Currencies

U.S. trade deficits hit record highs in 2021: More effective trade, industrial, and currency policies are needed to create more domestic manufacturing jobs


The U.S. goods trade deficit reached a record $1.09 trillion in 2021—an increase of $168.7 billion (18.3%) from the 2020 trade deficit—according to new U.S. Census Bureau data. The broader goods and services deficit reached $859.1 billion in 2021, an increase of $182.5 billion (27.0%). These records were driven by a $576.5 billion increase in goods and services imports, including a $501.8 billion increase in goods imports.

The surge in the U.S. goods trade deficit extends a surge in offshoring that has eliminated more than 5 million manufacturing jobs and nearly 70,000 factories since 1998, with overlooked costs for Black workers and other workers of color, as we describe in this new EPI report.

While both imports and exports were depressed in 2020 due to the COVID recession, U.S. trade deficits increased sharply in both 2020 and 2021, as shown in the figure below. This is because the United States was unable to produce the goods needed to respond to the pandemic and to meet increased domestic demand for consumer goods.

However, contrary to popular opinion, the growth in U.S. imports was not just caused by increased domestic goods consumption coming out of the 2020 COVID recession. Imports explained more than 60% of the growth in U.S. goods consumption in 2021, and U.S. goods imports increased faster (21.3%) than domestic goods consumption (17.8%).

Soaring U.S. goods trade deficits reached $1.1 trillion in 2021, 1997–2021

U.S. goods trade deficit Manufacturing trade deficit
1997 $198.4 $130.7
1998 $248.2 $186.5
1999 $337.1 $259.0
2000 $446.8 $317.2
2001 $422.4 $304.1
2002 $475.20 $362.6
2003 $541.60 $403.1
2004 $664.80 $487.4
2005 $782.80 $541.4
2006 $837.30 $558.5
2007 $821.20 $532.1
2008 $832.50 $456.1
2009 $509.70 $319.3
2010 $648.70 $412.6
2011 $741.00 $440.5
2012 $741.10 $467.7
2013 $700.50 $458.8
2014 $749.90 $526.9
2015 $761.90 $629.8
2016 $749.80 $647.3
2017 $799.30 $695.5
2018 $878.70 $777.4
2019 $861.50 $789.4
2020 $922.00 $900.1
2021 $1,090.70 $1,066.3
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