By Nathalie Voit
The U.S. international trade deficit surpassed $1 trillion in 2021, driven by a 27% increase in the goods and services deficit over the year, according to Commerce Department data released on Feb. 8.
The annual deficit surged from $676.7 billion in 2020 to a record $859.1 billion last year as imports far outpaced exports, the department said.
Exports were $2,528.5 billion, up $394.1 billion or 18.5% from 2020. Imports were $3,387.7 billion, up $576.5 billion or 20.5% from the prior year.
Import gains were broad-based, driven by heavy spending on industrial supplies and materials such as crude oil and other energy sources that experienced substantial inflation over the year.
Spending on foreign-made consumer goods like cell phones, toys, games, household goods, and clothing also pushed import levels up, followed by spending on automotive vehicles, engines, and parts, the department said.
Month-over-month, the deficit was $80.7 billion in December, up $1.4 billion or 1.8% from November. Exports for the month rose 1.5% to $228.1 billion. Imports climbed 1.6% to $308.9 billion.
Year-on-year, the average goods and services deficit jumped $9.9 billion from the quarter ending in December 2020, according to the report.
The deficit with China increased by $45.0 billion or 14.5% in 2021 to reach $355.3 billion, despite a 21.4% increase in U.S. goods exports to China since 2020.
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