U.S. Exporters Feel Favorable Trade Winds

China's industrialization has been so swift and its demand for products so intense that it has sparked sales of American-made goods all over the world. Caterpillar racked up exports of $9 billion in 2005, with particularly strong sales to China. American factories churn out oil-drilling gear bound for the Middle East, with much of the resulting crude landing in China. Mining equipment is shipped to India and Australia to extract iron ore bound for smelters in Japan and Korea, with the resulting steel headed to China to be turned into automobiles and skyscrapers.

But even as exports have improved profits for American companies, they have not meant more jobs for American factory workers. In 2006, the United States had 14.2 million manufacturing jobs, according to the Labor Department, roughly the same number as in 2004. American firms have managed to squeeze more goods out of their plants with the same number of workers.

"Growth in output has not been fast enough to require manufacturers to expand the workforce," said David Huether, chief economist at the National Association of Manufacturers in Washington.

Still, some areas of manufacturing have seen sharp job growth, among them computer and electronic products, whose factories added 128,000 production jobs from 2004 to 2006, according to the Labor Department. Fabricated metal products -- which includes everything from sheet metal to silverware -- added 72,000 production jobs over that period, and machinery added 69,000. The automobile industry shed more than 57,000 production jobs, and apparel lost 39,000.

Many economists say the export boom can be sustained because of the vibrancy of the world economy. The World Bank estimates that global output grew at a rapid 5.1 percent last year and that it will grow 4.5 percent this year. Several developing economies, including China's, are expected to grow twice as fast.

But these economists add that exports are not likely to dent the trade deficit significantly, because much of the gear being sold by U.S. firms is used to make products that are then shipped into the United States.

An MTS factory in Oak Ridge, Tenn., makes testing gear for tiny components used by U.S. semiconductor factories that sell products to Asia. In China, workers slot these U.S.-made chips into computers and cellphones that are exported to the United States. China buys about one-third of the U.S. cotton crop, folding it into the production of clothing that lands on shelves from Wal-Mart to Saks Fifth Avenue.

"The only way the trade deficit is going to go away is if Americans become penny-pinching savers," said Catherine L. Mann, a Brandeis University economist and a senior fellow at the Peterson Institute for International Economics in Washington. "How likely do you think that is?"

Given that exports make up a much smaller portion of the U.S. economy than consumption of goods and services -- about 11 percent vs. about 70 percent -- foreign sales will not be big enough to take up the slack if Americans seriously curtail spending because of the housing downturn, said Brad Setser, an economist at Roubini Global Economics in New York.

Still, the slight improvement in the U.S. balance of trade helped the economy grow faster than 3 percent annually over the last three months of the year, up from a 2 percent pace in the previous quarter, according to many estimates.

"Foreigners buying our goods are keeping our factories humming," said Diane Swonk, chief economist at Mesirow Financial Holdings.

Eden Prairie, a grid of glass-fronted office parks spread across former cornfields west of Minneapolis, typifies the ways many American communities have been remade by the advent of a globalized economy. A quarter of a century ago, blue-collar laborers wielded wrenches and welding torches, fabricating pumps, hoses, and pipes. In the late 1980s, they still made computers and electronic parts here, along with the metal nameplates that adorned cars.