The story of economic progress is a story of economic change. It is a story in which whole industries can rise and fall, replaced by new ideas and innovations, which demand new skills. This relentless process of transformation has built the global economy of today, bringing growing prosperity for billions of people around the world – and it has made the ability to adjust and adapt an essential element of economic success. Now, as before, individuals, firms and societies are striving to respond to rapidly evolving economic conditions in order to share in the benefits. The difference today is the remarkable speed at which these changes are occurring.
The 2017 World Trade Report takes a closer look at this phenomenon. It focuses on trade and technology as two of the most powerful drivers of economic progress, and examines their effect on labour markets in both developed and developing countries.
The report finds that trade and technology are vital sources of economic growth. They drive up productivity, encourage the exchange of ideas, increase access to products and the range of products available, lower prices and improve living standards. Looking specifically at the labour market, they have a range of effects that are positive overall. For example, evidence highlighted in this report shows that trade’s impact on a country’s labour market is to increase overall employment and real wages. However, while the overall picture is very positive, with most regions, sectors, and individuals benefitting considerably from trade, it is important to acknowledge that others can lose out. The same is true, to a much greater extent, with technology. Clearly, benefits spread over the whole economy are of little comfort to someone who has lost his or her job, and therefore developing effective policies to support people to adjust is essential. We need to ensure that the benefits of economic progress reach everybody.