports are professionals with highly specialized profiles, difficult to transfer to other fields, and who also work in sectors that are heavily regulated by collective bargaining agreements. Because of the similarity between France and Spain, this pattern also points to the Spanish labour market.
The debate is clear: how to maintain the benefits of international trade and, at the same time, reduce the inequalities it can cause?
To answer this question, researchers studied the trajectories of more than 163,000 workers in the French private sector between 1993 and 2015. The methodology combines administrative data and theoretical modelling. Interestingly, unlike other studies focusing only on sectors, this one analyses the specific type of job as a key element in explaining vulnerability to trade shocks such as the China shock, a sudden and intense rise in international competition driven by Chinese imports, which negatively affects workers’ earnings in certain jobs.
The first article, published in the Journal of International Economics, even introduces an occupational exposure index to measure the extent to which each profession is more or less affected by the pressure of Chinese imports. The results show that profiles such as technicians or engineers are much more affected than other more transversal jobs, such as administrative jobs. The reason is that when production falls, these skilled professionals find it more difficult to move to other fields. The study concludes that cumulative wage losses due to occupational exposure are as large as those previously attributed to differences between sectors, which calls into question simplistic views based only on training or educational attainment.
The debate is clear: how to maintain the benefits of international trade and, at the same time, reduce the inequalities it can cause?
To answer this question, researchers studied the trajectories of more than 163,000 workers in the French private sector between 1993 and 2015. The methodology combines administrative data and theoretical modelling. Interestingly, unlike other studies focusing only on sectors, this one analyses the specific type of job as a key element in explaining vulnerability to trade shocks such as the China shock, a sudden and intense rise in international competition driven by Chinese imports, which negatively affects workers’ earnings in certain jobs.
The first article, published in the Journal of International Economics, even introduces an occupational exposure index to measure the extent to which each profession is more or less affected by the pressure of Chinese imports. The results show that profiles such as technicians or engineers are much more affected than other more transversal jobs, such as administrative jobs. The reason is that when production falls, these skilled professionals find it more difficult to move to other fields. The study concludes that cumulative wage losses due to occupational exposure are as large as those previously attributed to differences between sectors, which calls into question simplistic views based only on training or educational attainment.
Two UB-led studies show that the impact of Chinese competition depends on the type of employment, and that collective bargaining agreements can intensify wage losses.
The second article, published in Economics Letters, analyses the role of collective bargaining. The study finds that, rather than cushioning the impact, collective agreements can intensify losses, especially among low-paid workers. Skilled workers find that, in highly regulated sectors, wages fall more in highly regulated sectors than in less regulated ones. In contrast, in the case of executives and engineers, the difference according to the degree of regulation practically disappears. Adjustments occur both through a direct reduction in salary and through a reduction in the hours worked, with the latter mechanism usually being the more important. However, the authors insist that this is not a criticism of collective agreements, but rather empirical evidence that invites us to rethink their effectiveness in the current context.
The implications go beyond the French case. “Our work can be extrapolated to Spain, whose labour market is very similar, and it also helps to understand what would happen in the face of measures such as the proposed tariffs in the United States: a fall in exports has very similar effects to an increase in Chinese imports,” says Professor Basco. Given this context, the research team stresses the need for policies that consider the diversity of jobs and the real role of regulation. Professional re-skilling, mobility between sectors and the adaptation of agreements appear to be essential tools to face the challenges of globalization with greater equity.
These two publications are part of a consolidated line of research by Professor Sergi Basco, an expert in international economics and inequalities, and a member of the Barcelona Economics Analysis Team (BEAT). As part of his teaching and research work at the UB, Basco has previously analysed the impact of international trade on housing and productivity. The new study reinforces his commitment to an open and socially fairer economy.
The implications go beyond the French case. “Our work can be extrapolated to Spain, whose labour market is very similar, and it also helps to understand what would happen in the face of measures such as the proposed tariffs in the United States: a fall in exports has very similar effects to an increase in Chinese imports,” says Professor Basco. Given this context, the research team stresses the need for policies that consider the diversity of jobs and the real role of regulation. Professional re-skilling, mobility between sectors and the adaptation of agreements appear to be essential tools to face the challenges of globalization with greater equity.
These two publications are part of a consolidated line of research by Professor Sergi Basco, an expert in international economics and inequalities, and a member of the Barcelona Economics Analysis Team (BEAT). As part of his teaching and research work at the UB, Basco has previously analysed the impact of international trade on housing and productivity. The new study reinforces his commitment to an open and socially fairer economy.
References
The complete articles are available:
«The effect of import competition across occupations». Journal of International Economics, January 2025. <https://doi.org/10.1016/j.jinteco.2024.104001>.
«Import competition and labor regulation: Worker-level evidence». Economics Letters, August 2025. <https://doi.org/10.1016/j.econlet.2025.112421>.
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