> Your logic would suggest that workers in tradable industries get paid less than those in non-tradeable goods and services, wouldn't it?
Not necessarily, as the laborers displaced by off-shoring are now competing in the labor pool for many other non-tradeable industries. That's what I meant when I said, "suppressing wages in industries with low costs of entry--remaining manufacturing but especially non-professional services." An increase in supply relative to demand usually will mean a lower clearing price (i.e. more people for fewer jobs usually means lower accepted wages).
Not necessarily, as the laborers displaced by off-shoring are now competing in the labor pool for many other non-tradeable industries. That's what I meant when I said, "suppressing wages in industries with low costs of entry--remaining manufacturing but especially non-professional services." An increase in supply relative to demand usually will mean a lower clearing price (i.e. more people for fewer jobs usually means lower accepted wages).