by Derek Hill
This InfoBrief presents recent trends in U.S. advanced technology product (ATP) exports. It uses U.S. Census Bureau data available through 2010 to examine the changes in these exports during the recent U.S. recession ("2008–09 recession") and to offer a brief comparison between the 2008–09 recession and the 2001 recession. It focuses on 4 of the 10 ATP areas defined by the Census Bureau. These are aerospace, electronics, information and communications technology (ICT), and life science, which together accounted for 85% of U.S. ATP exports in 2010. This InfoBrief also describes U.S. ATP trade with selected major economies and regions.
U.S. ATP exports contracted 9% during the recent U.S. recession, from $270 billion in 2008 to $245 billion in 2009 (figure 1 and tables 1 and 2)—less than half the 20% rate of loss of non-ATP exports, excluding petroleum. U.S. ATP imports fell by the same percentage as exports, whereas other types of U.S. imports contracted by 24%.
Figure 1 Source Data: Excel file
Table 1 Source Data: Excel file
Table 2 Source Data: Excel file
Comparison of data from 2010 with data from 2009 reverses this picture. U.S. ATP exports showed signs of recovery, advancing by 11% over 2009. But other types of U.S. exports expanded at twice that rate (23%) (figure 1).
The economic impact was far more severe during the 2008–09 recession than during the 2001 recession. However, in the more recent recession the downturn of U.S. ATP exports was relatively milder and the recovery of these exports was relatively faster (figure 2). Similarly, the U.S. computer and electronics industry, a major source of U.S. ATP exports, showed a shorter and shallower decline in production in the 2008–09 recession when compared with the 2001 recession.
Figure 2 Source Data: Excel file
U.S. Advanced Technology Product Exports: Four Selected Technologies
U.S. ATP exports varied between the recent recession (2008–09) and the period surrounding the end of the recent recession (2009–10) among the four largest technologies—aerospace, electronics, ICT, and life science (table 2).
U.S. aerospace exports showed little change between 2008 and 2009 ($85 billion to $84 billion), with a slight widening of the U.S. trade surplus to $54 billion in 2009 (table 2). This volatile sector was the only one of the four largest technologies to see a decline in U.S. exports between 2009 and 2010 (4%). During this period the U.S. trade surplus in this technology fell by $3 billion to reach $51 billion.
Between 2008 and 2009 U.S. electronics showed the sharpest decline in exports among the big four technologies (27%) (table 2). This decline was three times as large as the overall rate of decline for ATP exports (9%). During this period exports of U.S. electronics dropped from $51 billion to $37 billion, and the U.S. trade surplus in this category declined from $25 billion to $16 billion. Between 2009 and 2010 exports of U.S. electronics grew by 23%, a faster rate than the other three largest technologies. The U.S. trade surplus in this category rose by $2 billion to reach $18 billion.
U.S. ICT exports fell 14% between 2008 and 2009 (from $77 billion to $67 billion) (table 2), a rate one and a half times greater in percentage terms than the overall decline in U.S. ATP exports. The U.S. trade deficit in this technology, the largest among these four technologies, was nearly unchanged during this period ($105 billion to $103 billion). Between 2009 and 2010 U.S. ICT exports grew 16%, faster than U.S. ATP exports overall (11%) but lagging behind the growth of U.S. ICT imports (21%); this resulted in a widening of the U.S. ICT trade deficit from $103 billion in 2009 to $127 billion in 2010.
U.S. exports in this category showed little change between 2008 and 2009 ($25 billion in both years), with the U.S. trade deficit falling slightly to reach $13 billion in 2009 (table 2). Between 2009 and 2010 U.S. exports of life science grew at about the rate of ATP exports overall, and the U.S. life science trade deficit widened slightly to $14 billion in 2010.
U.S. Advanced Technology Product Trade by Country/Region
The pattern in U.S. ATP exports from 2008 to 2010 varied widely among three main trading regions: Asia, the European Union, and the North American Free Trade Agreement (NAFTA) trade zone.
U.S. ATP exports to Asia fell from $94 billion in 2008 to $79 billion in 2009; at 15%, this is the largest decline among the three main trading regions (table 2). The decline was driven by a drop in electronics exports to Asia, the most important export market for this technology, and a drop in ICT exports (tables 3–4).
Table 3 Source Data: Excel file
Table 4 Source Data: Excel file
During this period U.S. ATP exports declined steeply (19%–29%) to Japan, South Korea, and Taiwan, but these exports to China saw little change (table 2). The change in U.S. ATP imports by Asian country/economy was similar, and the U.S. trade deficit with this region fell slightly to $91 billion in 2009.
The stronger performance of U.S.-China ATP trade relative to other Asian economies may reflect both the apparently milder impact of the 2008–09 recession on China when compared with other major Asian ATP exporters and a stable U.S.-China currency exchange rate when compared with the dollar fluctuating against other Asian currencies (table 1).
The data for 2010 offer a contrasting picture. U.S. ATP exports to Asia grew 23% between 2009 and 2010 (table 2), a rate more than two times greater than the overall increase in ATP exports, with rapid growth in electronics (table 3). But U.S. imports from Asia exceeded exports, widening the U.S. ATP trade deficit with Asia during this period from $91 billion in 2009 to $112 billion in 2010.
U.S. ATP exports to the European Union totaled $70 billion in 2009 (table 2), down 7% from 2008, led by steep falls in ICT and electronics (tables 3–4). The trend varied among the three largest European Union economies: increasing to France, showing little change to Germany, and declining to the United Kingdom. The U.S. trade surplus with the European Union widened from $6 billion to $10 billion between 2008 and 2009.
Between 2009 and 2010 U.S. ATP exports to the region fell 5%, led by the fall in aerospace (tables 2–3). Among the three largest European Union economies, U.S. ATP exports decreased to France (−8%) and the United Kingdom (−7%) and remained roughly steady to Germany (−2%). U.S. ATP imports from the European Union rose slightly during this period (from $61 billion to $66 billion), led by life science (table 4). The U.S. ATP trade surplus with the European Union fell from $10 billion to less than $500 million during this period.
NAFTA trade zone
U.S. ATP exports to NAFTA partners fell 8% between 2008 and 2009, from $48 billion to $45 billion (table 2), with losses in all four technologies (tables 3–4). U.S. ATP exports to Canada declined by 17%, but U.S. ATP exports to Mexico rose by 5%. The U.S. trade surplus with Canada fell slightly to $10 billion in 2009, and the trade deficit with Mexico showed little change ($19 billion in 2009).
Between 2009 and 2010 U.S. ATP exports to NAFTA grew 23% (table 2), with strong gains in electronics and ICT (tables 3–4). These exports to Mexico rose briskly (32%), fueled by strong gains in ICT and electronics, with a smaller increase to Canada (15%). The U.S. ATP trade deficit with NAFTA narrowed slightly during this period, with the U.S. trade surplus with Canada rising from $10 to $15 billion and the U.S. trade deficit with Mexico increasing $3 billion to reach $22 billion.
 Derek Hill, Science and Engineering Indicators Program, National Center for Science and Engineering Statistics, National Science Foundation, 4201 Wilson Boulevard, Suite 965, Arlington, VA 22230 (firstname.lastname@example.org; 703-292-7805).
 According to the National Bureau of Economic Research, the most recent U.S. recession started in December 2007 and ended in June 2009, making it the longest recession since World War II. For convenience, this recession period is identified as "2008–09" in this InfoBrief. Real gross domestic product (GDP) growth fell from 1.9% in 2007 to 0% in 2008 and contracted 2.6% in 2009. The previous recession in 2001 lasted less than 1 year (March 2001 to November 2001), with real GDP growth slowing in 2001 but remaining positive. For more information, see http://www.nber.org/cycles/main.html.
Fluctuations of the U.S. dollar against other currencies, which may be a contributing factor in the trends discussed here, have not been systematically included in this analysis. For example, appreciation of the U.S. dollar against the euro makes U.S. exports more expensive in euro terms, which may reduce U.S. exports to the European Union. Table 1 shows the U.S. dollar exchange rate against selected currencies.
 The other six ATP areas are advanced materials, biotechnology, flexible manufacturing, nuclear technology, optoelectronics, and weapons. More information on the collection, definition, and measurement of ATPs and other trade data can be found at http://www.census.gov/foreign-trade/guide/sec2.html.
 Asia includes China, India, Indonesia, Japan, Malaysia, the Philippines, Singapore, South Korea, Taiwan, and Thailand; China includes Hong Kong. The European Union includes 27 current member countries. NAFTA comprises Canada, Mexico, and the United States.
 China's real GDP growth slowed from 13% in 2007 to 9% in 2008, with other major Asian ATP exporters showing a sharper slowdown in GDP growth or a contraction in their GDP during this period. For statistics on GDP growth rates for Asian countries, see the World Bank's World Development Indicators, http://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG; for Taiwan, see Taiwan's official economic statistics website, http://eng.stat.gov.tw/mp.asp?mp=5.