The growing trade deficit between the world's two largest economies cost the U.S. $37 billion in lost wages in 2011, a study by the Economic Policy Institute (EPI) has found, and is likely to cost the economy more as the deficit widens further.
According to the study, 2.7 million jobs have been lost in the U.S. between 2001, when China entered the World Trade Organization, and 2011, the bulk of which were in the manufacturing sector. The report took 2011 as a snapshot of the cost of these losses and found that when these displaced employees were re-employed in non-trade-related industries, they lost an average of $13,504 per worker in 2011, creating a total of $37 billion in wage losses over the year.
Robert Scott, EPI director of trade and manufacturing policy research said the damage caused by the trade deficit was hurting the U.S. economy, especially America's working families.
(Read More: US blames China for breakdown in trade talks)
"Allowing the U.S.-China trade deficit to continue growing would eliminate many more jobs in manufacturing - a bedrock of the U.S. economy - and further erode the wages of U.S. workers," said Scott.
Last month the U.S. Commerce Department reported that the U.S.'s trade deficit with China rose to a record $30.1 billion in July, boosting the U.S.'s overall trade gap and prompting fresh complaints that China isn't playing fair.
Trade relations between the two economies have long been strained, due to quarrels over China's alleged currency manipulation and use of illegal industry subsidies, which the U.S. argues interfere with their manufacturers' means to boost exports and increase jobs.
For example, China was warned by the European Union in late August for giving unfair state aid to its domestic solar companies and giving them a competitive advantage, Reuters reported.
(Read More: US Presses China to Stop Growing Trade Secret Theft)
According to the EPI study, minority workers in the U.S. have been particularly hard hit by worsening trade relations with China. For all 958,000 minority workers who lost their jobs in 2011 as a result of the China trade deficit, wage losses totaled over $10 billion in the year or $10,485 per worker.