The TTIP will lead to at least a million job losses and threaten labour standards in US and EU.
Much has been written on the potential economic impacts of the Transatlantic Trade and Investment Partnership (TTIP) currently being negotiated between the EU and US. Proponents of the agreement have paid far less attention to the impact that TTIP will have on employment. And the reason is not hard to see.
The headline finding from the official assessment of TTIP is that there will be a loss of at least one million jobs in the EU and US as a direct result of the agreement’s coming into force. This is the conclusion of the report commissioned by the EU from the Centre for Economic Policy Research (CEPR) in London at the outset of the negotiations (pdf).
The CEPR study calculates the level of displacement that TTIP will bring to employment, cited as a percentage of the labour force in the EU and US. Under the ‘ambitious’ scenario for TTIP preferred by EU negotiators, the CEPR reveals that at least 1.3 million European workers will lose their jobs as a direct result of the agreement. In addition, over 715,000 US workers also stand to lose their jobs under this scenario, giving a total of over two million job losses in total.
Even under a less ambitious scenario, the CEPR study predicts that TTIP will lead to the direct loss of over 680,000 jobs in the EU and a further 325,000 in the US. This means that TTIP will lead to the loss of at least one million jobs between the EU and US, whatever the level of ambition achieved.
Will these newly unemployed workers have any chance of finding alternative jobs? The CEPR study is by definition unable to predict TTIP’s net impact on employment levels, as the model used in its analysis assumes a fixed supply of labour.
The European Commission, however, admits in its own impact assessment that the effect of the job losses from TTIP will be ‘prolonged and substantial’. At a time when unemployment rates in Europe already stand at record levels, the Commission recognizes the ‘legitimate concerns’ that those workers who lose their jobs as a result of TTIP will not be able to find other employment.
That is not all. TTIP poses a recognized threat to labour standards, undermining the quality as well as the quantity of available work. TTIP also aims to open up public procurement and public service contracts, threatening workers’ rights by means of increased privatization. Popular ‘Buy American’ provisions aimed at protecting local jobs in US states have been explicitly targeted for removal by EU negotiators, promising further mayhem.
TTIP will be a disaster for working men and women on both sides of the Atlantic. Anyone under the illusion that it could be a ‘gold standard’ agreement for labour should think again.
This expert opinion is one of a series of articles on trade agreements. The series was published shortly before the start of the 7th round of negotiations on TTIP on 29 September and the expiry of the deadline for signing the EPAs that the EU has set at 1 October. Please find the other articles in this series here.