What is one potential negative impact of free trade on developed countries?

One potential negative impact of free trade on developed countries is the possibility of manufacturing job loss. As countries open their markets to international competition, businesses may relocate production facilities to countries where labor costs are lower and regulations are less stringent. This shift can lead to a decline in domestic manufacturing jobs as companies seek to maximize their profits by reducing costs.

Moreover, the influx of cheaper imported goods may displace local manufacturing, leading to layoffs and a shrinking job market in specific industries that are unable to compete with foreign producers. As a result, while consumers might benefit from lower prices on goods, the workforce in developed countries can face significant challenges as traditional manufacturing roles diminish. This dynamic highlights a critical trade-off that often arises in discussions about the merits and drawbacks of free trade agreements.