Tuesday, February 28, 2017

Four Reasons a Crackdown on Illegal Immigrants Could Disrupt the U.S. Labor Market

Eric Morathj writes for The Wall Street Journal:

The Trump administration’s push to crack down on illegal immigration and deport undocumented workers living in the U.S. could have significant ramifications for the labor market.

Here are four reasons why.

About 5% of the Workforce Is Undocumented

There were eight million undocumented immigrants working or looking for work in the U.S. in 2014, the most recent data available from the Pew Research Center. The figure, about 5% of the civilian workforce, exceeds the number of jobs added by U.S. employers the past three years...

Deportation of millions of those workers could lead to labor shortages and weaker economic growth. Some economists say deportations would cut already low unemployment among legal residents and push up incomes, especially in low-wage sectors. (Though not necessarily. Employers could opt to automate or cut back production.)...

Undocumented Immigrants Are Younger and More Likely to Work

Among all illegal immigrants, a significantly higher share work than in the U.S. population as whole. The difference largely reflects that 92% of undocumented workers are between 18 and 64, while just 60% of the U.S.-born population is.

An aging population limiting labor-force expansion is a significant factor economists point to when explaining why economic growth has been mired at a very modest 2% rate since the recession ended in 2009. Unemployment is at historically low levels, but the share of Americans in the labor force is also near a 40-year low.

The growth in immigrants, legal and illegal, from 2006 through 2015, offset population losses for native-born Americans ages 25 to 54, the prime ages for working.

Employers have turned to legal and illegal immigrants to help counter the trend of an aging native-born population...

Undocumented Workers Are Concentrated in Certain Industries

In theory, the 7.6 million people who were unemployed but seeking work last month could step into jobs vacated by illegal immigrants. But that would largely be at farms, meat-processing plants, restaurants and construction sites.

A shortage of labor could push up wages paid in those sectors. It could also increase the cost of groceries and meals out.

More than 1 in 6 agriculture-industry workers in 2014 were undocumented workers, compared with about 1 in 20 workers overall, Pew said. In the construction industry, 13% of workers were undocumented. And 9% of workers in the leisure and hospitality industry, which includes restaurants, were illegal immigrants....

It’s Not Just Border States That Are Affected

The states potentially most affected are widely spread.

More than 10% of workers in Nevada, a state with among the highest concentration of hospitality jobs, were illegal immigrants in 2014, according to Pew. Border states of California, Texas and Arizona were also among the top five states for share of undocumented immigrants in the labor force.

But more northern states with dense urban areas—New Jersey, Maryland and New York—were also above the national average.

RW note: A serious crackdown on undocumented will mean higher prices, and fewer products and services available. I fully expect that under such circumstances marginally profitable hotels and restraunts will end up closing. Farm food will sky rocket in price.


  1. Where the hell is this 'low' unemployment? I would like someone to prove this to me. I know people it has taken months to find other work even in what are regarded as menial jobs. WTH?

    John Williams of Shadowstats claims unemployment in the low 20's% using the way it was done in the early 80's.

    1. Re: The Lab Manager,

      From the standpoint of wanting to work, the unemployment rage as it is calculated today makes sense, because counting people who *could* work alongside those who are actively looking for a job is making an unreasonable assumption.

      As for people who cannot find a job: remember that a job is still an exchange, which entails opportunity costs. There will be jobs that those friends of yours will not want to do at all, regardless of what they tell you. People lie, you know - even to your very face. But their actions don't lie.

    2. As usual Francisco, you are an effing clueless idiot.

  2. --- I fully expect that under such circumstances marginally profitable hotels and restraunts will end up closing. ---

    But Trumpistas will counter this by pointing out at all those Americans who are not actively looking for work who would be more than willing to do those jobs like changing the hotel bed sheets full of bodily fluids or cleaning crappers at restaurants... Or picking up strawberries under the f...ng sun... Yeah, perfectly possible.