Employment, skill structure and international trade: Firm-level evidence for France

We use the French Customs files, an exhaustive account of the international trade transactions carried out by firms across the period 1986-1992, to analyze the link between imports, exports, employment, and skill structure of French manufacturing firms. Our data allow us to distinguish between imports of finished goods and imports of intermediate inputs. Our results show that there is a strong correlation between increasing imports, in particular imports of finished goods, and job destruction, most notably destruction of production jobs. Interestingly, the strength of the relation between job destruction and imports is stronger for larger firms. For example, within production jobs, the association between increasing imports of finished goods and destruction of unskilled jobs is only found in large firms. These findings are robust to the introduction of firm-level measures of innovation. (C) 2006 Elsevier B.V. All rights reserved.