A Somali refugee’s encounter with meatpacking work

May 25th, 2016

Meat processing plants went rural in the last decades of the 20th Century, luring immigrant workers to places like Liberal, Kansas. Chico Harlan of the Washington Post narrates the struggle of a Somali refugee, 23 year-old Mohamed Ahmed, to make a living in this very tough work. Ahmed drives hundreds of miles through the Midwest and mountain states in search of an extra couple of bucks and hour pay and a job that doesn’t wear him down.

Harlan traces Ahmed’s story in the context of Somali refugees and in the context of meat packing. The Migration Policy Institute reports that of the 70,000 refugees admitted annually, about 8,000 of them have recently been from Somali. Most apply for refugee status from the massive Dabaab network of camps in Kenya, which Kenya is trying to close down.

Meatpacking (or meat processing) evolved to become a major hirer of immigrants with little formal education. I’ve described this evolution here:

Consolation of the meat packing business into large processing plants, causing family and small employer operations to sharply decline.

Placement of the plants in rural areas. As of 2005, only one small meatpacking plant in Chicago was left.

Deskilling: “A formerly urban, unionized, and semiskilled workforce employed in production plants, supermarkets, and butcher shops in the 1950s was transformed into one with rural, mostly nonunion, and unskilled workers concentrated at the industrial processing end of the meat production chain by the end of the 1980s.” Workers with limited English proficiency can find jobs.

 

H-1B and the IT job market in California

May 22nd, 2016

“There isn’t a clearer cut case of adverse impacts – the American worker is losing his job to an H-1B.” The person quoted was referring to the decision by Southern California Edison (SCE) in 2015 to lay off hundreds of domestic IT workers, and then turn to temporary work visa firms to replace the workers with Indians.

The dispute over outsourcing of IT jobs to outsourcing firms is complicated by the lack of public information on the detailed economics of major players such as SCE, plus the inherent complexity of IT workforce management.

We need an in-depth analysis by some one willing to suspend judgment. See George Borjas’ blog posting here, in which he reviews some recent research. For him, the only real benefit to American workers would come when temporary STEM workers bring skills and knowledge which spills over onto domestic co-workers. In the SCE case, it’s highly unlikely this would happen, because per Borjas these H-1B workers aren’t that special.

SCE had about 1,800 employees, plus an additional 1,500 contract workers. The 2015 layoffs involved about 400 workers. SCE hired Infosys, from Bangalore, and Tata Consultancy Services, headquartered in Mumbai, for replacements. Terminated employees signed confidentiality and non-disparagement agreements.

The Economic Policy Institute reports that the ten top IT outsourcing firms doing business in California filled applications in 2015 for 69,000 temporary H-1B jobs.

Over two-thirds of H-1B visas are granted for systems analysis and programming jobs.

On February 25 of this year Ron Hira of the Economic Policy Institute testified to Senate Subcommittee on Immigration and the National Interest of the Judiciary Committee.

Hira has estimated that SCE and other H-1B workers are paid less than prevailing wages. He did not have access to actual wages of lay off workers. He did know what H-1B worker wages for SCE, – in the $65K – $70K range, which he compared to the Dept of Labor estimates of the average wage of “computer systems analyst” of $91,990. And he had an Aon-Hewitt compensation study showing that IT employees of SCE were paid above $100K.

Wage data for IT certainly suggests that SCE and other outsourcing companies are saving a bundle on wages. BLS data show there were 74,000 computer systems analysts in California in 2014 with an average salary of $99,000. There were 548,000 computer and mathematical jobs in total in the state, with an average salary of $102,000.

The Dept of Labor has determined that SCE did not violate the H-1B law.

How America ranks worldwide in migration

May 21st, 2016

Pew Research Center, drawing on data of immigrant populations compiled by the U.N., highlights several ways to rank America in immigration flows.

See the U.N. 2015 report here; it says that “the number of international migrants worldwide has continued to grow rapidly over the past fifteen years reaching 244 million in 2015, up from 222 million in 2010 and 173 million in 2000.”

The most immigrants. Survey data indicates there are about 41 million foreign-born people in the country (the UN estimates 46.6 million). The next largest foreign-born population is Germany, with 12 million. Note that India and China, countries with three or four times our population, has fewer foreign born.

The largest migration corridor. The U.S.-Mexico migration corridor is the world’s largest. About 12 million residents in the U.S. were born in Mexico. The second largest corridor consists of Indian nationals living in the United Arab Emirates, estimated to be 3.5 million migrants, 40% of whom come from one Indian state, Kerala.

Lower than Canada, Australia others in foreign-born penetration.  Other countries have a much greater share of residents who are foreign-born. We are at about 14%, compared to Canada (22%), Australia (28%) and Gulf countries, where over three quarters of the population are foreign born.

Relatively low share of American citizens live outside the country. More than 3 million people who were born in the U.S. now live in other countries, compared with nearly 16 million Indians who are emigrants. About 12 million Mexican-born people live outside of Mexico, Syria (5 million) and Poland (4.4 million) have larger emigrant populations. About 1% of Americans live outside the U.S, compared to UK (8%), Germany (5% and Canada (4%).

Donald Trump on illegals and the Wall

May 19th, 2016

The New York Times analyzes today the presidential candidate’s proposals about undocumented residents and the border with Mexico.

Deport them

According to the Pew Research Center, in 2014 there were 11.3 unauthorized persons in the country; 49% of them are Mexicans, whose numbers dropped from 6.9 million in 2007 to 5.6 million in 2014; they make up 5.1% of the workforce; and 7% of K-12 students had at least one unauthorized parent. What work these workers do is estimated here.

Trump says that his deportation measures will resemble Operation Wetback, the most recent mass-scale deportation program in the country, begun in 1954, and will be completed in two years. Currently the country deports about 400,000 persons a year.

“ ‘I can’t even begin to picture how we would deport 11 million people in a few years where we don’t have a police state, where the police can’t break down your door at will and take you away without a warrant,’ said Michael Chertoff, who led a significant increase in immigration enforcement as the secretary of Homeland Security under President George W. Bush.”

To prevent flight after arrest, the authorities would have to detain most immigrants awaiting deportation. Existing facilities, with about 34,000 beds, would have to be expanded to hold at least 300,000.

“ ‘Unless you suspend the Constitution and instruct the police to behave as if we live in North Korea,’ ” Mr. Chertoff said, “’it ain’t happening.’”

Build a Wall

“Mr. Trump has shared few details. He has said that the wall would be built from precast concrete and steel and that it could be 50 feet tall, if not higher. After calling for it to extend across the entire 2,000-mile southern border, he more recently said half that length could be sufficient because of natural barriers. He has pegged the cost at $4 billion to $12 billion, most recently settling on around $10 billion.” The Times article goes into the cost, logistics and eminent domain aspects of the proposal.

It also discusses water rights and recent history of Mexican-American relations. “The Colorado River sends water south; the Rio Grande, a natural boundary for hundreds of miles, delivers precious water from Mexico, through dozens of canals, to much of South Texas. Water experts in the Southwest question how Mr. Trump’s border wall could accommodate those crucial flows and still provide the barrier he wants.”

Felipe Vieira: a defrauded EB-5 investor

May 15th, 2016

The EB-5 funded development projects at Jay Peak and others sites on the Vermont – Canadian border are now emerging as the largest scandal in the history of the EB-5 program, which enables foreigners to buy permanent residency visas if they put up $500,000 and create ten jobs. The Vermont Digger reports on one Brazilian family whose lives are in turmoil due to the scandal. Go here for the initial posting which explains EB-5 and this project.

The Vermont Digger reported that about 400 investors out of a total of 700 in the Jay Peak and AnC Bio Vermont projects do not yet have permanent residency in the United States, according to documents provided to the court by the Vermont Department of Financial Regulation, which participated in the SEC investigation. The investors come from 74 different countries.

At a hearing in U.S. District Court in the Southern District of Florida in Miami, Securities and Exchange Commission lawyers presented the case of Felipe Vieira, an investor from Brazil, has started a new life in Stowe with his wife and daughter. Vieira said he saved for two years and sold his farm and an apartment building before he was able in 2012 to invest $500,000 in the Stateside project at Jay Peak. Vieira said he moved to the United States to give his daughter better educational opportunities.

Jay Peak’s CEO Bill Stenger had promised Vieira would make a return of 4% to 6% a year on his investment and Vieira had hoped to use the proceeds to help support his family in Vermont. The returns, however, were much lower than advertised. Instead of $20,000 a year (at 4%), Vieira made about $3,000 total.

Because the project has not been completed, and 10 jobs per investor have not been created per the EB-5 program requirements, the immigration status of investors like Vieira is in jeopardy.

Vieira said he visited Jay Peak to see how construction work was progressing. Stenger never told him construction workers had walked off the job because they hadn’t been paid. Nor was Vieira aware that Stenger and Quiros had siphoned off money from Stateside to pay for other projects. On Sept. 30, 2015, there was less than $60,000 in the Stateside bank account, according to the Vermont Department of Financial Regulation.

Vieira works as a financial analyst for the Agency of Transportation, and his daughter is a junior in high school. She is taking AP science classes in order to enroll as a pre-med student, he said.

He told the court that his conditional green card expires in September.

“If my permanent green card is denied, basically I have to dismantle all this life,” Vieira said.

Immigration an overlooked factor in the shrinking middle class

May 13th, 2016

The Pew Research Center reports that “From 2000 to 2014 the share of adults living in middle-income households fell in 203 of the 229 U.S. metropolitan areas…” Pew previously reported that “Fully 49% of U.S. aggregate income went to upper-income households in 2014, up from 29% in 1970. The share accruing to middle-income households was 43% in 2014, down substantially from 62% in 1970.”

(Income is defined as money income received exclusive of certain money receipts, such as capital gains, before payments for such things as personal income taxes, Social Security, union dues and Medicare deductions.)

The shrinkage is most easily seen in an article by Tom Edsall,  in which there is a graph showing that between 1970 and high + low middle classes shrank from 65% to 41%, upper income rose from 17% to 30% and lower income rose from 19% to 30%.

I cannot find in Pew’s analysis any mention of the rise in the immigrant population in the U.S. Between 1980 and 2010, the foreign born population in the country rose from 6.2% to 12.9%. The foreign-born share of the workforce from 6.7% to 16%. An explanation of the decline of the middle class can’t be sufficient without taking this demographic into account.

What Pew’s and everyone else’s analysis overlook, is that the foreign born workforce is distinctly more bi-modal than the native-born workforce. That is, this workforce has relatively more people in the lower and higher income segments and relatively less in the middle income brackets.  This workforce has grown faster — much faster — than the native born workforce, especially the white workforce.

This more bi-modal profile subsides in the second generation; that is, children of workers in 1980, who today are in there 20s to 40s, but on the whole college graduation remains much lower. It stands to reason that the increase in the immigrant workforce, both first and second generation, contribute, perhaps significantly, to shrinking the size of the middle-income brackets.

I turn to a Bureau of Labor Statistics report on labor force in 2014. As if often the case, the use of median or average figures obscures the distribution. But the BLS report has some figures that are worth looking at.

In 2014, 48.3% of the foreign-born labor force was Hispanic, and 24.1% was Asian.

This first table is typically how foreign and native born workers are compared. A much higher percentage of native born workers are in higher status jobs:

………………………………………management      service
Foreign born                            30.7%                   24.1%
Native born                              39.8%                   16.4%

The chart on  gives you a clue as to the bimodal profile of immigrants.

Now look at the following table showing the distribution of employed persons by educational attainment. Hispanics and Asians account for 72.4% of employed persons. Combined, they present a strikingly bi-modal profile compared to white non-Hispanic native-born workers.

…………………………………………………< HS     HS    < BA      BA plus
Hispanic foreign-born                            42%   29%    15%     14%
Asian foreign-born                                  7%    18%    15%     61%
Hispanic + Asian foreign-born              30%    25%    15%     30%
White non-Hispanic native-born              3%   26%    29%      42%

The bipolar profile reflects the estimates that foreign workers comprise 75% of hired farm labor and 32% of computer programmers.

Now, multiple generations of immigrants have been carefully studied. Among Hispanics, about 36% are first generation and 34% are second generation, and 30% older than second generation (see Chart 1, here). (I cannot find data on multi-generational Asians.) This means that total “Hispanic native born” is about 55% second generation and 45% third or older generation. The table below shows that educational attainment of native-born Hispanics is much improved. So is it the case with native-born Asians. The bi-modal profile of the groups combined disappears, but educational status combined remains well below that of native-born whites.

…………………………………………………< HS    HS   < BA   BA plus
Hispanic native-born                               10%   31%  33%    25%
Asian native-born                                      3%  13%  21%    62%
Hispanic and Asian native-born                 9%  28%  31%    31%

The foreign worker demographic has both grown tremendously and shifted internally in the past 30 to 40 years. A close look might show that the bipolar profile has increased, especially with the rapid growth of Asian immigrants. An explanation of the decline of the middle class can’t be sufficient without taking this demographic into account.

Milestones in foreign-born farm workers in America, 1900 – 2016

May 13th, 2016

“Agriculture is unlike most other key sectors of the North American economy in that its comparative advantage as rested on having access to abundant low skilled labor instead of the accumulation of human capital (education and skills)” From a Migration Policy Institute 2013 report on agriculture.

Today there are about 2.1 million farm workers, of which about 1.25 million are hired hands, and of these about 75%, or about 950,000 are foreign-born workers. This workforce size is comparable to the roughly 700,000 foreign-born cooks and 800,000 foreign born maids and housekeepers.

Milestones:

Late 19th Century: large numbers of farm workers were Chinese. Japanese and Filipino, but Chinese Exclusion Act of 1882 induces farm owners to import Mexican workers.

1920s – 1930s: American agra-business hires many of the roughly 150,000 new Mexicans crossing the border, most illegally. But economic troubles in U.S. lead to deportation of Mexican farm workers. Border control is re-organized and made tougher in 1924. Many Mexicans repatriated illegally. (California enacted in 2005 a formal apology.)

New Deal labor protection laws exclude farmworkers (such as Fair Labor Standards Act of 1938, and state workers’ compensation laws exclude farms.

1942 – 1964: Bracero guest worker program launched (term refers to Spanish word for manual labor), extended in 1951, terminated in 1964. Brought in 5 million legally authorized workers. averaging 200,000 per year. Law suits are still active to obtain illegally withheld compensation.

1954: Operation Wetback: in response to concern about illegal migration by Mexicans, this program repatriated over 3 million Mexicans.

1960s – 1970s: United Farm Workers was organized, led to 40% improvement in wages, then suffered from internal strife.

1980s – 1990s: Hispanic workers dominated hired farm labor; over 50% of California workers were undocumented. Hispanic workers expanded beyond fruits and produce to meat processing plants throughout U.S. Temporary visa programs (H2-A and H2-B) provided through today very small shares of Hispanic agriculture workforce.

1990s – present: continuing trade-offs between cheap Hispanic labor and mechanization See this 2007 posting which analyzes the state of the issue in 2007.

 

Amazing visualization of U.S. immigration since 1820

May 5th, 2016

Here it is. Here is the data in a pdf document.

By Max Galka. “Max Galka is an NYC-based entrepreneur (my newest project: FOIA Mapper), formerly a trader/modeler of financial and insurance risk. I’m fascinated by data visualization and the ways that data is transforming our understanding of the world. I spend a lot of time with my face buried in Excel, and when I find something interesting I write about it here and as a contributor for the Huffington Post.”

Census Bureau Infographic on Mexico, India and China immigration

May 3rd, 2016

Go here. Compares the three sources, 2006 – 2013.

 

Virginia and the Presidential Vote: more influenced by Hispanics and Asians

May 3rd, 2016

Virginia is increasingly a contested state in presidential elections, in part due to the rise of non-white eligible voters. This November, the percentage of eligible voters who are minority (Hispanic, Black and Asian), will be around 30% compared to 26% in 2008.

Between 2008 and 2014, eligible Hispanic voters as a share of all eligible voters rose from 3% to 4.6%. Eligible Asians rose from 3% to 5%. Eligible Blacks remained at 20%. Combined, eligible non-whites rose from 26% to 29%.

According to the NY Times, during the 2012 presidential election, when 71% of Virginia’s voters went to the polls, Obama carried 93% of the black vote, 64% of the Hispanic vote, and 66% of the Asian vote, according to exit polls.

Hispanics in Virginia are on average more formally educated than Hispanics in the country, notably in a much smaller share without a high school diploma (13% vs. 22%) and higher share of those with a college degree (27% vs. 16%). As for household income, 42% of Hispanic households in Virginia had incomes of $100,000 or more, vs. 23% nationwide.

Also, the potential Hispanic voting power has sharply increased. In 2014, Hispanics accounted for 4.6% of the eligible voters. 38% of the Hispanic population was eligible to vote, compared with 42% of the entire Hispanic population in the country. This is a marked improvement in Hispanic voting power in the state from 2008, when 2.7% of eligible voters were Hispanic, and 32% of Hispanics were eligible to vote. 32% of eligible Hispanic voters are naturalized citizens, rather than citizens at birth. (This is higher than Hispanics nationwide, at 25%).

In 2010, 6.4% of Virginians spoke Spanish as the primary language at home. Among Asians (Korean, Vietnamese, Chinese and Philippine), 2.5% spoken their native language at home.