Borjas on immigration’s impact on U.S. labor markets

George Borjas is an expert on immigration at the Harvard Kennedy School. He’s been analyzing the impact of immigration on the American job market. He refers to a “supply shock” of new immigrant arrivals starting in earnest in the 1980s. The total number of immigrants rose and in doing so shifted towards younger age. In-migration into the U.S., he and others found, lowered wages levels while increasing total employment. Some source countries saw their wage levels increase due to out-migration.

Borjas modeled the wage effects the immigrant influx 1990 – 2010. The model reported that the total hours worked by all high school dropouts rose by 25.9% and wages were adversely affected – lowered by 6.2% in the short run and 3.1% in the long run. It said that work hours of college graduates rose by 10.9%, with wages softened in the short run by 3.2% in the short run and 0.1% (i.e. nil) in the long run. (As this was a model, it didn’t reflect actual wage data.) Thus, more work for all and lower wages for some.

He also looked at changes in the employment rates of native-born Americans, legal immigrants and undocumented persons. The employment rate of the three groups was roughly similar in 1994, about 80%, but a marked divergence occurred afterward. The percentage of undocumented male workers employed went up from 80% in 1994 to 86% in 2014. Legal immigrants’ employment rate went up from 78% to 81%. Native-born Americans declined from 80% to 74%. He concluded that native-born Americans were the most sensitive to wage levels. Undocumented workers came here to work and do not withdraw from seeking employment if wages fall.

Borjas has looked at immigration in some pretty obscure areas, such as when 10% of the mathematicians emigrated from Russia after 1992, one third settling in the U.S. He found that the topics of papers written by the Russian immigrants and native-born Americans changed in response to this influx.

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