DATE: Thursday, July 17, 1997               TAG: 9707170466

SECTION: BUSINESS                PAGE: D2   EDITION: FINAL 

SOURCE: ASSOCIATED PRESS 

DATELINE: WASHINGTON                        LENGTH:   50 lines

SUCKING SOUND COMES FROM CANADA

Canada, not Mexico, has claimed more U.S. jobs through changing trade patterns since the North American Free Trade Agreement became effective three years ago, according to a new study.

The analysis by UCLA researchers found that the net American job losses to Canada or jobs threatened by trade with it totaled 39,117 since NAFTA took effect in January 1994. However, the changing trade flow with Mexico has produced a net 8,854 new U.S. jobs, the study said.

The net loss of 30,263 jobs when the effects of the new trade patterns with Canada and Mexico are combined supports the view of most economists that NAFTA has had only a small impact on the overall U.S. economy, which has produced a total of 6 million new jobs over the past three years.

But it does call into question the argument of many NAFTA opponents that the biggest threat from NAFTA would come from low-wage workers in Mexico.

``The irony is that while everybody is focusing on Mexico, the majority of what has occurred involves Canada,'' said economist Raul Hinojosa Ojeda, director of UCLA's North American Integration and Development Center and co-author of the new report.

Hinojosa's study was an expansion of a report first done last year that focused only on U.S. trade with Mexico. The UCLA research is considered among the most comprehensive being done on the economic impacts of NAFTA.

The study reviewed changing trade patterns between the United States and its two NAFTA partners in an effort to determine where jobs were being created because of increased exports or threatened because of rising imports.

The report found that rising U.S. exports to Mexico had helped support an increase of 43,751 U.S. jobs while increased imports from Mexico had threatened or caused the outright loss of 34,897 U.S. jobs, for a net positive impact of 8,854 jobs.

For Canada, rising U.S. exports supported a smaller increase of 8,362 jobs while rising imports from Canada put at risk 47,479 jobs for an overall negative impact of 39,117 jobs.

Hinojosa said one reason for the smaller job impact from Mexico was that increased Mexican electronics and clothing exports were displacing Asian products rather than U.S.-produced goods in the American market.

U.S. trade deficits with both countries have swelled since NAFTA went into effect, more so with Canada because of the larger volume of trade with it.

The new study follows a report released last week by the Clinton administration claiming that NAFTA has been a small plus for the U.S. economy.

The UCLA study was released Wednesday at a news conference called by several Hispanic organizations and Hispanic members of Congress who contended the administration has done to little to protect American workers.

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