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February 18, 2014

Home Economics: the lives of domestic workers

The National Domestic Workers Alliance issued a report titled Home Economics which reveals much about the working conditions of domestic workers. A large share of domestic workers are immigrants.

Key findings in the report:

Domestic workers earn substandard pay, and enjoy little economic mobility or financial security.

Formal employment contracts are rare in the domestic work industry, and where work agreements do exist, employers frequently violate them.

Employers think of their homes as safe, yet domestic work can be hazardous.

Domestic workers who encounter problems frequently feel too vulnerable to stand up for themselves, especially live-in workers and undocumented immigrants.

The survey revealed that substandard working conditions are pervasive in the domestic work industry. Wage rates are low, the work is often hazardous, and workers rarely have effective recourse to improve substandard conditions.

A few of the facts in the report:

About a third of domestic workers nationwide are foreign born. About two thirds of domestic workers in major metropolitan areas are foreign born.
23 percent of workers surveyed are paid below the state minimum wage.
The median hourly wage of live-in workers is $6.15.
Less than 9 percent work for employers who pay into Social Security.
60 percent spend more than half of their income on rent or mortgage payments.
85 percent of undocumented immigrants who encountered problems with their working conditions in the prior 12 months did not complain because they feared their immigration status would be used against them.

October 28, 2013

Remittance flows: new World Bank report

The World Bank reports that remittance flows to developing countries are expected to reach $414 billion in 2013 and $540 billion by 2016 (total world remittances are expected to be $700 in 2016). The only case of decline has been Mexico, due to flat or negative migration to the United States. The average cost of sending remittances is 9%.

Total remittance flows in 2000 were estimated at under $100B, indicating the rapid growth of these flows.

Mexico is ranked as the 4th largest recipient in 2013, at $22B, after India ($71B), China ($60B) and the Philippines ($26B). Mexico’s remittance level is about 2% of its gross domestic product. Showing how much the Philippines is a worker-export economy, its remittance level is about 10% of its GDP.

The report had this to say about Mexico: It is going through a second year of absolute decline in remittances, but the bank expects the volume to return to growth shortly. The average remittance is about $300. Housing starts in the U.S. have been the classic indicator of remittance volume but that is no longer the case.

The unemployment rate of the Hispanic or Latino population in the U.S. declined from 10.1% in August 2012 to 9.2% in August 2013.Employment of foreign-born workers remains more responsive than native-born workers.

Remittance networks in Mexico have been engaged in some competitive price cutting – the report doesn’t describe further.

September 21, 2013

Why we must address immigrant work safety now

America is just now belatedly waking up to the reality that immigrant workers deserve far greater safety protections at work. RIsk & Insurance ran my column on this problem in its Sept.1, 2013 issue:

The rise of immigrant labor has been so incremental that it’s hard to pinpoint when the workers’ compensation community should have collectively realized that immigrant workers often pose a heightened work injury risk. But it’s clear that we are past that date.

Foreign-born workers (including legal and undocumented) comprised about one tenth of the country’s workforce in 1990. Today they amount to about 17 percent, and are much more widely distributed geographically.

Since 2000, foreign-born workers have added more bodies to the workforce than have native-born Americans. Demographers expect this trend to continue through 2020.

Many immigrants are very highly skilled. But a large share, those that are less well educated, provide manual labor that on balance is relatively injury-prone. These workers also have limited access to safer work.

Our manual workforce is thus segregated by injury risk. Pair an immigrant and a native-born worker, both doing jobs that require limited education, and statistics reveal that the foreign-born worker encounters twice the risk of work injury than the native.

I estimate from federal data that in the top 30 jobs that don’t require a high school education, immigrants sustain at least one out of every four injuries.

That’s based on an assumption that they report injuries at the same rate of native-born workers.

The immigrant worker is less inclined to have health insurance. Having health insurance is widely thought to lower work injury claims and to fund the treatment of co-morbidities which left untreated can complicate injury recovery.

In fact, the Affordable Care Act and the current version of the Senate’s Immigration Reform bill prohibit access for large numbers of non-naturalized immigrants to federally supported health insurance. That’s despite the fact they are here legally and paying taxes.

A lack of literacy in English further precludes immigrant workers from access to adequate healthcare and exposes them to a lack of understanding of safety procedures, making them even more vulnerable.
Many naturalized citizens speak their native language at home. Among non-citizens, only one tenth speak English at home. In fact, one third of non-citizen households, even after five years in the United States, fit the formal definition of being linguistically “isolated.”

We in the work safety and workers’ compensation fields have deflected the literacy problem for decades. We typically assign safety and injury response tasks to someone who speaks the worker’s native language. This induces co-workers towards learned ignorance.

Further isolating immigrant workers is fear on the part of employers of legal prosecution should they be found to harboring an illegal immigrant.

Employers fear if they are too proactive they will stumble over an undocumented worker and incur legal liability. Millions of supervisors therefore lack the education to effectively manage immigrant workers.

One positive step for employers would be to adhere to a timidly publicized OSHA requirement that “instruction must be provided in a language the employee can understand.”

Another step is for medical provider networks to expect that their providers adhere to a requirement arising out of the 1964 Civil Rights Act that health professionals conduct patient encounters in the preferred language of the patient.

We have a yet more difficult step ahead. Some say we are a multi-ethnic society.

But, as with much of the world, we are moving towards a trans-national society. Millions of American residents including even naturalized citizens see themselves as members of two societies. Many of our workers are trans-nationals, not permanent immigrants per the iconic Ellis Island narrative.

To ensure work safety and injury recovery, we may need to devote a lot more attention to buying into the culture of the foreign-born workers rather than waiting for the worker to learn how to speak and act live a native

February 20, 2013

Remittances from the United States: big, getter fairer

Remittances from the U.S. to other countries continue to grow. And new Feb 2013 regulations on remittances, created out of the Dodd-Frank Act, seek to impose better controls to protect the sender.

The Congressional Budget Office estimated in 2011 that in 2009 remittances from the United States to other countries totaled more than $48 billion, nearly 30 percent more in inflation-adjusted terms than they were in 2000. This outflow is over 10% of total worldwide remittances. According to the Economist, remittances from the U.S. make up about 15% of the total GDP of Haiti, El Salvador and Honduras. It appears that about 2% of Mexico’s GDP is remittances from the U.S.

In 2009, such remittances from the United States to other countries totaled more than $48 billion, nearly 30 percent more in inflation-adjusted terms than they were in 2000. People in Mexico receive more of the remittances sent from the United States than do residents of any other country.

CBO 2011 report excerpts:

Of the $48 billion in remittances in 20098, nearly $38 billion of that amount was personal transfers by foreign-born residents in the United States to households abroad. The rest, about $11 billion, reflected the compensation of employees who were in the United States for less than a year.

Here are excerpts from a late 2012 report by the World Bank on remittances, which includes a summary of new U.S. remittance rules effective 2/7/13.


Overview of World Bank report

Officially recorded remittance flows to developing countries are estimated to reach $406 billion in 2012, a growth of 6.5 percent over the previous year. These flows are expected to rise 8% in 2013 and 10% in 2014 to reach $534 billion in 2015.

 Remittance costs are still too high, averaging 7.5% in top 20 remittance corridors; the worldwide average cost is about 9%.

 US Remittance Transfer Rule, to be implemented in February 2013, will increase transparency for consumers and thereby market competition.


Facts about remittance flows

Officially recorded remittances to developing countries are expected to reach $406 billion in 2012, up by 6.5% from $381 billion in 2011(figure 1 and table 1). The true size of remittance flows, including unrecorded flows through formal and informal channels, is believed to be significantly larger. Compared to private capital flows, remittance flows have shown remarkable resilience since the global financial crisis, registering only a modest fall in 2009, followed by a rapid recovery. The size of remittance flows to developing countries is now more than three times that of official development assistance.

The top recipients of remittances in 2012 are India ($70 billion), China ($66 billion), the Philippines ($24 billion), Mexico ($24 billion), and Nigeria ($21 billion).

Continue reading "Remittances from the United States: big, getter fairer" »

February 7, 2013

Do undocumented workers pay taxes? Answer: Most do today.

The Congressional Budget Office addressed this question in a December, 2007 report. It appears that among undocumented workers, which the CBO estimates t 7.2 million, between 50% and 75% pay income, Social Security and Medicare taxes.

A 2005 New York Times article estimates that undocumented workers are “generating $6 billion to $7 billion in Social Security tax revenue and about $1.5 billion in Medicare taxes.”

From the CBO report:

First, how many undocumented workers are there? Using data from the Census Bureau’s March 2005 Current Population Survey (CPS), Pew analysts found that of the approximately 11 million unauthorized immigrants living in the United States in 2005, 5.4 million were adult males, 3.9 million were adult females, and 1.8 million were children under 18 years of age. An additional 3.1 million children of unauthorized immigrants were U.S. citizens, Pew estimated. The unauthorized population included 7.2 million workers, typically employed in lower-wage occupations in the agricultural, construction, and service industries.

Data from the Social Security Administration (SSA) and the Internal Revenue Service (IRS) suggest that some unauthorized immigrants use false or fraudulently obtained Social Security numbers (SSNs) to satisfy paperwork requirements during the hiring process and that employers use those numbers to withhold federal, state, and local income and payroll taxes for employees. Workers who do not qualify for SSNs can use Individual Tax Identification Numbers issued by the IRS to file tax returns, make payments, and apply for refunds. Although there are no reliable data on unauthorized immigrants’ rate of compliance with tax laws, the IRS estimates that about 6 million unauthorized immigrants file individual income tax returns each year.23 Other researchers estimate that between 50 percent and 75 percent of unauthorized immigrants pay federal, state, and local taxes.

For example:

The SSA assumes that about half of unauthorized immigrants pay Social Security taxes.

Several of the states whose estimates CBO reviewed used a model developed by the Institute for Taxation and Economic Policy (ITEP) to determine state and local taxes paid by unauthorized immigrants. ITEP assumes a 50 percent compliance rate for income and payroll taxes.

Researchers from the Urban Institute, the Migration Policy Institute, the Pew Hispanic Center, and the Center for Immigration Studies have assumed a 55 percent compliance rate for income, Social Security, and Medicare taxes.

As part of a larger study on migration, the Center for Comparative Immigration Studies at the University of California at San Diego conducted a survey of unauthorized immigrants and found that, in 2006, 75 percent had taxes withheld from their paychecks, filed tax returns, or both.

January 9, 2013

Wealth of 2011 data on foreign born workers

Foreign born workers are about 2/3 non-citizens and 1/3 citizens. The Bureau of Labor Statistics issued in mid 2012 a wealth of data on all foreign-born workers. it is not feasible to fairly summarize from even the press release, included below, but here are a few quick facts for 2012: 24.4 million foreign born persons in the labor force, or 15.9% of total; half are Hispanics’ one fifth are Asians; average compensation 22% less than native born (but the average disguises and hourglass profile of immigrant workers – many low wage, a good number high wage). The survey includes undocumented workers as well as all others.

The press release is below. The BLS page with many reports listed is here.

FOREIGN-BORN WORKERS: LABOR FORCE CHARACTERISTICS -- 2011

Technical information: (202) 691-6378 * cpsinfo@bls.gov * www.bls.gov/cps
Media contact: (202) 691-5902 * PressOffice@bls.gov


The unemployment rate for the foreign born was 9.1 percent in 2011, down from 9.8 percent in 2010, the U.S. Bureau of Labor Statistics reported today. The jobless rate of the native born was 8.9 percent in 2011, compared with 9.6 percent in the prior year. The foreign born made up 15.9 percent of the labor force.

Data on nativity are collected as part of the Current Population Survey (CPS), a monthly sample survey of approximately 60,000 households. The foreign born are persons who reside in the United States but who were born outside the country or one of its outlying areas to parents who were not U.S. citizens. The foreign born include legally-admitted immigrants, refugees, temporary residents such as students and temporary workers, and undocumented immigrants. The survey data, however, do not separately identify the numbers of persons in these categories. For further information about the survey, see the Technical Note.

Highlights from the 2011 data:

-- In 2011, there were 24.4 million foreign-born persons in the U.S. labor force, comprising 15.9 percent of the total. (See table 1.)

-- Hispanics accounted for 49.0 percent of the foreign-born labor force in 2011. Asians accounted for 22.3 percent. (See table 1.) (Data in this news release for persons who are white, black, or Asian do not include those of Hispanic or Latino ethnicity. Data on persons of Hispanic or Latino ethnicity are presented separately.)

-- Foreign-born workers were more likely than native-born workers to be employed in service occupations; production, transportation, and material moving occupations; and natural resources, construction, and maintenance occupations. (See table 4.)

-- The median usual weekly earnings of foreign-born full-time wage and salary workers were $609 in 2011, compared with $780 for their native-born counterparts. (See table 5.) (Differences in earnings reflect a variety of factors, including variations in the distributions of foreign-born and native-born workers by educational attainment, occupation, industry, and geographic region.)

Continue reading "Wealth of 2011 data on foreign born workers" »

January 6, 2013

Key findings about immigration’s economic impact

Sari Pekkala Kerr and William Kerr wrote an article “The Economic impacts of immigration: a survey” (see citation below) in which they report on their review of many studies of economic impact. Most of these studies were on Europe, and some on the United States. Here is a summary of their findings:

Globally, the U.S. has a very high immigrant population share:

Some 3% of the world’s population live permanently outside their country of birth. In Europe, the foreign born population is about 7%. In the U.S., 13% of the population is foreign born, (These figures include people who have become naturalized in their host country.) Therefore, both Europe and the U.S. have a much higher share of foreign born nationals than the rest of the world –perhaps a reflection of the very low such shares in India and China.

Immigrants today greatly contribute to workforce growth in the U.S and Europe, but they do not appreciably reduce the demographic shift to the elderly.

Immigrant earnings start low, then rise.

The findings are somewhat cloudy. This is in part due to the fact that one quarter of more of foreign born persons eventually leave (“re-migration”), perhaps back to their country of origin. At their outset in their new country (Europe and the U.S.) the foreign born earn less.

The most recent findings report that immigrant-native wages gaps tend to close over time but overall do not disappear. To the extent that less successful immigrants may be disproportionately left the receiving country, the wage improvement trend may be exaggerated. We do not know the precise mechanisms by which this wage gap narrows. Children of immigrants to the U.S. assimilate well economically.

Immigration has a downward effect on U.S. born worker wages, but the amount is debatable:

“The likelihood and magnitude of adverse labor market effects for natives from immigration are substantially weaker than often perceived….the parts of the population most typically affected are the less educated natives or the earlier immigrant cohorts.”(page 25)

Credible studies showing a very modest effect include the 1980 Mariel boatlift from Cuba to Miami (1); 1962 repatriation of French returning from Algeria; and the impact of Russian Jews moving to Israel after 1990. However, Princeton-based expert George Borjas estimates that there is a nationwide adverse effect that might not be noticed in a particular locality.

(1) From George Borjas: “In April 1980, when Fidel Castro declared that Cubans wishing to emigrate could leave from the port of Mariel, 125,000 people accepted the offer and Miami’s labor force suddenly grew by 7 percent. Yet, the trends in wages and unemployment rates in Miami between 1980 and 1985, including those of black workers, resembled those observed in comparable cities.”

Source: Finnish Economic Papers. Spring 2011 24 (1)

December 14, 2012

Large share of small business owners are immigrants

A New York Times editorial summarizes the elevated role of immigrants in running small businesses in the U.S. It cites a study by the Fiscal Policy Institute.

According to the study, 28% of leisure and hospitality business owners are immigrants. They are 53% of all gas station owners and 49% of all grocery store owners. One third of small businesses in California are immigrant-owned.

The Times’ summary says that “The study found that there were 900,000 immigrants among small-business owners in the United States, about 18% of the total. This percentage is higher than the immigrant share of the overall population, which is 13%, and the immigrant share of the labor force, at 16%. Small businesses in which half or more of the owners were immigrants employed 4.7 million people in 2007, the latest year for which data were available, generating $776 billion in receipts.”

They accounted for 30 % of the growth in small businesses — those with fewer than 100 employees — between 1990 and 2010.

Immigrant entrepreneurs are concentrated in professional and business services, retail, construction, educational and social services, and leisure and hospitality. They own restaurants, doctor’s offices, real-estate firms, groceries and truck-transportation services. More of them come from Mexico than any other country, followed by Indians, Koreans, Cubans, Chinese and Vietnamese.

November 27, 2012

Trafficking: what is it?

The Victims of Trafficking and Violence Protection Act of 2000 defines trafficking, debt bondage, and involuntary servitude. Today, at least several millions are subjected to one or more of these human abuses.

The act’s intent is “to combat trafficking in persons, especially into the sex trade, slavery, and involuntary servitude, to reauthorize certain Federal programs to prevent violence against women, and for other purposes.”

On October 1, 2012, the act expired. The Trafficking Victims Protection Reauthorization Act of 2011 (S. 1301) to extend funding for anti-trafficking programs has not yet been voted on by either Senate or House (as of 11/27/12). Congress reauthorized the act in 2003, 2005 and 2008.

Section 103 Definitions

(8) SEVERE FORMS OF TRAFFICKING IN PERSONS- The term `severe forms of trafficking in persons' means--

(A) sex trafficking in which a commercial sex act is induced by force, fraud, or coercion, or in which the person induced to perform such act has not attained 18 years of age; or

(B) the recruitment, harboring, transportation, provision, or obtaining of a person for labor or services, through the use of force, fraud, or coercion for the purpose of subjection to involuntary servitude, peonage, debt bondage, or slavery.

(9) SEX TRAFFICKING- The term `sex trafficking' means the recruitment, harboring, transportation, provision, or obtaining of a person for the purpose of a commercial sex act.

Also….

(4) DEBT BONDAGE- The term `debt bondage' means the status or condition of a debtor arising from a pledge by the debtor of his or her personal services or of those of a person under his or her control as a security for debt, if the value of those services as reasonably assessed is not applied toward the liquidation of the debt or the length and nature of those services are not respectively limited and defined.

(5) INVOLUNTARY SERVITUDE- The term `involuntary servitude' includes a condition of servitude induced by means of--

(A) any scheme, plan, or pattern intended to cause a person to believe that, if the person did not enter into or continue in such condition, that person or another person would suffer serious harm or physical restraint; or

(B) the abuse or threatened abuse of the legal process.

Continue reading "Trafficking: what is it?" »

November 15, 2012

Indian immigrants and American hotels

Indian immigrants in 2004, according to Reuters, owned one half of the hotels in the United States. The Asian American Hotel Owners Association has more than 10,000 members owning more than 22,000 hotels with a total of $60 billion in property value. AAHOA is the largest membership-based Indian business organization in the United States

The 1965 Immigration Act opened the doors for many more Indian immigrants.
Indians got into the hotel business in the 1970s, when due to gas shortages Americans traveled less and hotel owners were willing to sell their properties for less. The buyers would invest $10,000 or $20,000 as a down payment in a hotel property worth about $100,000 to $120,000. Most of the Indian owners are from Gujarat state.

"The network gave them a business plan," said one observer. “They didn't need consultants. All a potential investor had to do was call up his uncle and ask, 'How much should I pay and is this a good market?'."

lower-budget (broadly defined) motel brands that Indian Americans commonly own include Comfort Inn, Days Inn, EconoLodge, Knights Inn, Sleep Inn, Super 8, and Travelodge, to name a few. Middle-budget motels include Best Western, Country Inn and Suites, Hampton Inn, and Holiday Inn (and Express).

October 5, 2011

Colorado farmer can’t find local workers to replace Hispanic immigrants

This from the NY Times: “John Harold found himself short of workers to harvest his corn and onions after he decided to try to hire more local residents and fewer foreign laborers for his 1,000-acre farm." The local workers quit in six hours.

The article in full:

By Kirk Johnson
Published: October 5, 2011

OLATHE, Colo. — How can there be a labor shortage when nearly one out of every 11 people in the nation are unemployed?

That’s the question John Harold asked himself last winter when he was trying to figure out how much help he would need to harvest the corn and onions on his 1,000-acre farm here in western Colorado.

The simple-sounding plan that resulted — hire more local people and fewer foreign workers — left Mr. Harold and others who took a similar path adrift in a predicament worthy of Kafka.

The more they tried to do something concrete to address immigration and joblessness, the worse off they found themselves.

“It’s absolutely true that people who have played by the rules are having the toughest time of all,” said Senator Michael Bennet, a Democrat from Colorado.

Mr. Harold, a 71-year-old Vietnam War veteran who drifted here in the late ’60s, has participated for about a decade in a federal program called H-2A that allows seasonal foreign workers into the country to make up the gap where willing and able American workers are few in number. He typically has brought in about 90 people from Mexico each year from July through October.

This year, though, with tough times lingering and a big jump in the minimum wage under the program, to nearly $10.50 an hour, Mr. Harold brought in only two-thirds of his usual contingent. The other positions, he figured, would be snapped up by jobless local residents wanting some extra summer cash.

“It didn’t take me six hours to realize I’d made a heck of a mistake,” Mr. Harold said, standing in his onion field on a recent afternoon as a crew of workers from Mexico cut the tops off yellow onions and bagged them.

Continue reading "Colorado farmer can’t find local workers to replace Hispanic immigrants" »

June 23, 2011

To boost economy, boost immigration


Megan McArdle, the libertarian pundit at the Atlantic Monthly, did a (partly) tongue in cheek posting today pitching for vastly greater immigration to boost the economy. Here it is, with the research abstracts at the end:

Tim Pawlenty Can Get 5% Growth (but He Needs Immigrants to Help)
Posted: 22 Jun 2011 07:40 AM PDT

On April 20, 1980, Fidel Castro made an important contribution to the social sciences. His unexpected declaration that the port of Mariel would be temporarily open to any Cubans seeking to flee the island served as a natural experiment that has helped labor economists understand the impact of immigration. In his now classic paper, economist David Card [SEE ABSTRACT BELOW] convincingly showed that the massive influx of 120,000 Cubans increased the labor force of Miami by 7% yet had almost no impact on the employment or wages of natives.

This result is probably shocking to many, and certainly runs contrary to the popular but unfortunate myth that immigrants "steal our jobs". But while this study is an important result in the literature, it is not an isolated one. Most research on immigration shows small or zero impacts on unemployment and wages. This, however, does present something of a puzzle: if immigration increases labor supply, then why didn't wages fall and unemployment rise? How was it that the labor market in Miami was able to absorb so many new workers?

Immigration has little impact on wages and employment. But a 10% increase in immigration drives up house prices by 1%.

One important reason is that immigrants aren't just workers, but also consumers. Economists Bodvarsson, Lewer, and Van den Berg studied [SEE ABSTRACT BELOW] the Mariel boatlift and found that migrants increased labor demand enough to offset the increase in labor supply so that there was no negative impact on natives that one might otherwise expect when labor supply increases drastically. This result shouldn't be surprising. Immigrants buy stuff, that means businesses sell more, and they need to expand and hire new workers.

What does this have to do with Tim Pawlenty? He recently came under criticism for suggesting that he could make GDP grow 5% per year. But if immigration, even large influxes of unskilled immigration, has zero or a very small effect on wages and employment of natives, then it's actual pretty easy to make GDP grow 5% a year: just increase immigration until that happens. If we're expecting 2.5% real GDP growth a year, then increase immigration by 2.5%. If we're expecting 1.5%, then increase it by 3.5%. This shouldn't be too hard considering there are 145 million adults worldwide who would like to come here.

The bonus here is that aside from the affect on overall consumer demand, immigration has a particularly large impact on the demand for housing. Research by Albert Saiz has shown that a 10% increase in immigration drives up house prices by 1%. Whatever immigration research you're looking at, this is an order of magnitude larger than the labor market effects. This is important because immigrants tend to migrate to areas where there are already large numbers of immigrants. This means some of the worst housing markets will benefit the most from more immigration. will benefit the most. For instance, California, Nevada, Florida, and Arizona, are ranked 1st, 4th, 5th, and 9th by percent of population foreign-born. Since falling house prices are hurting the wider economy, the economic benefits of immigration would have secondary positive effects on GDP.

Is an increase in immigration what Tim Pawlenty had in mind when he promised 5% GDP growth? I doubt it. But if he was serious about his promise, he'd take a lesson from the Cuban immigrants of the Mariel boatlift and embrace one of the few ways that he could actually achieve that kind of growth.

David Card, The Impact of the Mariel Boatlift on the Miami Labor Market,
Industrial and Labor Relations Review, Vol. 43, No. 2. (Jan., 1990), pp. 245-257.

On the web at: http://www.econ.berkeley.edu/%7Ecard/papers/mariel-impact.pdf

Abstract:

Using data from the Current Population Survey, this paper describes the effect of the Mariel Boatlift of 1980 on the Miami labor market. The Mariel immigrants increased the Miami labor force by 7%, and the percentage increase in labor supply to less-skilled occupations and industries was even greater because most of the immigrants were relatively unskilled. Nevertheless, the Mariel influx appears to have had virtually no effect on the wages or unemployment rates of less-skilled workers, even among Cubans who had immigrated earlier. The author suggests that the ability of Miami's labor market to rapidly absorb the Mariel immigrants was largely owing to its adjustment to other large waves of immigrants in the two decades before the Mariel Boatlift.


Bodvarsson et al Measuring Immigration's Effects on Labor Demand: A Reexamination of the Mariel Boatlift, University of Nebraska-Lincoln and IZA
Discussion Paper No. 2919 July 2007

On the web: ftp://repec.iza.org/RePEc/Discussionpaper/dp2919.pdf

Abstract:

It is now well known that exogenous immigration shocks tend to have benign effects on native employment outcomes, thanks to various secondary adjustment processes made possible by flexible markets. One adjustment process that has received scant attention is that immigrants, as consumers of the goods they help produce, contribute to their own demand. We examine the effects of an immigration shock on labor demand by testing a general equilibrium model in which imperfectly substitutable native and immigrant workers spend their wages on a locally produced good. The shock induces three responses: (i) a substitution of immigrants for natives; (ii) out-migration; and (iii) stimulation of labor demand. According to (iii), native wages can fall, stay the same or rise, depending upon the strength of the shock and various product and factor market elasticities. As our test case, we reexamine the 1980 “Mariel Boatlift,” using Wacziarg’s “Channel Transmission” methodology. Our data set includes approximately 6,600 observations for 1979-85 from the Current Population Survey on workers in 9 different retail labor markets and Survey of Buying Power data on retail spending by consumers in Miami and four comparison cities. Our results provide a more complete explanation for why the Boatlift’s overall effects on native wages in Miami were benign: Lower wages due to greater labor supply were offset by higher wages due to greater labor demand. We conclude that the demand-augmenting effect of an immigration shock is a significant secondary adjustment process that must be considered when assessing the distributional effects of immigration.

February 3, 2010

The recession's inpact on immigration

The Migration Policy Institute released this brief statement: The effect of the recession on immigrants in the United States has been deepened by the fact that many immigrants share demographic characteristics with the groups most vulnerable during a recession — young people, individuals with lower levels of education, and those who have recently entered the labor force. Foreign-born workers are also overrepresented in the industries that have been hit the hardest during the recession, such as construction, manufacturing, leisure and hospitality, and support and personal services.

In particular, those from Mexico and Central America have been affected disproportionately. Many worked in the construction industry, which started collapsing after the housing bubble burst in late 2006.

In addition, many recent refugees, including those from Iraq, have struggled to find work due to the recession. Their precarious situation prompted advocacy groups to criticize the funding of US refugee resettlement programs and to point to the lack of sensitivity shown to this group's vulnerability during an economic downturn.

These impacts have been lessened to some extent by the fact that immigrants are generally more flexible about changing jobs and geographic locations than are native-born workers.

The sluggish economy has also made the United States less attractive for those seeking economic opportunities. Data suggest that immigration to the United States began to slow in late 2007 and that flows of unauthorized immigrants have decreased significantly.

However, there is no evidence that the recession has caused a substantial wave of returns to Mexico. Over the last year, the size of the unauthorized population, of which the largest share (59 percent) is Mexican, has decreased only slightly, from an estimated 12.1 million in July 2008 to 11.9 million in August 2009.

In an interesting twist, anecdotal evidence suggests that some Mexican families have sent money to support their family members in the United States.

Another impact of the recession has been decreased demand for H-1B temporary visas for highly skilled workers. In previous years, the 65,000 cap has been reached within the first few days the visas become available (see Figure 4). The cap for fiscal year 2010 was not met until December 21, 2009 — nearly nine months after employers were eligible to file fiscal year 2010 petitions.

January 9, 2010

Poor labor protections for low wage labor in Los Angeles


I posted in December on a survey conducted on low wage (about $8 an hour) immigration and native American labor in several cities. This article in the LA Times addresses the findings in that area. “The study found that almost nine out of 10 low-wage workers surveyed in Los Angeles County had recently experienced some form of pay-related workplace violation, or "wage theft." Almost one in three reported being paid less than the minimum wage and nearly 80% said they had not received legally mandated overtime.”

“Only 4.3% of Los Angeles respondents who had experienced a serious on-the-job injury during the previous three years had filed a workers' compensation claim to pay for medical care or missed days of work, the study found.”

The article in full:
By Patrick J. McDonnell

January 6, 2010

Low-wage workers in the Los Angeles area are even more likely than their counterparts in New York and Chicago to suffer violations of minimum wage, overtime and other labor laws, according to a new UCLA study being released today.

The study found that almost nine out of 10 low-wage workers surveyed in Los Angeles County had recently experienced some form of pay-related workplace violation, or "wage theft." Almost one in three reported being paid less than the minimum wage and nearly 80% said they had not received legally mandated overtime.

"We knew these violations were happening, but we never really imagined it was as prevalent as this study demonstrates," said Ruth Milkman, a sociologist and principal author of the study, conducted by UCLA's Institute for Research on Labor and Employment.

Continue reading "Poor labor protections for low wage labor in Los Angeles" »

December 6, 2009

How do illegal immigrants fit into the American economy?


The Migration Policy Institute issued in November a study of “The Economics and Policy of Illegal Immigration in the United States”, by Gordon H. Hanson of University of California-San Diego. Hanson is an expert in transnational immigration. Illegal immigrant workers, now numbering about 8.3 million, are mostly from Mexico and mostly have not completed high school. How do these illegal workers fit into the American economy? Hanson asks.

He writes that illegal immigrants add 0.03% to the gross domestic product, and cost 0.1% in educational and healthcare expenses (by far the leading economic burdens these worker households impose). This means they are a 0.7% drag on the economy, or about $10 billion. Border control expenses of the federal government is $9.5 billion.

He writes that they make up much of the ranks of poorly educated workers. “Over the last 50 years, the United States has raised the education level of its adult population dramatically. Whereas in 1960 half of US-born working-age adults had not completed high school, today the figure is just 8 percent….Forty- seven percent of unauthorized immigrants between 25 and 64 years of age have not completed the equivalent of a US high school education; they account for 20 percent of working-age adults in the United States with less than a high school degree.

“In 2008, they represented 25 percent of farm workers, 19 percent of building and maintenance staff, 17 percent of construction labor, 12 percent of employees in food preparation and serving, 10 percent of production labor, and 5 percent of the total civilian labor force.”

(These figures are from Jeffrey S. Passel and D’Vera Cohn, A Portrait of Unauthorized Immigrants in the United States (Washington, DC: Pew Hispanic Center, 2009).

September 8, 2009

Study of low income workers in New York City: violations of worker protections


Unregulated Work in New York City was published in 2007 by the Brennan Center At New Yorl University Law School, principal author Annette Bernhardt. This study analyzes numerous ways by which worker protections are being compromised by employers. . The study was “product of three and a half years of intensive research conducted in New York City between 2003 and 2006.”

Of the 326 persons interviewed, the distribution of respondents was: 116 workers; 84 employers; 10 staff members of governmental regulatory agencies; 19 staff members of labor unions; 22 staff members of policy advocacy organizations; and 75 staff members of other non-profit organizations, including legal services providers, social services providers, and community-based organizations.

Groceries and supermarkets, Retail, Restaurants, Building maintenance & security,
Publicly-subsidized child care, Domestic work, Home health care, Residential construction, Food and apparel manufacturing, Laundry and dry cleaning, Taxis and dollar vans, Auto repair, garages and car washes and Personal services such as nail and beauty salons were covered.

Annette Bernhardt, Ph.D., is Deputy Director of the Brennan Center’s Justice Program and co-directs its Economic Justice Project. She coordinates the Center’s policy analysis and research for national and local campaigns around living wage jobs, workers’ rights, and accountable development. Her books include Low-Wage America: How Employers are Reshaping Opportunity in the Workplace as well as Divergent Paths: Economic Mobility in the New American Labor Market, which was awarded Princeton University’s Lester Prize for the best new work in labor economics in 2002.

Here is a summary of the study’s scope:

Our fieldwork identified eight broad categories of workplace violations being committed by some employers in New York City:

• Wage and hour violations: We documented employers paying less than the minimum wage, failing to pay overtime, not paying at all, forcing employees to work off the clock, not giving breaks, stealing workers’ tips, and violating prevailing wage laws on public construction projects.
• Health and safety violations: We documented employers failing to provide guards on machinery, allowing extreme temperatures and improper ventilation, requiring employees to work on unsafe scaffolding, exposing them to chemical and airborne toxins, and failing to provide goggles, masks, and other protective equipment.
• Workers’ compensation violations: We documented employers failing to carry workers’ comppensation insurance required by law, and preventing injured workers from filing workers’ compensation claims
• Retaliation and violations of the right to organize: We documented employers firing or punishing workers who sought to improve working conditions, as well as making pre-emptive threats to report workers to immigration authorities.
• Independent contractor misclassification: We documented employers misclassifying their workers as independent contractors in order to evade their legal obligation under employment and labor laws.
• Employer tax violations: We documented employers either fully or partially failing to pay required payroll taxes on cash wages.
• Discrimination: In our research, discrimination on the basis of race, gender, country of
origin and criminal history manifested itself in firing, hiring, promotion, and in the explicit sorting of workers into stereotyped occupations.
Trafficking and forced labor: While not the focus of our research, we documented instances of workers being trafficked and being prevented from leaving their jobs through passport seizure, debt bondage, threats, physical force, or captivity.


September 2, 2009

New study on exploitation of low wage workers


A new study, Broken Laws, Unprotected Workers, reports widespread violations of wage and workers compensation laws among low wage workers. The study, conducted in early 2008 with 4,387 workers, was divided among illegal immigrants (39%), legal immigrants (31%) and native Americans (30%).

The median was a little over $8 an hour. 26% of the workers had been paid less than the minimum wage the week before being surveyed and that one in seven had worked off the clock the previous week. 76% of those who had worked overtime the week before were not paid their proper overtime, the researchers found. A large majority of injured workers did not report their injuries into the workers compensation system.

In instances when workers’ compensation should have been used, the study found, one third of workers injured on the job paid the bills for treatment out of their own pocket and 22 percent used their health insurance. Workers’ compensation insurance paid medical expenses for only 6 percent of the injured workers surveyed, the researchers found.

The New York Times article on the study:

Low-Wage Workers Are Often Cheated, Study Says
By STEVEN GREENHOUSE

Low-wage workers are routinely denied proper overtime pay and are often paid less than the minimum wage, according to a new study based on a survey of workers in New York, Los Angeles and Chicago.

The study, the most comprehensive examination of wage-law violations in a decade, also found that 68 percent of the workers interviewed had experienced at least one pay-related violation in the previous work week.

Continue reading "New study on exploitation of low wage workers" »

July 29, 2009

Another study of foreign born entrepreneurs in the U.S.

“High tech immigrant entrepreneurship in the United States” is a study published this month (July 2009) under the auspices of the Small Business Administration. The study confirms and elaborates on the role of foreign-born workers in high tech startups.

Its executive summary:

In this study, we quantify the role of immigrants in high-tech entrepreneurship in the
United States. We report the results of a survey of a nationally representative sample of rapidly growing high-impact, high-tech companies.1 This group of companies is very important to the U.S. economy, because they account for a disproportionate share of job creation and economic growth. We find that about 16% of the companies in our sample had at least one foreign-born person among their founding teams. This estimate is lower than that found in most previous studies of high-tech immigrant entrepreneurship. Nonetheless, our data show that immigrants play a crucial role in this vital economic activity.

High-impact, high-tech companies founded by immigrant entrepreneurs and those founded by native-born entrepreneurs in our sample are similar in many ways. They operate in the same industries and are about the same size. One important difference between the two is their location. Immigrant-founded companies tend to be located in states that have large immigrant populations.

Another difference is that immigrant-founded companies in our sample are about twice as likely as native-founded companies to state that they have a strategic relationship with a foreign firm, such as a major supplier, key partner, or major customer.

Immigrant-founded companies may also have a higher level of technological
performance than native-founded companies, although the evidence on this issue is not conclusive.

This study sheds light on high-tech immigrant entrepreneurs as individuals as well as on the companies that they helped to found. The vast majority of these individuals are strongly rooted in the United States. A large proportion of them have lived in this country for two decades or more. More than three-quarters of them are U.S. citizens. Two-thirds of them received undergraduate or graduate degrees here. The 250 foreign-born entrepreneurs on whom we have data hail from 54 countries in all regions of the world. India is the largest source country, accounting for 16% of this group, followed by the U.K. at 10%.

July 16, 2009

Did ICE enforcement lead to worker unionization at Smithfield?

Such may be the case with The Smithfield pork plant in Tar Heel, NC. The United Food and Commercial Workers Union has been trying get unionize the plant for over a decade. Many of the workers were illegal. ICE raided the plant in January 2007. In late 2008, with the ranks filled by American workers, the workforce voted to unionize. The point: legalization of the workforce can lead to better protection of labor. The Center for Immigration Studies issued as report on the Smithfield plant this month.

The article in full:

“Immigration Raids at Smithfield: How an ICE Enforcement Action Boosted Union Organizing and the Employment of American Workers”, By Jerry Kammer

Jerry Kammer is a Senior Research Fellow at the Center. Before joining CIS he was a reporter with Copley New Service where he won a Pulitzer Prize in 2006. He has covered immigration and border issues for more than 20 years.

Summary

In January 2007, Immigration and Customs Enforcement (ICE) agents raided the Smithfield pork plant in Tar Heel, N.C. Seven months later, ICE agents made more arrests at workers’ homes in surrounding areas. Other illegal workers, fearing they might be detained, left the plant on their own.

If they are concerned about working-class Americans, partisans on either side of the immigration debate can find something to support their positions in the events at Tar Heel.

On the one hand, those who favor using law enforcement to force illegal immigrants out of jobs can point to the fact that enforcement at Tar Heel created job openings for native-born Americans and legal immigrants. Had the illegals remained in the jobs, they would not have been available to American workers. One can also note that enforcement turned out to be a key factor in the December 2008 vote to organize the plant under the United Food and Commercial Workers Union.

On the other hand, those who favor amnesty for illegal immigrants can note that Smithfield management long threatened selective immigration enforcement in an effort to pressure illegal immigrant workers to vote against the union.

Smithfield’s ability to intimidate workers prior to the raids demonstrates the unsatisfactory nature of the current state of immigration enforcement. The federal government’s failure to implement a mandatory worksite verification program, coupled with spotty worksite monitoring by immigration authorities, creates an incentive to employ illegal workers and then use the threat of enforcement to intimidate them. Mandatory electronic verification of new hires, coupled with consistent and sustained follow-up by enforcement authorities would rectify this situation.

Continue reading "Did ICE enforcement lead to worker unionization at Smithfield?" »

July 15, 2009

Global remittances to decline by 7% - 10% this year

The World Bank is expecting that remittances back to developing countries will decline by 7% to 10% in 2009 compared to 2008, but will modestly grow in 2010. By 2010, the bank estimates remittances to be about $313 billion.

The Bank reported the size and relative value of remittances to receiving countries as follows:

Overall, the top recipients of migrant remittances among all developing countries last year, according to the report, were India ($52 billion); China ($40.6 billion); Mexico ($26.3 billion); the Philippines ($18.6 billion); Poland ($10.7 billion); Nigeria ($10 billion); Egypt ($9.6 billion); Romania ($9.4 billion); Bangladesh ($9.0 billion); and Vietnam ($7.2 billion).

The top recipients of migrant remittances as a percentage of GDP were Tajikistan (46 percent); Tonga (39 percent); Moldova (34 percent); Lesotho (28 percent); Guyana (26 percent); Lebanon (24 percent); Samoa (23 percent); Jordan (22 percent); Honduras (21 percent); and Kyrgyzstan (19 percent), according to the report.


The article in full:

Continue reading "Global remittances to decline by 7% - 10% this year" »

May 30, 2009

New York City trains illegal workers for better jobs

As part of a large redevelopment project in Queens that will close down some automotive junk yards, the City is training over a 100 illegal workers for new, and hopefully better, jobs.

The students are a microcosm of the Willets Point work force: 145 are men, 115 are illegal immigrants and most know little or no English. Ages vary, as do the workers’ education levels.

Excerpts from the article in the NY Times:

It takes a certain humility to head back to school at the age of 52 and learn as a child would, through picture books and basic words sketched on a blackboard.

But Gustavo Zerón, a Honduran immigrant who works nine hours a day at a junkyard, swallowed his pride and signed up for the classes, which the city is offering in an effort to give laborers of soon-to-disappear businesses in Willets Point skills to find new work.

'That’s the only opportunity I have to get out of this place,' Mr. Zerón explained in Spanish as he headed for the No. 7 train to travel the 12 stops to class one recent evening.

He is not the only worker who wants to escape Willets Point, a bedraggled industrial triangle that neighbors the Mets’ new ballpark in Queens. Inside auto shops with names like Stubborn Used Tires and Latin American Mechanic and Muffler, summers are so hot and winters so cold that fingers become deformed with time, making a worker’s hands look like claws. Underground, there are no water or waste pipes. Outside, the landscape of unpaved streets resembles a muddied quilt of rivers and lagoons.

Neglected for many years, Willets Point is now poised for transformation. A $3 billion, 10-year redevelopment plan approved late last year calls for razing all of the businesses — auto shops, scrap yards, an Indian food manufacturer and a few construction companies — and replacing them with a hotel, homes, a conference center and stores.

Continue reading "New York City trains illegal workers for better jobs" »

May 1, 2009

Indians living in the U.S.: 2 million

A Washington Post article reports that "Roughly 2 million nonresident Indians, or NRIs, as they are known [in India], live in the United States, according to the Ministry of Overseas Indian Affairs in New Delhi. Worldwide, NRIs send home more than $30 billion a year, making up about 3 percent of India's gross domestic product, the International Labor Organization estimates."

March 19, 2009

The economics of the Swift meatpacking plant raids of 2006

The Center for Immigration Studies issued today a thoughtful analysis of employment at the Swift plants after the 2006 raids. The study is: The 2006 Swift Raids: Assessing the Impact of Immigration Enforcement Actions at Six Facilities. I have posted on the Swift raids in the past. The CIS study, authored by Pulitzer Prize winning journalist Jerry Kammer, goes into depth about the multi-decade meat-packing business trends which ended with Swift having, by his estimate, 23% of its production workers being illegal immigrants. And he writes about the aftermath of the raids on employment, wages and community.

Here is a paragraph from the study:

“One of the most important findings of this analysis is that these six Swift plants could operate without the presence of illegal workers. New employment screening adopted by the company, the raids themselves, and continuing efforts by Swift to employ legal workers, dramatically reduced the illegal share of workers at all of these facilities. Yet, all the facilities continued to operate and all returned to full production within a few months. Moreover, this recovery was accomplished during the first half of 2007 when national unemployment figures were still low and the current recession had not begun.”

A summary:

The 2006 Swift Raids: Assessing the Impact of Immigration Enforcement Actions at Six Facilities By Jerry Kammer March 2009

On December 12, 2006, about 1,300 illegal immigrants working at six meat processing plants owned by Swift & Co. were arrested in the largest immigration enforcement action in U.S. history. Other illegal workers, fearful of future raids, stopped reporting to work. Additionally, in the months prior to the raids, new employee screening by Swift led to the loss of about 400 illegal workers. The plants are located in Iowa, Minnesota, Nebraska, Texas, Colorado, and Utah. This report examines the raids and their aftermath.

Among the report’s findings:

* As is the case in the entire industry, work at the six Swift plants is characterized by difficult and dangerous conditions.
* Like the rest of the industry, workers at these facilities have seen a steady decline in their standard of living. Government data show that the average wages of meatpackers in 2007 were 45 percent lower than in 1980, adjusted for inflation.
* We estimate that 23 percent of Swift’s production workers were illegal immigrants.
* All facilities resumed production on the same day as the raids. All returned to full production within five months. This is an indication that the plants could operate at full capacity without the presence of illegal workers.
* There is good evidence that after the raids the number of native-born workers increased significantly. But Swift would not provide information on how its workforce has changed. Swift also has recruited a large number of refugees who are legal immigrants.
* At the four facilities for which we were able to obtain information, wages and bonuses rose on average 8 percent with the departure of illegal immigrants.

Continue reading "The economics of the Swift meatpacking plant raids of 2006" »

March 17, 2009

Remittances to Latin America to decline this year.

Remittances to Latin America and the Caribbean from the world (mostly from the U.S.) rose by 1% in 2008 to $69.2 billion but are forecast to decline by as much as 13% this year. This is according to a study by the Inter-American Bank, reported on by the Wall Street Journal. This will be the first drop in remittances perhaps for decades.

The article:

By MIRIAM JORDAN

Remittances sent from overseas workers back to Latin America and the Caribbean are expected to drop in 2009, according to a new study, shrinking what is often a crucial source of cash for many families in the region.

After a decade of growth, remittances to Latin America and the Caribbean began to slow in 2008, according to the Inter-American Bank, as countries that attract large numbers of migrant workers, including the U.S., Spain and Japan, slid into recession. And this year, remittances to the region are likely to drop for the first time since the bank began tracking annual flows in 2000.

Migrant workers -- the lifeline for millions of families in Latin America and the Caribbean -- sent home a record $69.2 billion last year, nearly 1% more than in 2007. However, the outlook is grim for 2009, according to the IDB. For countries that have reported data for January, totals were down by as much as 13%, according to remittance analysts at the Washington-based institution.

Continue reading "Remittances to Latin America to decline this year." »

February 12, 2009

Federal tax payments by illegal workers

Amelia’s Translation and Tax Services in Greeley CO was raided by local law enforcement people in search of illegal workers. They expected, correctly, that many of them dutifully files tax returns using fake social security numbers. (The dollar value of unallocable payments due to wrong social security numbers has been said to be $8 billion a year.)

Texas, Oregon and Iowa studies, compiled by the Immigration Policy Center, have estimated the amount of tax paying by illegal workers, and compared those amounts to the estimated costs of delivering public benefits to them and their households. I have previously posted on a study for New Jersey, and on the Texas study cited below.

from the The Immigration Policy Center

As the debate over illegal immigration continues to rage, some pundits and policymakers are claiming that unauthorized immigrants do not pay taxes and rely heavily on government benefits. Neither of these claims is borne out by the facts. Undocumented men have work force participation rates that are higher than other workers, and all undocumented immigrants are ineligible for most government services, but pay taxes as workers, consumers, and residents. (November 2007)

A 2006 study by the Texas State Comptroller found that “the absence of the estimated 1.4 million undocumented immigrants in Texas in fiscal 2005 would have been a loss to our gross state product of $17.7 billion. Undocumented immigrants produced $1.58 billion in state revenues, which exceeded the $1.16 billion in state services they received.”

Similarly, a 2007 study by the Oregon Center for Public Policy estimated that undocumented immigrants in Oregon pay state income, excise, and property taxes, as well as federal Social Security and Medicare taxes, which “total about $134 million to $187 million annually.”

In addition, “taxes paid by Oregon employers on behalf of undocumented workers total about $97 million to $136 million annually.” As the report goes on to note, undocumented workers are ineligible for the Oregon Health Plan, food stamps, and temporary cash assistance.

Likewise, a 2007 report from the Iowa Policy Project concluded that “undocumented immigrants pay an estimated aggregate amount of $40 million to $62 million in state taxes each year.” Moreover, “undocumented immigrants working on the books in Iowa and their employers also contribute annually an estimated $50 million to $77.8 million in federal Social Security and Medicare taxes from which they will never benefit. Rather than draining state resources, undocumented immigrants are in some cases subsidizing services that only documented residents can access.”

Unemployment Rises Sharply Among Latino Immigrants in 2008


The Pew Hispanic Center compared employment data for the last quarter of 2007 and 2008 and did not like what it found. Here is its summary:

The current recession is having an especially severe impact on employment prospects for immigrant Hispanics, according to an analysis of the latest Census Bureau data by the Pew Hispanic Center, a project of the Pew Research Center. The unemployment rate for foreign-born Hispanics increased from 5.1% to 8.0%, or by 2.9 percentage points, from the fourth quarter of 2007 to the fourth quarter of 2008. During this same time period, the unemployment rate for all persons in the labor market increased from 4.6% to 6.6%, or by 2.0 percentage points.

Among immigrant Latinos, the share of the working-age population (16 and older) that is employed fell by 2.8 percentage points, from 67.5% in the fourth quarter of 2007 to 64.7% in the fourth quarter of 2008.1 Among all persons of working age, the employment rate decreased by 1.6 percentage points, from 63.2% to 61.6%, in the first year of the recession.

The recession has also had a strong negative effect on blacks and native-born Hispanics in the labor market. Blacks are currently the only major racial and ethnic group whose unemployment rate is in double digits, 11.5% in the fourth quarter of 2008. Native-born Hispanics had the second highest rate of unemployment (9.5%) in the fourth quarter of 2008. However, changes in the employment rate and other indicators of labor market activity during the recession have been less severe for them than for foreign-born Hispanics.

January 23, 2009

Immigrant labor in the economic crisis

The Migration Policy Institute this month (January 2009) issued a study of immigrants and the U.S. economic crisis: how will immigrants fare? This study attempts to answer that question. In the executive summery, the authors opine that:

1. immigrant population growth has slowed, in large measure to no growth in the illegal population since 2006
2. There may be more Mexicans returning to their home country, but the evidence os only anecdotal.
3. Return migration flows appear to track more closely with the employment trends in the country of origin rather than in the host country. Example: Polish workers left Ireland due primarily to better work opportunities in Poland.
4. Legal immigration (roughly one million a year) is weakly tied to economic conditions because most of this flow is based on family ties, with applications often going back for years.
5. Most immigrant labor is vulnerable to employment downturns in the U.S. due to relative youth, low education status, and short tenure as workers.
6. “Deeply felt family obligations” such as commitments to remit earnings back home and lack or partial lack of access to the American safety net may cause many immigrants to do everything needed to keep their jobs.

January 8, 2009

Pew Hispanic Center: Latinos under economic stress

The Pew Hispanic Center summarized the results of a survey of how Latinos are experiencing the downturn. Latino economic concerns are greater than for the general population, and concerns among foreign-born Latinos are the worst.

The summary:

Like the U.S. population as a whole, Latinos are feeling the sting of the economic downturn. Almost one-in-ten (9%) Latino homeowners say they missed a mortgage payment or were unable to make a full payment and 3% say they received a foreclosure notice in the past year, according to a new national survey of 1,540 Latino adults conducted by the Pew Hispanic Center, a project of the Pew Research Center. Moreover, more than six-in-ten (62%) Latino homeowners say there have been foreclosures in their neighborhood over the past year, and 36% say they are worried that their own home may go into foreclosure. This figure rises to 53% among foreign-born Latino homeowners.

The survey also finds that the economic downturn has had an impact on the amount of money that Latinos sent to relatives or others in their country of origin in the past year. Among Hispanic immigrants who sent remittances in the last two years, more than seven-in-ten (71%) say they sent less in 2008 than in the prior year.

Latinos hold a more negative view of their own current personal financial situation than does the general U.S. population. More than three-in-four (76%) Latinos, and 84% of foreign-born Latinos, say their current personal finances are in either fair or poor shape, while 63% of the general U.S. population says the same.

As a result of current economic conditions, many Latinos are adjusting their economic behaviors. More than seven-in-ten (71%) report that they cut back spending on eating out. More than two-thirds (67%) planned to curtail holiday spending. Over one-fourth (28%) report that they helped a family member or friend with a loan.

January 5, 2009

remittances to Mexico fell sharply towards end of 2008

Reuters reports that remittances to Mexico declined by 2.6& November year to date from the prior year, and in November sank by 10.7% from the prior November. This reflects of course the weak American economy. Mexico itself is experiencing a recessionary downturn.

The article:


Mexico migrant remittances fall in Nov

Reuters, January 2, 2009

Mexico City (Reuters) -- Mexicans living abroad sent less money home in November compared with the same month a year ago, the central bank said on Friday.

Remittances, one of Mexico's biggest sources of foreign currency, fell 10.68 percent in November to $1.607 billion, the bank said.

Migrant cash flows, which are a lifeline for millions of poor Mexican families, are expected to weaken more in the coming months as the U.S. economic slowdown hits Mexican workers living there.

A weakening in the U.S. construction and manufacturing sectors is weighing particularly heavily on migrants, whose jobless rate jumped higher than that of the general U.S. population during 2008.

Annual accumulated remittances by November 2008 were $21.577 billion, down 2.63 percent from the same period in 2007,

The drop in money sent back home is seen squeezing the slowing Mexican economy as migrants' families spend less.

A drop in domestic demand this year is expected to add to pressure from falling exports due to the recession in the United States, Mexico's top trading partner.

Mexico's economy will likely shrink by 0.1 percent this year, according to the most recent monthly poll by the central bank, following a projected 2 percent growth rate for 2008.

October 3, 2008

Remittances from the United States declining

The Inter-American Development Bank has reported that in real dollar terms, the level of remittances to Latin American countries, which run on average about $300 a month, has declined for the first time since the funds flow was analyzed in 2000. The Bank is estimating the funds flow in 2008 will be 1.7% below 2007 levels when adjusted for inflation.

But the bank also confirms the importance of these remittances. “Notwithstanding this slowdown, the volume of remittances to Latin America and the Caribbean still outstrips all the overseas development aid and foreign direct investment in this region. Remittances are and will continue to be a vital lifeline for millions of households.”

The press release from the Bank:

Economic downturns, inflation hit remittances to Latin America


IDB fund forecasts money transfers made by migrants will decrease in real terms

For the first time this decade, remittances to Latin America and the Caribbean are expected to decrease in value due to the combined effects of economic downturns in the United States and Spain, inflation and a weaker dollar.

According to an analysis of recent remittance data by the Inter-American Development Bank’s Multilateral Investment Fund (MIF), migrants from Latin America and the Caribbean will send some $67.5 billion to their homelands in 2008, against $66.5 billion in 2007.

However, adjusted for inflation, this year’s total will be worth 1.7% less than the total sent in 2007, marking the first decrease in the value of remittances to Latin America and the Caribbean since the MIF started tracking these flows in the year 2000. Until last year, remittances to the region had grown by double digits every year

Continue reading "Remittances from the United States declining" »

October 2, 2008

Sharp decline in median income of non-citizen immigrant households

The Pew Hispanic Center reports that the median income of households headed by non-citizen immigrants fell 7.3% between 2006 and 2007. 45% of these households are headed by an illegal immigrant. Given has about half of these illegal workers are estimated ot be pain in full or part in cash. I am not very confident about these figures. However, the collapse of the residential construction market has probably wiped out a lot of relatively high paying jobs, and demand for illegal labor has probably peaked or declined in all other job sectors.

The press release:

WASHINGTON - The median annual income of non-citizen immigrant households fell 7.3% from 2006 to 2007. In contrast, the median annual income of all U.S. households increased 1.3% during the same period. A Pew Hispanic Center report released today analyzes recent trends in the incomes of the nation's 8.2 million non-citizen immigrant households and identifies who among them experienced the largest losses. About half (45%) of non-citizen immigrant households are headed by an undocumented immigrant.

The decline in the economic fortunes of non-citizen households represents a sharp turnaround from the preceding year. Incomes of non-citizen households in 2006 were 4.1% higher than income levels in 2005. Incomes of all U.S. households, meanwhile, had increased 0.7%.

Overall, the income of non-citizen households has displayed great instability in the past decade, fluctuating much more than the average for all U.S. households. For example, household income for non-citizens increased 9.8% in 2000, the last year of an historic expansion, and fell 4.2% in 2001, the first year of a recession and economic slowdown.

The Center's estimates show that household incomes have fallen most for non-citizens who are Hispanic; from Mexico, other Latin American countries and the Caribbean; recently arrived; males, either unmarried or with no spouse present; lacking a high school education; and employed in construction, production or service occupations. Those characteristics of non-citizen households experiencing declines in income that are higher than average are also associated with likely undocumented status for the head of household.

July 16, 2008

Hispanic employment figures worsen

The Pew Hispanic Center recently put out a report on the Hispanic labor force. It says that the Hispanic unemployment rate has moved sharply upwards. “Due mainly to a slump in the construction industry, the unemployment rate for Hispanics in the U.S. rose to 6.5% in the first quarter of 2008, well above the 4.7% rate for all non-Hispanics. As recently as the end of 2006, the gap between those two rates had shrunk to an historic low of 0.5 percentage points--4.9% for Latinos compared with 4.4% for non-Latinos, on a seasonally adjusted basis.”

It goes on to report…..

The spike in Hispanic unemployment has hit immigrants especially hard. Their unemployment rate was 7.5% in the first quarter of this year,2 marking the first time since 2003 that a higher percentage of foreign-born Latinos was unemployed than native-born Latinos. Some 52.5% of working age Latinos (ages 16 and older) are immigrants. Latinos make up 14.2% of the U.S. labor force.

Despite the disproportionate impact that the economic slowdown has had on immigrant Latino workers, there are no signs that they are leaving the U.S. labor market. Their labor force participation rate--that is, the percentage of the immigrant working-age Latino population either employed or actively seeking employment--has remained steady. However, they now play a smaller role in the growth of the Hispanic workforce than in recent years.

The latest trends in the labor market represent a dramatic reversal for Latino workers. Hispanics lost nearly 250,000 jobs over the past year because of the recent slump in the construction sector. For several years, construction was the mainstay of job growth for Hispanic workers, especially those who are immigrants. Even as home building stumbled in 2006, Hispanics found nearly 300,000 new jobs in the construction industry from the first quarter of 2006 to the first quarter of 2007. The ongoing slump in construction over the past year has wiped out those gains, virtually in their entirety.

Mexican immigrants have suffered the effects of the construction downturn most keenly. Latino workers who exited construction in 2007 included about 221,000 immigrants. Some 152,000 of those workers had migrated from Mexico. Latino immigrants who entered the U.S. in 2000 or later (from any country) lost 69,000 jobs in construction. For each of these groups of immigrants the jobs lost in construction accounted for the majority of losses from the first quarters of 2007 to the first quarter of 2008.

Labor market outcomes for Hispanic women appear to be worse than for men during 2007. They left the labor force in greater proportion and experienced greater increases in unemployment than did Hispanic men. Some 130,000 more Latino women became unemployed in 2007, and their unemployment rate increased from 5.6% to 7.0%.

June 12, 2008

Two cases of immigrant labor abuses

The Washington Post has been reporting on the plight of 200 Indian workers who paid recruiters a load of money to be sent to the United States to work – and, per what they were told, be in line for green cards. That proved not to be the case: they were given H-2B 10- month visas to rebuild oil rigs for Signal International. The second case involves a building collapse in New York City causing the death of a worker, Lauro Ortega – who happened to be an illegal immigrant. Workers Comp Insider, one of the best sources of information about work injury issues, has been reporting on the Ortega case, which involves negligence and a heinous attitude by the contractor.

June 5, 2008

Immigrant Hispanic unemployment rate: 7.5%

The Pew Hispanic Center reports that in the first quarter of this year, the unemployment rate for immigrant Hispanics was 7.5%, compared to all Hispanics at 6.5% and 4.7% for all non-Hispanics. About half – 52.5% -- of all working age Latinos (ages 16 and older) are immigrants.

In recent years the immigrant Hispanic unemployment rate was law compared to all non-immigrant rates, as reported by the Bureau of Labor Statistics for 2006 - 2007. And, not reported in these figures, the labor force participation rate of illegal Hispanic immigrant males was extremely high. (This Pew report does not break out illegal immigrants.)

Much of the unemployment rate increased is attributed to the housing slump. “Mexican immigrants have suffered the effects of the construction downturn most keenly. Latino workers who exited construction in 2007 included about 221,000 immigrants. Some 152,000 of those workers had migrated from Mexico.”

“Labor market outcomes for Hispanic women appear to be worse than for men during 2007. They left the labor force in greater proportion and experienced greater increases in unemployment than did Hispanic men. Some 130,000 more Latino women became unemployed in 2007, and their unemployment rate increased from 5.6% to 7.0%.

“Weekly earnings for most groups of Hispanic workers also slipped backward in the past year. Again, Latino construction workers suffered most from the decline in wages. Their earnings tumbled in 2007 and they now earn less than they did two years ago in the first quarter of 2006.”

The report in full:

Latino Labor Report, 2008: Construction Reverses Job Growth for Latinos

Continue reading "Immigrant Hispanic unemployment rate: 7.5%" »

May 4, 2008

Remittances to Latin America are flat or down

From 2001 to 2006, remittances from the U.S. to Latin America boomed from $15 billion to $45 billion, according to the Inter-American Development Bank. Since then they have barely grown. Why? According to a survey of 5,000 Latin American immigrants reported in the New York Times, “Latino immigrants said life had become more difficult for them here. Of those interviewed, 81 percent said it is harder to find a good-paying job. Almost 40 percent said they were earning less this year than the previous year. The largest group of immigrants in the survey — 18 percent — worked in construction, which has been especially hard hit in the slowdown.

As a result of the difficulties, among immigrants who had been here less than five years, 49 percent said they were thinking of returning home, while 41 percent said they planned to remain in the United States. Over all, slightly under one-third of the immigrants said they were thinking of leaving this country.

In an interview in Phoenix on Wednesday, Yolanda, a 45-year-old illegal immigrant from Mexico who did not participate in the survey, said that she had started to think of going home, after 13 years in the United States. Before November, she was sending at least $400 a month to Mexico City to support her three children. This year she can manage only $300 every two months, she said.”


The article in full:

Continue reading "Remittances to Latin America are flat or down" »

April 9, 2008

Sent back to El Salvador with its 50% unemployment rate

This is the second part of NPR’s Morning Edition’s report on the effect of the illegal immigrant crackdown in the U.S. This second of two reports, produced on April 8, recounts the forced return to El Salvador of Omar Giron, who lived in the U.S. for twenty years had left his four children – American citizens – in Virginia. “The upheaval began a year ago with a parking ticket. When Giron went to pay it, a string of convictions for driving under the influence and a domestic violence conviction finally caught up with him. He spent 10 months in jail before being deported to El Salvador.” “Giron interviewed for a job at a call center [in El Salvador], figuring his English would be a big plus. He was told he needed to know more about computers, so he's still looking. But in a country where the United Nations estimates that half the population is either unemployed or underemployed, landing any job is no sure thing.”

The report in full:

When Omar Giron returned to El Salvador — the country he left 20 years ago — it hardly felt like a homecoming. Having lived in the United States for so long, he considers himself American.

Giron and his family fled El Salvador's civil war when he was a teenager. They received protected legal status from U.S. officials. But after repeated run-ins with the law, Giron was stripped of his legal standing and deported last December.

Continue reading "Sent back to El Salvador with its 50% unemployment rate" »

NPR: Jobs for day laborers decline due to housing slump, economy

On April 4 NPR’s All Things Considered ran an interview with Pablo Alvarado. executive director of the National Day Laborer Organizing Network, about the effect of the declining economy on demand for day laborers. Alvarado said, ‘, the number of workers in street corners and day labor centers has increased while the number of jobs has decreased. And that has do with the decline in the housing market because the majority of the employers of day laborers are homeowners, and usually, they use some kind of disposable income to hire workers to come and clean their backyards and front yards, do mostly landscaping and small home remodeling projects.”

But he says that illegal immigrants are staying. “Let me put it this way, if you live in Mexico or Central America, you may have your house and you may not have a bed, and you don’t have any bed to sleep, you have to sleep on the floor. But when you come to this country, you may not have a bed either, but at least there’s a carpet where you can lay down and sleep. And just by that, you see the improvement in the quality of life, just that simple example.”

The transcript in full:

Job Opportunities for Day Laborers Decline

April 4, 2008 from All Things Considered

ROBERT SIEGEL, host: What about employment at the lowest levels of the economy? What about those hiring lines of day laborers looking for a few hours of construction work or painting or gardening.

A lot of the people doing that kind of labor are working in the country illegally, and in some jurisdictions they’re facing new policies cracking down on illegal immigration.

What’s the impact of the economic down turn on them?

Pablo Alvarado is executive director of the National Day Laborer Organizing Network. He joins us from Los Angeles.

Welcome to the program, Mr. Alvarado.

Mr. PABLO ALVARADO (Executive Director, National Day Laborer Organizing Network): Thank you for having me.

SIEGEL: And first, from what you’ve been able to find out what’s happening on hiring lines at day labor centers?

Mr. ALVARADO: Well, the number of workers in street corners and day labor centers has increased while the number of jobs has decreased. And that has do with the decline in the housing market because the majority of the employers of day laborers are homeowners, and usually, they use some kind of disposable income to hire workers to come and clean their backyards and front yards, do mostly landscaping and small home remodeling projects.

Continue reading "NPR: Jobs for day laborers decline due to housing slump, economy" »

January 31, 2008

Philippines and the planned export of labor

Possibly no nation has been as deliberate in educating and facilitating the temporary travel of its workforce overseas as has the Philippines. According to this article in the Vancouver Sun, it has 24 overseas labor offices to oversee labor protections of its workers. This article deals with an agreement between British Columbia and the Philippines; three other Canadian provinces already have signed agreements. For B.C, the Philippines is already the third largest source of immigrants.

According to the article, a “joint labour committee with members from both sides….will hammer out specific guidelines for training, certification and assessment of both employees in the Philippines and employers in B.C.”

The article in full:

Continue reading "Philippines and the planned export of labor" »

December 14, 2007

Arizona crackdown on illegal workers may hit state economy

“Arizona Squeeze On Immigration Angers Business” is the title of a Wall Street Journal article published today. The article tracks the impact of legislation and law enforcement measures against illegal immigrants. The effect of removing illegal workers may have a hugely negative impact on the Arizona economy.

As the article says, “About 500,000 undocumented immigrants live in Arizona, according to the Pew Hispanic Center, and independent estimates suggest about 350,000 of them are working. Immigrants, both legal and illegal, account for 14% of the work force. The state enjoys one of the fastest-growing economies in the nation, and its unemployment rate last year was just 3.3%.

A University of Arizona study released earlier this year concluded that economic output would drop 8.2% annually if noncitizen foreign-born workers were removed from the labor force. Researchers estimate about two-thirds of the workers in that category are in the state illegally.”

The entire article:

Continue reading "Arizona crackdown on illegal workers may hit state economy" »

December 7, 2007

After the meatpacking raids: one year later

ICE made big raids on Swift meatpacking plants in December 2006. I have posted on it several times. Jennifer Ludden of National Public Radio reported on how one Cargill plant, hurting for workers, is recruiting in Puerto Rico for jobs in Illinois. From this report, it appears that replacing illegal workers has not been easy.

Morning Edition, December 6, 2007 · A year ago, immigration agents arrested more than 1,200 illegal workers at Swift meat-packing plants in six states.

The arrests set off a debate about whether immigrants take the grueling jobs away from Americans. Republican presidential candidate U.S. Rep. Duncan Hunter said last summer that the day after the raids, Americans were lined up to get their $18-an-hour jobs back.

In reality, the meat-packing plants pay an average hourly rate of $11 or $12 — and no one is lining up to work there.

Many plants, even those that were not raided, must still recruit heavily for legal workers.

In July, a Cargill plant in Beardstown, Ill., began running advertisements in Puerto Rico's capital city, San Juan.

Officials then flew over to conduct interviews there and in four other towns.

Continue reading "After the meatpacking raids: one year later" »

November 20, 2007

$300 billion a year in worker remittances back home.

For 38 countries remittances accounted for more than 10 percent of the gross domestic product. Only about a third of the money, $96 billion, comes from the United States, with large sums also originating in Europe and the Middle East. These and other observations from an article in the New York Times.

The article in full:


THE money flows in dribs and drabs, crossing borders $200 or $300 at a time. It buys cornmeal and rice and plaid private school skirts and keeps the landlord at bay. Globally, the tally is huge: migrants from poor countries send home about $300 billion a year. That is more than three times the global total in foreign aid, making “remittances” the main source of outside money flowing to the developing world.

Surveys show that 80 percent of the money or more is immediately spent, on food, clothing, housing, education or the occasional beer party or television set. Still, there are tens of billions available for savings or investment, in places where capital is scarce. While remittances have been shown to reduce household poverty, policymakers are looking to increase the effect on economic growth.

Some migrants, for instance, send home money to savings accounts at small bank-like microfinance institutions, which use the resulting capital pool to lend to local entrepreneurs.

People who track remittances have been starved for basic data. It is difficult to say exactly how much money is flowing and even harder to say where to, exactly. Sums large and small travel informally, through the mail or in the care of friends. The World Bank, the main tally keeper (in the form of a careful economist named Dilip Ratha), only counts transfers recorded by central banks. Last year’s sum came to $208 billion. Bank officials estimate that the global total is about 50 percent higher — $300 billion or more.

Last month, the International Fund for Agricultural Development, an arm of the United Nations, and the Inter-American Development Bank released a set of numbers culled from additional sources, including private survey data and records of money-transfer companies. (The research was led by Manuel Orozco of the Inter-American Dialogue, a Washington research group.)

The new study’s estimate of the global total, $301 billion, is about the same as the World Bank’s. But when it comes to specific countries, the two organizations vary widely.

The World Bank, capturing central bank data, said southern African countries received about $1.4 billion in 2006. The new study said $4.5 billion. The World Bank puts Brazil’s intake at $3.5 billion; the new study reports $7.4 billion. Depending which numbers you use, Russia received either $3.3 billion (old) or $13.8 billion (new). The World Bank data has been published annually, while the new study, part of a larger project, has not been widely reviewed.

By any accounting, the amounts involved are big and flow worldwide: migration truly is global. The new study found that 60 countries received $1 billion a year or more last year. In 38 countries, remittances accounted for more than 10 percent of the gross domestic product. Mr. Orozco estimates that only about a third of the money, $96 billion, comes from the United States, with large sums also originating in Europe and the Middle East.

Donald F. Terry, an official at the Inter American Development Bank, which helped sponsor the study, has campaigned for years to publicize the importance of remittances. His policy agenda includes reducing the costs of sending money and helping migrants open bank accounts, especially back home, so they can gain access to mortgages and business loans.

“Putting it out there this way increases the level of policy interest,” Mr. Terry said. “What’s stunning is how critical remittances are in almost every developing country in the world.

November 6, 2007

Analysis of farm labor economics in California

Philip Martin of UC Davis prepared a fresh analysis of labor economics in California’s produce growing industry. He challenges the assertion that there is a labor shortage, which assertion in behind the move to get AgJobs passed by Congress. I have cited Martin’s work in the past. Below is a summary of his new study from the Center for Immigration Studies, which is opposed to granting rights to illegal immigrants.

The study is called Farm Labor Shortages: How Real? What Response?

# Production of fruits and vegetables have been increasing. In particular, plantings of very-labor-intensive crops such as cherries and strawberries have grown by more than 20 percent in just five years.

# The average farm worker makes $9.06 an hour, compared to $16.75 for non-farm production workers.

# Real wages for farm workers increased one-half of one percent (.5%) a year on average between 2000 and 2006. If there were a shortage, wages would be rising much more rapidly.

# Farm worker earnings have risen slower in California and Florida (the states with the most fruit and vegetable production) than in the United States as a whole.

# The average household spends only about $1 a day on fresh fruits and vegetables.

# Labor costs comprise only 6 percent of the price consumers pay for fresh produce. Thus, if farm wages were allowed to rise 40 percent, and if all the costs were passed on to consumers, the cost to the average household would be only about $8 a year.

# Mechanization could offset labor higher labor costs. After the “Bracero” Mexican guestworker program ended in the mid-1960s, farm worker wages rose 40 percent, but consumer prices rose relatively little because the mechanization of some crops dramatically increased productivity.

# Labor-saving mechanization can be difficult for one farmer, since packers and processors are usually set up to deal either with hand-picked or machine-picked crops, but not both. Government has a key role to play in facilitating mechanization.

September 16, 2007

2006 Remittances to Mexico flat – housing downturn in U.S.?

According to the Migration Policy Institute, remittances to the U.S. were flat in 2006 compared to rapid growth in prior years. The report estimates that remittances were $24.5 billion. The report, like other I posted before, does not break out funds from the U.S., which must be the large majority. The housing turndown in the U.S., which began in 2006, may be the cause of the flat results.

The full report by MPI, available on the website, pinpoints the destination of funds by Mexican state. In a few states, over 10% of the state’s domestic product is remittance money.

The press release:

In “A First Look at the 2007 Slowdown in Remittances”, MPI reported that In 2006, Mexico received an estimated $24.5 billion in remittances -- 11.3 percent of the total $276 billion in remittances worldwide. While migrant remittances to Mexico grew an average of 19.1 percent annually between 2003 and 2006, however, they increased by just 0.6 percent in the first half of 2007 compared to the first half of 2006.

A new MPI fact sheet provides a first look at changes in remittances to Mexico by state for 2003 to 2007, highlighting the states that may be most severely affected by a slowdown in money coming in from migrants abroad in the first six months, or semester, of 2007. The fact sheet, based on Bank of Mexico figures, shows

* Five Mexican states registered more than 5 percent growth in remittances in the first semester of 2007 compared to the first semester of 2006. They are Yucatan (17.8 percent), Guanajuato (12.1 percent), Puebla (9 percent), Baja California (7.9 percent), and Baja California del Sur (7.4 percent). In no case did the growth exceed the growth from January to June of 2006.
* Remittances fell by more than 5 percent in the first semester of 2007 in five states compared to the same period in 2006. They are the Distrito Federal (9.4 percent), Michoacán (6.8 percent), Chiapas (6.0 percent), the State of México (5.6 percent), and Chihuahua (5.2 percent).
* Of the remaining states, 17 had growth of less than 5 percent in remittances in the first semester of 2007 compared to the first semester of 2006 and five states had a decline of less than 5 percent.
* Four states accounted for more than a third of remittances in 2006 and 2007. The states of Michoacán, Guanajuato, Jalisco, and México accounted for more than a third of remittances to Mexico in 2006 and received 36.6 percent of remittances in the first half of 2007. The states receiving the smallest amounts in the first semester of 2006 and the first semester of 2007 included Baja California del Sur, Campeche, Quintana Roo, and Yucatán.
* Some states appear more dependent on remittances than others, the level of which can be seen by comparing a state’s share of remittances to its gross domestic product. Data show that the states of Michoacán, Guerrero, Zacatecas, Oaxaca, Nayarit, and Hidalgo displayed the highest levels of dependency in 2004, the latest year for which state-level GDP data are available. Baja California del Sur, Campeche and Quintana Roo appeared to be the least dependent on remittances due to comparatively low remittance inflows. Distrito Federal, Chihuahua and Nuevo León were less dependent due to comparatively high GDPs.

“While it is still unclear why remittance growth stalled in the first half of this year, if the slowdown continues through the remainder of 2007, it could have real implications for many Mexicans,” said Aaron Matteo Terrazas, an MPI researcher and author of the fact sheet. He continued, “We do know that money migrants send home is a lifeline for many communities, and local policymakers will need to evaluate what a slowdown in remittances might mean for their cities and states.”


September 11, 2007

Tomato farms in Florida – what they say they are doing for workers


Go to the Florida Tomato Growers Exchange website for its view of working conditions and labor relations.

It identifies itself thusly:

"The Florida Tomato Growers Exchange is an agricultural cooperative of Florida tomato growers who operate as socially accountable farm employers by participating in comprehensive programs that certify employment, health, housing and safety practices. The industry is strongly committed to supporting long-term solutions that improve the lives of their employees."

I have no solid means of verifying their statements but am not inclined to challenge them. I know one of the employers and know him to be a good guy. The Exchange says that its member participate in SAFE – Socially Accountable Farm Employers program, which I have posted on here. SAFE is a model for employer support of labor protections for immigrant agricultural labor.

May 30, 2007

Hispanic labor share continues to grow, now 25% of construction

The number of Hispanic workers in increased in 2006 over 2005, just as it had in prior years. And the growth is particularly noticeable in construction. This is according to a Pew Hispanic Center report issued in March of this year but just come to my attention.

In 2006, there were about 145 million in the workforce. Of these 20 million were Hispanics, up from 18 million in 2004. Much of the growth came from relatively new arrivals (last 2 years) in the United States. In total, they comprised in 2006 13.6% of the industry’s workforce.

The “Latino” labor force added 980,000 workers between 2005 and 2006. “That accounted for 38% of all workers added to the labor force.”

They accounted for two thirds of the 599,000 person growth in construction employment in 2006. About 11.7 million people work in construction. In 2004, Hispanics made up 21% of this total. In 2006, they made up 25%. Of that, 19.1% were foreign born and 7.2% were recent arrivals in the U.S. (last two years). The recent arrival segment has been growing very rapidly.

March 23, 2007

Trafficking in identity papers - a case study

The NY Times ran an article which gets into the underbelly of the trafficking of personal identifications for use by illegal immigrants. The article links a worker who was caught up in the Swift raid in Marshalltown, IA in December with a drug addict in Bakersfield, CA. Reportedly, the drug addicted American woman has replaced her social security card twenty times, presumably to sell it.

“Ms. Eloisa Nuñez Galeana said she paid a woman $800 for official copies of Ms. Violeta Blanco's birth certificate and Social Security card.” How Blanco’s papers, by inference sold by her, got into the hands of Nunez is through a lot of hands and possibly multiple uses of them.

Here are excerpts from the article.

Continue reading "Trafficking in identity papers - a case study" »

March 9, 2007

Regional sources of Mexican workers in U.S.

The Atlantic Monthly (subscription required) has an article in its April 2007 edition called “The Mexican Connection.” I have posted on this before (search for “remittance”). The main contribution of this article is to pinpoint the regional sources of many of U.S. based workers -- states immediately northwest of Mexico City: “ Five predominantly rural Mexican states—Guanajuato, Jalisco, Michoacán, San Luis Potosí, and Zacatecas—send a disproportionately large number of emigrants to the United States. Their links to the U.S. date back a century, to when American mining and railroad companies recruited workers from these regions to offset reductions in Chinese and Japanese immigration. Home to less than a third of Mexico’s population, they receive 44 percent of Mexico’s remittances.”


The Mexican Connection
by Matthew Quirk

Among the crumbling adobe shacks of rural Mexico, two-story California- style housing developments are rising. In the tiny city of Tlacolula, plots of land that sold for about $10,000 in 1994 now cost $60,000. Like the towns where they are going up, the new developments are partly empty. The home owners are among the many Mexican workers—nearly one in seven overall, and half the adult population of some communities, such as La Purísima and San Juan Mixtepec—who are in the United States. Typically working low-wage jobs, they send home much of their pay (41 percent on average, or $300 a month) to support families left behind and build a better life for their return.

Remittances to Mexico exceed $20 billion a year.[Actually $25B – PFR] By 2003, they had become the nation’s second-largest source of external finance, ahead of tourism and foreign investment and just behind oil exports. That same year, then-President Vicente Fox noted that the roughly 20 million Mexican-origin workers in America create a larger gross product than Mexico itself. [This cannot be a correct figures – it is too large. There may be 20 million total Mexican-born people in the U.S. including children. – PFR]

Worldwide, remittances have surpassed direct aid in volume, and international development institutions (along with the governments of many less- developed countries) have recently seized upon them as a key to economic growth in the global South. The United States is the largest source of remittances—Saudi Arabia, with its armies of serflike guest workers, is No. 2—and Mexico the largest recipient of U.S. funds.

Continue reading "Regional sources of Mexican workers in U.S." »

March 8, 2007

Two of three new construction jobs go to Hispanics

The Pew Hispanic Center released a factsheet that examines recent trends in the employment of Latino workers in the U.S. labor market and focuses specifically on the construction industry.

Hispanic workers landed two out of every three new construction jobs in 2006, according to the analysis. They benefited from strong employment growth in the industry even as the housing market endured a year-long slump. Indeed, the construction industry continues to be a key source of jobs for Hispanics and especially for those who are foreign born and recently arrived.

Hispanic employment increased by almost 1 million from 2005 to 2006. Even though Latinos account for only 13.6% of total employment, they accounted for 36.7% of the increase in employment. The comparatively high share of employment reflects demographic changes in the U.S. About 40% of the total increase in the working-age population (16 and older) in 2006 was Hispanic and of these three-fourths are foreign born Latino workers.

Foreign-born Latinos who arrived since 2000 were responsible for about 24% of the total increase in employment in the U.S. labor market last year. Estimates by the Pew Hispanic Center suggest that in recent years about two-thirds of the increase in the employment of recently-arrived Hispanic workers has been due to unauthorized migration.

The estimates in the fact sheet are derived from data from the Bureau of Labor Statistics and the Census Bureau. Most of the data is from the Current Population Survey, a monthly Census Bureau survey of approximately 60,000 households. Monthly data are combined to create larger sample sizes and to conduct the analysis on either an annual or quarterly basis. The analysis is for 2004-2006.

February 23, 2007

AFL-CIO Building and Construction Trades Department’s statement on immigration reform.

Here is the statement, thanks to Jim Platner. I will summarize:

“Mass unregulated illegal immigration into the United States creates unfair wage competition.” There needs to be tougher border enforcement. “A mandatory electronic work-eligibility verification system is needed, which can effectively detect the use of fraudulent documents and significantly reduce the employment of unauthorized immigrants.” This system is “the lynchpin” to comprehensive immigration reform.

A new temporary worker program “would be particularly harmful to the long-term interests of the building and construction industry, because of its negative effect on bona fide apprenticeship and training programs.”

Union sponsored hiring halls and joint labor/management training programs work, and should be supported as the means to provide qualified labor to this industry.

The H-2B visa system in place should be used for foreign labor. This visa program “is currently available to full employers’ temporary needs resulting from either on-time, seasonal, peak load or intermittent labor shortages that do not last for more than one year…it is uniquely appropriate” to fill employer needs in building and construction that cannot otherwise be met be hiring halls.

The H-2B system should be modified to allow for joint labor-management programs to sponsor temporary employment of “trained skilled workers from abroad.” This will assure protection of labor standards of U.S. workers.

There should be a “path to earned legal status” for illegal immigrants here now, as many have been “law-abiding, tax-paying and hard working” participants in the economy. They should pay an appropriate penalty and get in line behind those legally in line from the start. [The term “citizenship” is not used.] Once they “adjust their status”, they should receive federal labor and civil rights protections but not receive federal entitlements.

February 19, 2007

Robert Feenstra on the powerful dynamics linking U.S. and Mexican workforces

Technology advances proceed apace while America is outsourcing jobs to developing countries. These two forces combine to increase the level of migration in the world. Much of this migration is into the U.S. by far the biggest in-migration country in the world. The net effect of this cycle is to improve middle class lives in the U.S. but worsen work prospects for poorly educated Americans.

Robert Feenstra of U.C. at Davis, who has long been a student of economic productivity, made a presentation on “Globalization and its Impact on Labor.” He goes a long way to describing the overwhelming power of forces behind the growth of low wage immigrant labor (including illegal labor) in the United States.

The essence of Feenstra’s story, leavened with information he does not include, is this:

Manufacturing labor in both the U.S. and Mexico have not benefited in the past 10-15 years even while the service workforce has benefited, by capturing the lion’s share of increases in the compensation pie.

This is in part because manufacturing growth in Mexico, expected due to NAFTA, failed to take place except in isolated areas like along the American border (Manquiladora). Thus good manufacturing jobs were not available at anywhere near the numbers needed for the ocuntry's work population. In part, a disproportionate share of economic gains went to service, not manufacturing jobs. The manufacturing sector was also hurt by American and Chinese competition.

Relatively disadvantaged workers in both countries have been making hard decisions on where or if to work. With economic distances expanding between workforce segments, making catch-up less probable, choices narrow down to if and where to migrate.

Mexicans, especially those at the lower end of that country’s education scale, have little prospects of rewards in Mexico and have come to the U.S. to, in effect, make middle class life more comfortable for Americans. Poorly educated American workers have been withdrawing at increasing rates from the workforce, either into part time work, idleness or disability pensions.

Here in the style of Powerpoint bullets, is the story:

One, technology is concentrating economic rewards in the service sector workforce and leaving production (i.e. manufacturing) stagnant. This is happening in developed as well as developing countries – The U.S. as well as Mexico. In the U.S. service workforce relative wages compared to manufacturing wages grew strongly since the mid 1980s.

Two, production jobs in the U.S. are being off-shored and an increasing number of service jobs as well. The next effect is the increase the average compensation of better educated services workers – in both the U.S. AND in the countries providing the off-shored labor.

Three, this offshoring has been responsible for about 1% of the 2.5% – 4% annual productivity growth in the U.S. economy. This is a big deal.

Fourth, in Mexico manufacturing worker wages have not grown appreciatively with NAFTA, which was supposed to set off an economic boom. Feenstra does not discuss farm workers in Mexico, but one gets the impression that both farm and manufacturing wages in Mexico have lagged.

Fifth, there has been a huge transborder shift of workers at the lower end of the wage and education scale.

Mexican labor has moved into the U.S. just as the most vulnerable American workers have been withdrawing from the American workforce. Not addressed by Feenstra, the labor force participation of poorly educated blacks is very low.

Some 70% of the American workforce with less than 8 years of education are foreign born, and 22% of the workforce with 8 to 11 year’ education.

And American workers are heading out the door. The SSDI (disabled worker insurance program) of the U.S. has been growing – very sharply in the past few years. Those exiting the labor market for federal disability pensions are largely manufacturing workers with limited education. In 1995, there were 1.1 million SSDI awards made. In 2004, there were 2.2 million made.

The European Union has sought from the beginning to stem migration from poorer new members by systmatically suppprting infrastructure and manaufacturing growth in the new members.

See Feenstra here.

Immigration’s impact on American wages by educational level of workforce

Here are important research data on the impact of how foreign born workers hurt some and help other Americans in wages. Note that these figures pertain only to wage impact. They do not address the lower costs of goods and services and greater corporate productivity which immigration and its companion free trade bring

POORLY EDUCATED WORKERS

Ten percent of U.S. born workers have less than a 12 years’ education. Foreign born workers make up 70% of all workers with less than 9th grade education, and 22% of workers with 8-11 years’ education. In these education categories, foreign born workers MARKEDLY DEPRESS wages by about 4%.

HIGH SCHOOL GRADS and "SOME COLLEGE" EDUCATED WORKERS

Eighty percent of U.S. born workers have between 12 and 16 years’ education. Foreign born workers make up 13% of the HS graduate workforce and 10% of the some college work force. (13% of all workers with HS degree, 10% with some college, and about 15% with college degree.)

For the HS graduate and some college workforces, foreign born workers SLIGHTLY INCREASE wages very slightly, by about 1% - 2%

COLLEGE AND MORE EDUCATED WORKERS

Ten percent of U.S. born workers have masters, professional or doctoral degrees. Foreign born workers make up 15%, 18% and 30% of these workforce categories, respectivelly. These foreign born workers MARGINALLY DEPRESS wages, by about 0.2%.

ILLEGAL IMMIGRANTS

About 4.9% of the American workforce is made up of illegal workers. Few of them have a HS degree or higher education. They GREATLY DEPRESS wages for all workers with less than a HS degree – by 8% -- and MARGINALLY INCREASE the wages of the more highly educated workforce – by about 1%.

The data come from Table 5 and Figure 8 of a 2/8/07 presentation by Robert Feenstra of U.C. at Davis. he draws from research by Gianmarco Ottaviano and Giovanni Peri, about whom I have posted.

Poorly educated immigrant workers hurt, help American workers: 2005 study

Let's call this the Home Depot Effect: poorly educated workers compete for jobs, and benefit better educated workers by lowering the cost of goods while stimulating middle class growth.

Following is the abstract of a paper written in 2005 by Gianmarco Ottaviano and Giovanne Peri for the Centre for Economic Policy Research Discussion Paper No. 5226, 2005, (alternative version National Bureau of Economic Research Working Paper No. 11672, 2005: "Rethinking the gains from immigration: theory and evidence from the U.S."

Recent influential empirical work has emphasized the negative impact immigrants have on the wages of US-born workers, arguing that immigration harms less educated American workers in particular and all US-born workers in general. Because US and foreign-born workers belong to different skill groups that are imperfectly substitutable, one needs to articulate a production function that aggregates different types of labor (and accounts for complementarity and substitution effects) in order to calculate the various effects of immigrant labor on US-born labor.

We introduce such a production function, making the crucial assumption that US and foreign-born workers with similar education and experience levels may nevertheless be imperfectly substitutable, and allowing for endogenous capital accumulation.

This function successfully accounts for the negative impact of the relative skill levels of immigrants on the relative wages of US workers. However, contrary to the findings of previous literature, overall immigration generates a large positive effect on the average wages of US-born workers. We show evidence of this positive effect by estimating the impact of immigration on both average wages and housing values across US metropolitan areas (1970-2000). We also reproduce this positive effect by simulating the behavior of average wages and housing prices in an open city-economy, with optimizing US-born agents who respond to an inflow of foreign-born workers of the size and composition comparable to the immigration of the 1990s.

February 14, 2007

How long do Mexican migrants work in the U.S.? 6 – 11 years

From the abstract of recent study by the Austin TX based research firm of Econone: In this paper we use data from the Mexican Migration Project (MMP) to estimate the number of years a Mexican born foreign worker could reasonably be expected to be employed or seeking employment in the U.S. labor market. We find, consistent with other studies of Mexican migrant workers, that the typical Mexican born worker who migrates to the U.S. to work does not spend their entire working life in the U.S. Our analysis shows the typical Mexican migrant can be expected to be active in the U.S. workforce between 6.1 and 11.1 years on average.

February 12, 2007

Contractor insurance fraud and why it matters

Thanks to Workers Comp Insider for alerting me to this Insurance Journal article about building contractors who cheat on their workers comp insurance. Why does this matter for immigrant workers? Because employers who cheat on insurance – buying too little, or none at all – are those mostly likely to hire vulnerable immigrant workers and cheat these workers on other labor rights. The news story said nothing about the composition of the workforce, but I bet a lot of the lower skilled work was being performed by immigrant workers. I call this combination of insurance fraud and employer abuses a toxic cocktail that can kill.

February 9, 2007

Tidbits from the first year of this blog

In passing into the second year of workingimmigrants.com, I have compiled some notable entries from the first year -- Peter Rousmaniere

Relative role of U.S. in transborder migration

Number of cities in world with at least one million foreign born residents: 20
Number of these cities in the United States: 8
Number of these cities in India or China: zero
Size of foreign born population in the world today: 200 million out of 6.5 billion (3%)
Size of foreign born population in U.S. Today: 35 million out of 300 million (12%)

Relative role of China in intraborder migration

Number of internal migrants from rural to urban areas in China: 150 million out of total population of 1.2 billion.

Off-shoring of work and the polarization of the American workforce

MIT professor David Autor argues that highly routine mental and manual jobs are being outsourced overseas or eliminated by automation, but that mental and manual jobs involving a level of irregularity in decision making and face to face servicing are growing. This concept explains why some manual jobs are expected to grow in the future along with the growth of high end mental jobs.

Impact of all immigrant workers on American workforce

Share of new jobs 2002 – 2012 to be filled by an immigrant: one out of eight

Size of illegal workforce

Illegal workers in U.S. as of early 2006: about 7.3 million

Illegal workers as % of total U.S. workforce: 4.9%

Illegal workers as % of total U.S. workforce in jobs requiring less than high school degree and without strict documentation requirements: 9/7%

Where do illegal workers work?

Per the Pew Hispanic Center:

Some 55-60% of these undocumented workers are in formal employment and are paying social security taxes

About 3 million of the 7.2 million illegal workers are in occupations in which undocumented workers account for at least 15% of total employment in that occupation. These include construction labor (25%), cooks (20%). Maids and housecleaners (22%), and grounds maintenance (25%). among roofers, 29% of the total workforce is estimated to be undocumented workers.

One half of undocumented working men here are single. But a phenomenal 94% of undocumented men work compared to 83% for native Americans.

Economic impact of illegal population in U.S.

A Texas study says that illegal household payments of consumer and property taxes (via rent or home ownership) exceeds by about 30% the taxpayer burden for education, healthcare, and incarceration.

Do illegal workers displace American workers?

Some say yes, others say no.

It appears that illegal worker compensation is about 30% below what it would be with 100% worker protections afforded to Americans. Go here for a case study.

Waves of Hispanic work immigration since 1980s

1980s: agricultural workers, mostly on farms
1990s: meat processing workers, mostly in rural; towns
2000s: urban work including residential construction: in cities and suburbs

Employment of Indians in the U.S.

They own 20,000 hotels, or 50% of all economy hotels in the U.S.
There are 40,000 Indian physicians in the U.S, or about 4% of all doctors

Role of foreign born entrepreneurs in the U.S.

They are involved in one quarter of all technology start-ups.

Is there a nursing shortage?

Yes.

Percentage of Philippine nurses working outside the Philippines

75%

Foreign nurses in the U.S.

300,000, or about 11% of all nurses.

Mexican population in U.S.

Percentage of Mexican workforce that is working in the U.S.

16%

Remittances from Mexicans in U.S. to Mexico

$25 billion in 2006

Total remittances from all parts of world to Latin America

$54 billion in 2005

Number of community-based immigrant worker centers

upwards of 200

Foreign day laborers in the U.S.

Estimated number on any particular day:

117,600 at 500 sites in the U.S.

Percentage who speak English very well:

3%

Another follow up on the Swift raid: what happened to Cactus, TX.

The Washington Post reported that “The streets of this small, isolated city in the Texas Panhandle are virtually empty nowadays, and "For Rent" signs decorate dilapidated trailers and shabby 1940s-era military barracks that just weeks ago were full of tenants.” The story relates how the depletion of residents has left two businessmen: a Mexican and a Vietmanese, high and dry.

On Dec. 12, hundreds of Immigration and Customs Enforcement agents clad in riot gear and armed with assault rifles descended on the Swift & Co. meatpacking plant in a coordinated raid of six of the company's facilities nationwide. The operation was the government's largest single work-site enforcement operation ever. The plant in little Cactus -- a town better known in the state of Chihuahua, Mexico, and in the department of Quiché, Guatemala, where workers came from, than in Texas -- was the largest one raided. Almost a quarter of the 1,282 suspected illegal immigrants arrested in the raids were removed from the Cactus plant.
Sales of tortillas and other staples are down. Money wire transactions to Central America have mostly dried up. The "Guatemalas," as local residents call them, are almost all gone, and so are a significant number of Mexican nationals. An estimated 12 to 18 children are now living with only one parent since the other was arrested in a massive immigration raid at the biggest employer in town.

The story goes on:

Continue reading "Another follow up on the Swift raid: what happened to Cactus, TX." »

February 7, 2007

The net fiscal impact of illegal immigrants? New Jersey and Texas studies clash

A study of New Jersey asserts that illegal immigrants cost taxpayers $2.1 Billion. A Texas study last year asserted that the burden on taxpayers was $1.2 Billion. New Jersey’s total population is 8.4 million and it estimates its illegal immigrant population at 372,000. Texas in contrast has 20.8 million people of which 1.4 million are estimated to be illegal immigrants. How can New Jersey have almost double the taxpayer burden with less than 40% of the population of illegal immigrants?

And consider this: the New Jersey study authors say it is irrelevant what the contribution of illegal workers make in payroll taxes (yes, many pay payroll taxes) and consumer taxes. Why? Because for every illegal worker there is a legal American sitting on a bench ready to take the job if vacated! This is like saying that the taxpayer burden of red headed left handed persons is so many millions, and it doesn’t matter how much they pay in various taxes. Nor do the authors address a more important question, a step up in complication: what illegal immigrants add to the gross state product. Talk about one-sided accounting!

Per the Pew Hispanic estimates (you will find them on the right column under “undocumented workers by state”) there are 256,000 illegal workers in New Jersey and 1.024 million in Texas (2005 figures).

Go here for the Texas study, which I posted on in December.

The New Jersey study estimates these burdens on taxpayers: schools, $1.85 billion; healthcare $200 million; incarceration, $50 million. The Texas study has these comparable figures: schools, $967 million; healthcare $58 million; incarceration, $130 million.

The Texas study estimates that illegal households pay $867 million in consumption taxes and, per their rental or owned residences, $582 million in property taxes. With other payments, total payments by illegal immigrants into the public fisc are estimated at $1.581 billion, or $424 million higher than the total $1.156 billion burden on taxpayers.

February 5, 2007

Mexican remittances were $25 billion in 2006

The Houston Chronicle reports, "More cash flows home, remittances from Mexicans working abroad reach $25 billion."

Mexico City -- Mexicans working abroad sent home a record $25 billion last year, most of it from the United States, according to a study released Friday. The estimated figure represents a 25 percent increase over 2005 and a nearly 80 percent surge since 2003, the Inter-American Development Bank, or IDB, said in its report. Remittances have surpassed tourism as Mexico's second-largest source of foreign revenue, helping support more than 4 million Mexican families, said the Washington-based bank, which lends to 26 member countries in Latin America and the Caribbean. Oil is Mexico's largest foreign revenue producer.

The country's reliance on remittances from abroad is not necessarily a good thing, the bank said. 'No one should celebrate that Mexico is the largest remittances market in the world,' it said. 'It means the domestic economy is simply not generating enough jobs.'

Indeed, more than half of the Mexican emigrants surveyed in another recent study by the bank said they were unemployed before leaving for the U.S. Those who held jobs in Mexico earned an average of about $150 a month. By contrast, more than half found jobs within a month of arriving in the U.S., where they earned an average monthly salary of $900.

The bank made no distinction between Mexicans who were in the U.S. legally or illegally.

(More follows on the hyperlink.)

2/5/07 update on Swift raid

The Washington Post ran this article quoting the president of Swift as saying the raids were for show.

Meatpacker: Immigration Raids Were Show
The Associated Press, February 2, 2007

Greeley, CO (AP) -- The head of meatpacker Swift & Co. said federal officials wanted a high-profile example of an immigration crackdown when they staged raids at its plants in six states in an identity theft investigation late last year.

President and CEO Sam Rovit said the government rejected the company's offer to help in the investigation months before the Dec. 12 raids.

'They were looking for a marquee to show the administration it was tough on immigration,' he told the Greeley Tribune for a story published Friday.

Rovit denied knowingly hiring illegal immigrants and told the newspaper his company complied with federal hiring practices to check applicants' immigration status.

Rovit and an Immigration and Customs Enforcement spokesman did not immediately return phone and e-mail messages from The Associated Press Friday.

ICE arrested 1,282 workers during raids in Colorado, Nebraska, Texas, Utah, Iowa and Minnesota. Of those, 246 now face state or federal identity theft charges and the rest face immigration charges.

Greeley-based Swift says it is the world's second-largest processor of fresh beef and pork, and employs about 20,000 people, including about 15,000 in the U.S.

February 1, 2007

American immigration and world trade: the connection

From 1994 until NAFTA (The American Free Trade Agreement) took effect in 2001, “total trade with Mexico had increased by a factor of 2.3, the number of intracompany transferees crossing the border had risen by a factor of 5.6, the number of temporary workers by a factor of 4.8 and the number of tourists by a factor of 2.9.” This from an article by Douglas Massey, the Princeton professor about whom I have posted before. I read this week an article he wrote, as part of a WESAW course I am taking in my town.

Go here to find the article on migration.

Massey takes a global perspective on immigration: International migrant flows “are intimately connected to broader processes of economic integration that for the past half century have been shrinking the globe.”

Flows of commodities, services and information are matched by flows of people. The industrialized countries are caught in a “contradiction”: they want to globalize everything except the flow of people. America is dead center in this contradiction. As I posted before, we have the largest number of cities with at least one million in foreign born residents, but our politicians are largely fearful of immigration.

“Immigrants arrive because the same processes of globalization that create mobile populations in developing regions and a demand for their services in global cities also create links of transportation, communication politics and cultures to make international migration easier and cheaper.”

-- from Great Decisions, 2007 edition, the Foreign Policy Association

January 30, 2007

Swift plants for sale after raids?

Swift plants for sale?

An AP article on 1/24 suggests that the December raids on Swift, while not the only cause, may be a factor in Swift reportedly trying to sell its assets. I am running on speculation here, but is appears that – perhaps – the use of illegal workers allowed Swift to keep its labor costs down, and now without access to this labor, the economics of its plants deteriorated.

I have previously posted a Wall Street Journal article on this month on how labor costs in a chicken processing plant in Georgia rose after a raid and a shift to American workers.

My guess is that the use of illegal workers saves the employer at least 30% in labor costs. That savings can make an otherwise unprofitable business to be viable – so long as the cost of labor stays down.

Thanks to The Immigration News Blog for clueing my into follow up stories about Swift.

The article:

Swift Exploring Future Sale

By SANDY SHORE AP Business Writer
© 2007 The Associated Press

DENVER — Swift & Co., one of the nation's largest meatpacking processors, may find it more lucrative to sell its assets separately instead of as a whole or testing the market with a stock offering, industry analysts said.

The privately held Swift, which was targeted by a wide-scale immigration raid last month, is looking into strategies ranging from refinancing to a sale or initial public offering, a decision executives said was made after they received some unsolicited inquiries over the past six months.

With beef and pork processing plants in six states and an operation in Australia, Swift may find buyers more interested in pieces rather than the whole company, the analysts said Tuesday.

Continue reading "Swift plants for sale after raids?" »

January 20, 2007

Income tax and social security tax payments of illegal immigrants - a legal analysis

I located an article in the Harvard Latino Law Review analyzing the tax contributions of undocumented immigrants

Francine Lipman, The Taxation of undocumented immigrants: separate, unequal and without representation published in October, 2006. The article focuses in-depth on income tax and social security tax issues, and is heavily annotated. I found the article in the reports section of the website for the Massachusetts Immigrant and Refugee Advocacy Coalition, or
(MIRA).

January 17, 2007

Case study of employment results of a large ICE raid on a poultry plant

The Wall Street Journal ran an informative article today on the effect of a major ICE raid upon employer – employee relations. Evan Pérez and Corey Dade wrote the article. I posted on the raid of Crider Inc., a Stillmore, GA, poultry plant in May, 2006. The WSJ article describes the before and after:

BEFORE: employees mostly Hispanic. Workers provided company housing. Black employment since late 1990s had declined from 70% to 16%. High productivity, poor benefits and working conditions, and few employee complaints. Wages barely above minimum wage. Parking lot wage payments, in which checks were issued and immediately cashed by the employee, preventing any record of employment history. I infer that worker savings probably sent to Mexico.

AFTER: Wages increased 30% - 50%. Workforce is 65% black, 30% white, 5% Hispanic. Workers provided company housing. Much of workforce converted to independent recruiting contractor status and/or engaged through employee hiring firm. Productivity sags 10%. More complaints about worker health and safety. Labor shortages. Company searches across U.S. for people willing to work, such as Hmong migrant workers. I infer that worker savings now put into local housing, cars.

NATIONALLY, WHAT A GUEST WORKER PROGRAM WOULD DO: Boost wages by at least 30%. Prohibit independent contractor abuses. Better health and safety. Remove vulnerability of Hispanic workers to fear of deportation. Worker shortages. More investment in technology to reduce workforces.

Excerpts from the article, with some notes by me:

Continue reading "Case study of employment results of a large ICE raid on a poultry plant" »

January 8, 2007

Mexican immigrant worker economics - remittances are the goal

The Arizona Republic presented information from the most recent Inter-American Development Bank about Hispanic immigrants in the U.S. The article starts with a personal profile: “Take Martin Armenta, for example. The Phoenix resident takes home $380 a week after taxes from his job as a cook. Yet he sends more than a third of his paycheck to his wife and two children in Sonora. How does he do it? With some serious scrimping. Armenta, 31, shares a three-bedroom house with seven other immigrant men, watches TV for entertainment and never goes out to eat."

The key to creating jobs and other forms of economic development in Mexico and Latin American countries will be using remittances to finance micro-loans and mortgages. Those types of banking tools are currently unavailable to most poor people in Latin America, said
Sergio Bendixen, a Miami-based pollster who surveyed 2,511 Latino immigrants for a study of remittances commissioned by the Inter-American Development Bank. Communities in the U.S. also stand to benefit from remittances by creating co-ops that encourage immigrants to invest money here instead of sending it home, de la Garza said.

Sending more home

The Inter-American Development Bank survey found that between 2004 and 2006, the percentage of immigrants sending money regularly increased from 61 to 73 percent. Still, the majority of immigrants who send money home earn wages considered working-poor or lower-middle-class by U.S. standards. About three-fifths earn less than $30,000 a year. A third earn less than $20,000, according to the survey, which was released in October.
About half of Latino immigrants find a job within a month of arriving in the U.S., the survey said. The first jobs they find tend to pay low, about $900 a month. But on average that is six times the amount they were earning in their home country.

Frugal lifestyle

In Mexico, incomes vary widely, but government information suggests that the vast majority of Mexican workers makes less than $21 a day.
Armenta said he sends money home to his wife and two children, ages 9and 3, every week to help them buy food, clothing and medicine. The family owns its home in Ciudad Obregón, the second-largest city in Sonora. His biggest expense is a $150-a-week car payment for the 1990 Ford pickup truck he bought shortly after arriving in Phoenix. The remainder of his $380 weekly paycheck goes to pay for auto insurance, gasoline, rent and food. Armenta's monthly share of the rent, split eight ways, is about $230, including utilities. The only furniture in the house he rents is a sofa and a few chairs. For entertainment, Armenta watches TV. He doesn't have cable. He also doesn't have a bed. He said he sleeps on the floor. Armenta said he never goes out to eat.

January 4, 2007

Immigrant entrepreneurs involved in one quarter of technology start-ups

Foreign-born entrepreneurs were behind one in four U.S. technology startups over the past decade, according to a study published today.

A team of researchers at Duke University estimated that one quarter of technology and engineering companies started from 1995 to 2005 had at least one senior executive - a founder, chief executive, president or chief technology officer - born outside the United States.

Other pertinent studies are a 2000 study on Silicon Valley’s new immigrant entrepreneurs

Annalee Saxenian of U.C. Sanat Cruz was author of the 2000 study, involved in the 2007 study, and one of the top experts on immigrant worker involvement in high tech.

and this study: American made: Impact of immigrant entrepreneurs and professionals on U.S. competitiveness (no date)

Key findings:

•In 25.3% of technology and engineering companies started in the U.S. from 1995 to 2005, at least one key founder was foreign-born. States with an above-average rate of immigrant-founded companies include California (39%), New Jersey (38%), Georgia (30%), and Massachusetts (29%). Below-average states include Washington (11%), Ohio (14%), North Carolina (14%), and Texas (18%).

•Nationwide, these immigrant-founded companies produced $52 billion in sales and employed 450,000 workers in 2005.

•Indians have founded more engineering and technology companies in the U.S. in the past decade than immigrants from Britain, China, Taiwan, and Japan combined. Of all immigrant-founded companies, 26% have Indian founders.

•The mix of immigrant founders varies by state. Hispanics constitute the dominant group in Florida, with immigrants from Cuba, Colombia, Brazil, Venezuela, and Guatemala founding 35% of the immigrant-founded companies. Israelis constitute the largest founding group in Massachusetts, with 17%. Indians dominate New Jersey, with 47% of all immigrant-founded startups.

•Chinese (Mainland- and Taiwan-born) entrepreneurs are heavily concentrated in California, with 49% of Chinese and 81% of Taiwanese companies located there. Indian and British entrepreneurs tend to be dispersed around the country, with Indians having sizable concentrations in California and New Jersey, and the British in California and Georgia.

•In 2006, 24.2% of U.S.-originated international patent applications were authored or co-authored by foreign nationals residing in the U.S. These immigrant non-citizens, as we called them, are typically foreign graduate students completing their PhDs, green card holders awaiting citizenship, and employees of multinationals on temporary visas. This percentage had increased from 7.8% in 1988—and this count doesn't include immigrants who had become citizens.

December 31, 2006

From the Economist: government policies to attract the highly talented worker.

In its special report on the search for the talented worker, the Economist noted: “Two economists, Frédéric Docquier and Hillel Rapoport, estimate that average emigration rates worldwide are 0.9% for the low-skilled, 1.6% for the medium-skilled and 5.5% for the high-skilled. These rates have been accelerating far faster for the high-skilled group than for the rest. Skilled immigrants accounted for more than half of all admissions in Australia, Canada and New Zealand in 2001.”

also….

Germany has made it easier for skilled workers to get visas.

Britain has offered more work permits for skilled migrants.

France has introduced a “scientist visa”.

Many countries are making it easier for foreign students to stay on after graduating.

France is aiming to push up its proportion of foreign students from about 7% now to 20% over time.

Germany is trying to create a Teutonic Ivy League and wants to “internationalise studies in Germany”.

A survey of Indian executives living in America found that 68% were actively looking for opportunities to return home, and 12% had already decided to do so; and a survey of graduates of the elite All India Institute of Medical Sciences who were living abroad found that 40% were ready to go home.

Beijing has an office in Silicon Valley

The section of the special report on government policies, in full:

Continue reading "From the Economist: government policies to attract the highly talented worker." »

December 29, 2006

A case of sex work coercion of illegal immigrants in the U.S.

Luring illegal immigrants into a country for the purpose of coerced sex work is widely reported elsewhere but rarely reported in the U. S. Surely it happens. How bad is the problem? Several years ago I tried to find a pattern in San Francisco and found none, after talking with people informed about the sex work trade.

This Los Angeles Times article starts with: “Four women from Guatemala have been arrested as part of a scheme in which young women were lured into the U.S. with promises of good jobs and forced to become prostitutes in Los Angeles.”

Charged with importing and harboring undocumented immigrants as well as harboring them for prostitution were Gladys Vasquez Valenzuela, 36; her sisters, Jeanette, 25, and Albertina, 48; and Albertina's daughter, Maria Vicente de los Angeles, 27. Another relative, Maribel Vasquez Valenzuela, is being sought by authorities.

The investigation began three months ago when two alleged victims of the ring escaped with the help of a male customer and contacted authorities, according to the U.S. attorney's office. Two other victims were rescued by investigators last month. Ten women at the locations raided Wednesday were also believed to have been working as prostitutes and were being interviewed by authorities to determine if they also were victims.

The story continues….

Continue reading "A case of sex work coercion of illegal immigrants in the U.S." »

December 25, 2006

Economics of remittances from U.S. to Brazil

Bendixen Associate's website posted a study presented in March, 2006, drawing from a survey of Brazilians done in 2004. here are a just a few items in the presentation:

When was survey done? April - May 2004
Who received remittance? female 65% male 35%
Age of recipient: 52% are 35 or younger
How often are remittances received: at least once a month 44%; between 2 and 6 months 23%, once a year 35%
For how long: less than a year 20%, 1 - 3 years 42%, 3 -5 14%, 5 or more year 24%
Average household income of recipient: 69% under $10,000
From where? 50% US, 31% Europe, 17% Japan

December 13, 2006

Case study of immigrant workers in Hilton Head

The Wall Street Journal (subscription required) ran a story on Wednesday of how a black couple built a roaring business in dry wall work in Hilton Head Island, using Hispanic labor, only to see it wither in the face the competition from former employees. This is a good case study of how immigrant labor has been cutting the cost of residential construction and creating havoc among sub-contractors.

Per the WSJ:

In 1997 the stucco business made $971,000, according to the Hairstons' tax return. To handle his blossoming business, Mr. Hairston rented a large office with four rooms, two restrooms and warehouse space behind it. He bought a condominium and a plot of land as investments. Flush with success, the Hairstons broke ground on a 7,600-square-foot, three-story house with an ornate gold-and-black gate, a cherub fountain in the front and a large swimming pool in the back.

As Hilton Head prospered, more and more Mexican immigrants flocked there. From 1% of the population in 1995, Latinos accounted for 11% of Hilton Head's 34,000 residents in 2000, according to census figures. Officials peg the current Latino population at about 15%.

One immigrant who prospered was Fidel Serrano.

After eking out a living as a baker at a doughnut shop in Houston for five years, Mr. Serrano moved to Hilton Head Island in 1994, joining two brothers who had recently settled there. "There was plenty of work and life was calmer here for the kids," recalls Mr. Serrano, a native of Mexico. Mr. Serrano, his wife, two sons and two brothers rented a rundown two-room trailer, for which they collectively paid $600 a month.

Mr. Serrano began to work in stucco, perfecting his skills as an employee of Mr. Hairston's Pro Plastering & Stucco. He says he earned $8 to $10 an hour during the two-and-a-half years he worked for Mr. Hairston. In the beginning, Mr. Serrano recalls, Mr. Hairston still employed several black workers. But gradually Mr. Hairston came to rely more on Mr. Serrano and other Mexican immigrants. "We showed up for work every day and we were dedicated," Mr. Serrano recalls.

Around 2000, Mr. Serrano struck out on his own, working as a subcontractor to Mr. Hairston. He supplied Mr. Hairston with crews for several jobs. "I was able to train the workers," who were all Spanish speakers, he recalls. Mr. Hairston typically paid him about 25% of the value of the contract for the job, he says. Mr. Serrano says that he pays taxes on all his workers, as well as workman's compensation.


….further down in the article:

Continue reading "Case study of immigrant workers in Hilton Head" »

December 8, 2006

Remittances from U.S. to Mexico, 1995 – 2005


Wikipedia
has a well developed entry on illegal immigration to the United States. One of its tables tracks the growth of remittances to Mexico. They grew at a phenomenal rate in the past ten years, from a little under $4 billion to over $20 billion, according to Mexican banking officials. I have entered below by year the amount of remittances and the annual percentage of increase. I surmise the growth rate was spurred mostly by increases in per capita earnings of Mexican workers here – legal and illegal, for the scale of the growth cannot be accounted for by the increase in population. As I have posted before, the number of Mexican households earning more than $100,000 increased by 65% between 2000 and 2005.

The Mexican study which presented the data is found here.

year, dollars in millions, % change over prior year

1995 3.673
1996 4.224 15.0%
1997 4.865 15.2%
1998 4.744 -2.5%
1999 5.910 24.6%
2000 6.573 11.2%
2001 8.895 35.3%
2002 9.814 10.3%
2003 13.396 36.5%
2004 16.613 24.0%
2005 20.035 20.6%

November 24, 2006

Guest workers in the future: union organizing

A new book assesses the potential for organizing immigrant workers, citing examples among Los Angeles area building maintenance, trucking, construction, and garment production workers. If a guest worker program is enacted, it is very likely that the enrolled workers will have the right to collective bargaining. According to the publisher, “Los Angeles’ recent labor history highlights some of the key ingredients of the labor movement’s resurgence—new leadership, latitude to experiment with organizing techniques, and a willingness to embrace both top-down and bottom-up strategies.”

L.A. Story: Immigrant Workers and the Future of the U.S. Labor Movement, released this past August by the Russell Sage Foundation, is written by Ruth Milkman, professor of sociology and director of the Institute of Industrial Relations at the University of California, Los Angeles.

The publisher’s blurb:

Continue reading "Guest workers in the future: union organizing" »

October 14, 2006

Immigrant labor essential for New Orleans recovery

I'm in New Orleans and have had conversations with people about rebuilding the residential areas. Thousands of homes have yet to be touched, but thousands are being repaired, some with replacement of all the walls. My friend Dan lives in the scacely hurt area of "Uptown." He is doing major renovations on a 3,000 foot residence. He told me that Brazilian workers from Massachusetts are essential to getting the work done. (There is strong demand for housing.) I talked with Glenn and Brad about the large, 7,500 household neighborhood of Lakeview. This is one of the most actively rebuilding neighborhoods -- virtually all homes were 4 or more feet underwater for a week. Glenn told me that governmental agencies have been well meaning but pretty much useless in the rebuilding. He said that the rebuilding could not be done without (1) Hispanic workers and (2) Wal-Mart and Home Depot stores.

And--the first restaurants to reopen were ethnic restaurants because only they had enough staff.

October 13, 2006

Remittances to Mexico expand, new Federal Reserve program helps

The Wall Street Journal (subscription required) reported on 10/11 on advances in the remittance business, which I have posted about in the past. Remittance volume to Mexico this year may exceed $23 billion.

“Dubbed "Directo a Mexico," the [new] remittance program enables U.S. commercial banks to make money transfers for Mexican workers through the Federal Reserve's own automated clearinghouse, which is linked to Banco de Mexico, the Mexican central bank.” User fees: as little as $2.50 a transaction.

“To use the service, a Mexican need only possess a matricula consular, an I.D. issued by the Mexican consulate in most major U.S. cities to those with proof of Mexican birth or citizenship, or a picture I.D. card issued by the U.S. or another foreign government.”

One desired effect of the program is to increase the use of banks by Mexicans on both sides of the border. “…One of the Federal Reserve Bank's goals is to use the program as a springboard for drawing hundreds of thousands of immigrants into the formal U.S. banking system since commercial banks require that those wanting the service first open a savings account.

“Last month, the program was expanded to enable migrants in the U.S. to open an account for relatives to whom they plan to send money. A bank teller in the U.S. can open the account remotely on a Web site set up by Mexico's Banco del Ahorro Nacional y Servicios Financieros, the development bank known as Bansefi, which has a vast network of branches in urban and rural areas.”

For undocumented workers, “the Federal Reserve's brochure poses the following frequently asked question: "If I return to Mexico or am deported, will I lose the money in my bank account?" The answer: "No. The money still belongs to you and can be easily accessed at an ATM in Mexico using your debit card."

September 27, 2006

“Subidos” or Mexicans working legally in migrant construction work

The Wall Street Journal on 9/18 (payment required) tracked the work migration of a Cantu family men – self-described subidos. These are Mexicans with green cards, who leave their families in Mexico and pick up relatively well paying jobs on a contract to contact basis, crisscrossing the United States.

“Thanks to quirks in the law, they have green cards enabling them to come to the U.S. for work stints. Many, like the Cantús, call themselves 'subidos' from the Spanish verb for 'to rise,' because they do the grueling jobs of pouring concrete for tall structures such as grain silos for the ethanol plants increasingly rising across the Great Plains. "

By quickly filling jobs and providing needed skills, such workers are a boon to employers. They rarely put a burden on social services, because they leave their school-age children and elderly relatives at home. Nonetheless, there is some evidence that the Mexicans drive down wages in the industries where they work.

Some guest workers had their status legalized under the Simpson-Rodino Immigration Reform and Control Act of 1986, which granted amnesty to 2.7 million undocumented workers. It offered that group, who call themselves 'Rodinos,' the chance at green cards that confer permanent-resident status and the right to work. The act was intended to encourage U.S. citizenship, but some preferred the guest-worker way of life, as the Cantús do, earning wages in the U.S. but keeping their families and their living costs in Mexico.

Others acquired work visas through programs that legalized imported farm workers during times of labor shortages. Still others won green cards after being sponsored by a parent who became a naturalized U.S. citizen, or by marrying a U.S. citizen. About 100,000 Mexicans also legally commute short distances across the border for day jobs in the U.S.

Continue reading "“Subidos” or Mexicans working legally in migrant construction work" »

August 29, 2006

Mexican remittances at annual rate of $20 billion

From the AP: The Mexicans living abroad sent $11 billion home in the first half of 2006, an increase of 23 percent over the same period last year, the government news agency Notimex reported Friday. Remittances have become an increasingly important source of income for the country in recent years, surpassing tourism. They represent Mexico's second-largest source of foreign income after oil. They topped $20 billion for the first time in 2005, a 17 percent increase from the previous year.

This is double the rate of $10 billion used in analyzing the commerce of remittances by companies such as Wal-Mart.

August 27, 2006

Wal-Mart further penetrates the banking activities of Mexicans

From the Los Angeles Times comes an article about Wal-Mart’s upcoming creation of a Mexico-domiciled bank. Its initiative may have an important impact on how Mexicans in the United States conduct their financial transactions with their home country. There are several converging stories here. First, improving access to low cost banking in Mexico. Second, broadening of Wal-Mart’s extensive U.S. operations in check cashing and expediting remittances from workers to Mexico. Third, a complement to Wal-Mart’s U.S. plan to open “industrial loan corporations,” or stripped down banks, among its 3,900 domestic stores. All in all, Wal-Mart is becoming the banking intermediary of choice of Mexicans living and working in the U.S.

In a prior posting, I wrote how “the Mexican worker in U.S. remits on average $2000 a year to Mexico. Average individual remittance is $300, with transaction fees of $10 to $20. This is a $3.5 billion business growing to $10 billion. This source estimates that only 25% of Mexican workers have a bank account, which presumably supports its $10 billion forecast.”

Excerpts from the article:

The unit, Wal-Mart de Mexico, confirmed this month that it had applied for a banking license, raising the possibility that Wal-Mart shoppers south of the border soon may be opening checking accounts and taking out auto loans while filling up their grocery carts.

Mexican customers can already get store-branded credit cards that Wal-Mart offers through third-party providers. They can wire money, make deposits, cash checks and perform other transactions thanks to agreements the retailer has made with institutions including BBVA Bancomer and MoneyGram International to operate branches and ATMs inside some stores.

Continue reading "Wal-Mart further penetrates the banking activities of Mexicans" »

August 11, 2006

Pew Hispanic Center: immigration has not hurt American workers

The Washington Post reports on a new study concluding that American workers have not been harmed by immigrant labor. From the summary of the report, below, I’m not sure how much confidence I have in it. A major limitation of all the immigrant impact studies I have seen is that they do not take into account concentration of immigrant labor in industries which may be in fast growth mode and also cyclical. New immigrant labor in a region may depress wages of Americans in some fields and actually stimulate better wages and job growth for Americans in other fields by providing scarce resources of low wage labor. Skilled American construction workers can be said to benefit by the supply of unskilled and semi-skilled immigrant labor.

The article includes these passages:

High levels of immigration in the past 15 years do not appear to have hurt employment opportunities for American workers, according to a new report. The Pew Hispanic Center analyzed immigration state by state using U.S. Census data, evaluating it against unemployment levels. No clear correlation between the two could be found. Other factors, such as economic growth, have likely played a larger role in influencing the American job market, said Rakesh Kochhar, principal author of the report and an economist at the Pew Hispanic Center.

The study used Census Bureau data to compare the influx of immigrants and unemployment rates in each state between 1990 and 2000, a period of robust economic growth, and between 2000 and 2004, a period of slower growth. "We are simply looking for a pattern across 50 states, and we did not find one," Kochhar said. "We cannot say with certainty that growth in the foreign population has hurt or helped American jobs."

In the 10 states with the top employment rates from 2000 to 2004, for example, five states showed a high influx of immigrants while the other five showed little growth in the foreign-born population. "Even in relatively slow economic times, a relationship fails to reveal itself," Kochhar said.

Some economists expressed reservations about the technique yesterday, arguing that such broad statewide data do not give an accurate picture of immigration's effects on the labor market. "There's an age, gender and educational component to this story that this report does not address," said Andrew Sum, director of the Center for Labor Market Studies at Northeastern University. Between 1990 and 2000, he said, immigrant workers did not take jobs away from American workers "because the strong economy was creating enough jobs to employ everyone who was looking for work." But in the past five years, a subset of the workforce -- native-born men age 16 to 24 with high-school diplomas -- have in fact been displaced by immigrants, he said. "We argue that immigrant labor has changed the nature of work in a very negative way," Sum said.

On the local level, too, some experts disputed the findings of the Pew report. While educated workers with specialized skills are not likely to be displaced by foreign-born workers, young unskilled laborers have felt the pinch in recent years, said Steven A. Camarota, director of research for the Center for Immigration Studies in the District.

A recent study done by the center shows that the immigrant share of the young workforce in Maryland and Virginia nearly doubled in the past five years, peaking at 22 percent and 15 percent, respectively, in 2005. "Native workers who have little education in Maryland and Virginia are dropping out of the labor markets in droves" as the number of immigrants grows, he said. "Unskilled workers only account for a fraction of the total economic output, but if immigration plays a role in even a part of [the trend], that's something we should be concerned about."

The report pointed out that immigrants typically move to booming areas of the country with low unemployment rates. "It's unclear as to whether immigrant workers help to cause that boom, but they certainly haven't detracted from it," said Randy Capps, a senior research associate at the Urban Institute.

July 28, 2006

A source of practical advice for immigrant professionals

Leslie Kamenshire, a college administrator, began a few years ago to help foreign professionals in the Washington, DC area, to speed up their entry into the American workforce. She started a website, immigrantcareers.com, and published a book, Career Guide and Directory for Immigrant Professionals (Washington Metropolitan Area). She also has run some workshops. I just learned about her work and hope to post about her again soon.

She held a 7/20 workshop at which was directed to health professionals, lawyers, engineers, accountants, etc., and addresses these practical problems:

• how to get needed license or certification in Virginia, DC, Maryland

• who can help you prepare for the licensing exam

• who can evaluate your foreign credentials

• what are employment needs in the Washington area – & perhaps elsewhere

• where can you obtain help to start a small business or high tech venture

July 9, 2006

Do immigrants depress existing wages?

The New York Times Sunday Magazine today carried a long article, “The Immigration Equation,” By Roger Lowenstein. Much of the article focuses on the debate about whether Hispanic immigration has depressed wages in the United States. I have posted several times on this – citing the major “yes” academic, George Borjas of Harvard, and the most prominent “no” academic, David Card of U.C. Berkeley. Here, I will excerpt some interesting passages. I include a summary of Card’s study of the labor market effect of a large shift of Cubans to southern Florida (the 1980 Mariel boat lift), and another researcher’s study of the effect of Russian immigration to Isreal. Both studies concluded that the effect was neutral to positive for the income of the existing workforce. This is not surprising to me because, in my judgment, a pretty healthy modern market economy can be very creative about the use of new resources (labor, capital, land, bananas, etc.) without seriously harming any large stakeholder.

How the skill mix of immigrants differs significantly from the 1880-1921 period of high immigration to the current period:

Continue reading "Do immigrants depress existing wages?" »

July 6, 2006

More on remittance traffic to Latin America

I have previously posted on Hispanic worker banking patterns in the U.S. and on the record $53.6 billion in remittances in 2005 from all worldwide sources to Latin America. Where did the money go? Some interesting information flows below, including how remittances to the Dominican Republic can be home delivered within hours of being sent, how much is sent, and from where in the U.S. and elsewhere, and to where (top three countries are in order Mexico, Brazil and Columbia).

MoneyGram International, Walmart’s remittance partner, sends cash from some 100,000 locations in 170 countries. As Latin Business Chronicle reports, "We've seen very significant growth to Latin America - over 45 percent versus a year before," says Augusto Esclusa, the company's Miami-based marketing manager for US outbound shipments to Latin America.

The article goes on: In Honduras, remittances accounted for 22% of the country's GDP last year, a Latin Business Chronicle analysis of the IDB data and figures from the International Monetary Fund shows. In El Salvador, remittances accounted for 17.1% of GDP and it was also key to economies like Nicaragua (12.2%), the Dominican Republic (12.2%) and Guatemala (10.9%).

Remittances were larger than foreign direct investment last year in countries like Mexico, Colombia, the Dominican Republic Ecuador, El Salvador, Guatemala, Honduras and Nicaragua, according to a Latin Business Chronicle analysis of the IDB data and fresh figures from the UN Economic Commission for Latin America and the Caribbean (ECLAC).

Compared with exports, remittances were larger in Haiti and [were equivalent to] 60.9% of El Salvador's exports and 58.8% of Guatemala's exports, according to our analysis. Remittances also accounted for a high percent of exports from other countries like Nicaragua (45.4%), Bolivia (28.8%), the Dominican Republic (27.2%), Colombia (16.7%), Paraguay (16.1%) and Peru (13.1%), the analysis shows. Although they play a smaller role in Mexico measured in percent of exports (8.9%), that figure is still considerable.

Continue reading "More on remittance traffic to Latin America" »

June 27, 2006

Wage and benefits by job category, U.S.

WorkersCompInsider has summarized hourly wage and benefits compensation and provided this link to a federal pfd document listing this information for over a hundred job catregories. The data are for March 2006.


June 18, 2006

Fake IDs among Massachusetts construction workers

The Boston Globe ran a story on Sunday (no link available) about the ways in which undocumented workers become workers at construction worksites. Article by By Jonathan Saltzman and Yvonne Abraham, June 18, 2006:

A Globe analysis of nine recent public works projects -- from dormitory construction at the University of Massachusetts at Dartmouth to the building of the new Middlesex County Jail -- revealed that of 242 workers on weekly payroll lists, more than a third appeared to lack legitimate Social Security numbers. On one of the payrolls reviewed, for masonry work on the UMass dormitory project, nearly two-thirds of the contractor's 87 workers had bogus or questionable Social Security numbers.

The numbers used by the workers in many cases appeared obviously fraudulent. One laborer who helped build the new jail in Billerica submitted a number that should have immediately raised eyebrows: 666-66-6666. Some numbers belonged to people who were long-deceased, the Globe found. Others were matched to people who live out of state and had no idea their numbers had been appropriated.

The findings, though a small snapshot of the vast number of public projects undertaken throughout the state, suggest how the use of undocumented workers has extended into almost every corner of the economy. Republicans in Massachusetts trumpeted plans last month to stiffen fines on companies that knowingly hire undocumented immigrants, which is illegal under state law. But there is no requirement that employers, including those receiving public funds, demonstrate that their workers are legal, and undocumented workers employed on the projects say that contractors are all too happy to look the other way.

Continue reading "Fake IDs among Massachusetts construction workers" »

May 12, 2006

Labor centers for immigrant workers

If one takes into account well staffed entities as well as simple hiring halls, there are probably up to 200 centers dedicated to supporting immigrant workers in obtaining work, learning about American labor practices, and securing their labor rights. I have been to two such centers: The Brazilian Immigrant Center in Boston, and the Watsonville Law Center in Watsonville, CA. I have also visited a makeshift center – more of a hiring hall – in Brooklyn.

Janice Fine of Rutgers University has published a book on this topic: “Worker Centers: Organizing Communities at the Edge of the Dream”. Cornell U Press summarizes the book: “[She] identifies 137 worker centers in more than eighty cities, suburbs, and rural areas in thirty-one states. These centers, which attract workers in industries that are difficult to organize, have emerged as especially useful components of any program intended to assist immigrants and low-wage workers of color. Worker centers serve not only as organizing laboratories but also as places where immigrants and other low-wage workers can participate in civil society, tell their stories to the larger community, resist racism and anti-immigrant sentiment, and work to improve their political and economic standing.”

Fine defines labor centers as “community-based mediating institutions that provide support to low-wage immigrants. Part settlement house, part local civil rights organization, and part union, the centers pursue this mission through a combination of approaches.”

Pablo Alvarado of the National Day Labor Organizing Network proposed seven characteristics of a well runs center:

Continue reading "Labor centers for immigrant workers" »

May 10, 2006

Wages and economics of immigrant restaurant workers: a case study

The Washington Post profiled the Oval Room Restaurant, on Connecticut Avenue. The writers follow the economic trail of Walter Velasquez, a 40 year old Salvadorean waiter. He came to America illegally; now his eldest child, 17, aspires to become an immigration lawyer. The Post article touches on his household finances, the public's cost of uninsured healthcare and educating children, and the economics of the restaurant industry.

"The sous-chef, a Panamanian immigrant, directed two cooks from El Salvador, one from Guatemala and one from Honduras. A Salvadoran immigrant ran the food to the tables. All the activity was monitored by the general manager, an Austrian by birth, who needs to satisfy the owner, originally from India. "We would not exist without immigrant labor," said Ashok Bajaj, owner of the restaurant. "If the laws change, the entire economics of the restaurant industry would change, too."

Bajaj, a New Delhi native who moved here from London in 1988, was willing to invest a million dollars here because of the availability of labor at attractive prices. His dishwashers make about $10 an hour, line cooks about $14 an hour, and sous-chefs $20 or so. About 70 percent of the restaurant's employees were born outside the United States; overall in the Washington region, about 45 percent of food-service workers are immigrants, according to an analysis of federal data by the Pew Hispanic Center.
[The] household finances of [Walter Velasquez], a Salvadorean waiter at the Oval and his restaurant-working girlfriend] show how immigrants support the U.S. economy -- but also incur costs for public services. He makes about $30,000 a year. Avila, who works fewer hours, earns about $18,000. They pay $1,300 a month in rent and pay Comcast $140 a month for cable television and high-speed Internet service. Comcast has added more than 30 foreign-language channels in the past eight years. The couple spends $150 a week on groceries, much of it at the Giant Food store on Columbia Pike, which has a large selection of ingredients that are common in Central America.

Velasquez's [the waiter’s] family also exacts costs on the economy. He sends about $100 a month home to family in El Salvador, which does not create new economic activity here. According to the Pew Hispanic Center, in 2000, such remittances amount to $10.2 billion for Mexico and four Central American nations. If the uninsured Velasquez were to have a serious medical problem, the cost would probably be borne by the hospital that treated him. ("We just can't be sick," he said.) Inova Fairfax Hospital, near Velasquez's home, provided $75 million in health care last year to people who were too poor to pay and had no insurance, many of them immigrants, said Ron Ewald, the hospital's chief financial officer. "It can be very volatile and extremely costly," he said.
There are local costs too. The Arlington County school system is spending $16,464 per pupil this year, or more than $32,000 for his school-age children. School spending is supported partly by state and federal governments but most significantly by property taxes, which Velasquez pays indirectly with his rent. But what the school system spends on his children's education can also be viewed as an investment in the next generation of U.S. workers. On Thursday, as Velasquez gathered his things to head back to work, his 17-year-old daughter, Alma, described her plans. After high school, she plans to go to a community college for two years, to save money, then transfer to a four-year university. Ultimately, she wants to be an immigration lawyer. "It came to me because my parents went through so much to get here," she said.

April 16, 2006

Another look at immigrant workers and declining labor force participation

The bumper sticker to this posting is that among several factors causing relatively fewer Americans to be employed or look for work, one of them is higher numbers of illegal workers. And one of the factors buried in the statistics of incremental decline in labor force rates is a positive one: not working in order to invest in education. Many young Americans continue to arrive at adulthood poorly educated, and they are vulnerable regardless of the presence of illegal workers. It is short-sighted to isolate the illegal workforce out of a more complex and more difficult set of conditions.

Continue reading "Another look at immigrant workers and declining labor force participation" »

April 14, 2006

Ten reasons why illegal immigrants should file income tax returns

The very well managed About.com site, by Jennifer and Peter Wipf, on immigration issues has has a checklist of reasons why it is in the interest of undocumented workers to file income tax returns. Bob Alcorn, a Dallas CPW, prepared the list. Here is a summary.

According to Alcorn, “Non-citizens who reside in the U.S. for more than 183 days [generally] meet the definition of a ‘tax resident,’ or a ‘resident for tax purposes.’ They are "subject to the tax laws as if they were citizens (with some minor differences).”

1. It's the Law.
2. Proof of Presence
This proof may be required if and when any future guest worker program or amnesty provisions are made.
3. Proof of Spouse's Presence and/or Spousal Relationship
Tax returns indicate your marital status (single, married, head of household), thus possibly later improving or proving a spouse's eligibility for any guest worker or amnesty claims.
4. Proof of Dependents' Presence and/or Relationship
5. Proof of Income and Self-Sufficiency
6. Possible Eligibility for Tax Benefits/Credits
Tax returns allow you to receive certain tax benefits - such as the Child Tax Credit, including the refundable portion of the Additional Child Tax Credit if you otherwise qualify.
7. Tax Payer Identification Number Eligibility
Filing tax returns provides a legitimate basis for getting an Individual Taxpayer Identification Number. Having a legitimate TIN is actually much less of a red flag than using a fake Social Security number at work or for finances and taxes.
8. Proof of Income as Basis for a Mortgage and Other Credit
9. Demonstration of Good Moral Character
In any immigrant legalization process, the applicant needs to demonstrate "good moral character."
10. It's Good to be Prepared, Just in Case

April 13, 2006

recruitment of foreign nurses to the United States

The New England J of Medicine on 10/27/05 carried an article about global patterns of recruitment of nurses. There is a global shortage of nurses. In the United States, the shortage is estimated at 126,000.

In an earlier posting, I reported that of the roughly 3,000,000 nurses in the country, about 11% are foreign workers. The authors say that the United States cannot expect to resolve a nursing shortage by foreign worker recruitment, in part because of global shortages of nurses. A letter responding to the article asserts that low compensation and few education slots are responsible for the nursing shortage.

The article reports that in 2005 a new law to expedite nursing recruitment from overseas was passed: the Emergency Supplemental Appropriations for Defense, the Global War on Terror, and Tsunami Relief. The law provides for 50,000 new foreign nurses. The law discards a prior policy of requiring that each recruitment be backed up with a prevailing wage certification.


this problem is the fact that as baby boomers are growing older and their medical needs are increasing, enrollment in nursing schools is declining. Increasing demands on nurses, partially a result of the shortage of nurses, have led to early career burnout, with as many as 20 percent of nurses retiring early. The Department of Health and Human Services projects that by 2020, the shortage of registered nurses in relation to demand will reach 29 percent, with more than 1 million nursing positions left open.

About recruiting of foreign nurses in the United Kingdom….

For years, the National Health Service (NHS) of the United Kingdom relied heavily on the direct recruitment of nurses from African countries such as Botswana, Ghana, Malawi, Nigeria, Kenya, South Africa, Zambia, and Zimbabwe — all former British colonies. These very countries have been among those hit hardest by the HIV pandemic; some have a prevalence of HIV infection of 30 to 40 percent, with a majority of the young, working population debilitated by disease, and are reporting huge nursing shortages themselves….More than half the nursing positions in Kenya and Ghana remain unfilled. As a result, many health clinics in Kenya have closed and many others are severely understaffed. The nursing shortage in the developing world is being felt more intensely even as increased foreign aid becomes available to provide drugs for millions of people with AIDS.

Continue reading "recruitment of foreign nurses to the United States" »

Economists surveyed about impact of illegal immigrants

On 4/13 The WSJ reported a survey of economists about the undocumented workforce’s impact on the economy. Basically, the economists say that the workers have made it difficult for some Americans workers, but that the overall impact is positive. According to the article, “Nearly 80% of economists who responded to questions about immigration in the latest WSJ.com forecasting survey said they believe undocumented workers have an impact on the bottom rung of the wage ladder. Twenty percent believe the impact is significant, while 59% characterize the effect as slight. The remaining 22% said there is no impact.”


About half of the economists said the presence of illegal immigrant workers has slightly reduced the overall rate of inflation in the economy, while 8% said the inflation rate has been reduced significantly. But 41% said they believe undocumented workers have had no impact at all on inflation.

On balance, nearly all of the economists – 44 of the 46 who answered the question – believe that illegal immigration has been beneficial to the economy. Most believe the benefits to business of being able to fill jobs at wages many American workers won't accept outweigh the costs.


April 12, 2006

Economic impact of a guest worker program on American agriculture


Fox News
carried on 4/10 a story, “Farmers Keep Wary Eye on Immigration Debate” which has some good interview quotes. The nub of the article is that farm owners need Hispanic workers and they need them cheap ($10 and hour). A guest worker program will provide the workers, but I expect at a noticeably higher cost. I have noted that the bill sent out by the Senate Judiciary Committee had an “AgJobs” component.here.

Here is my posting about my own remote state of Vermont depending on Hispanic workers to keep its diary industry alive --if only for the tourism industry.

From the Fox News article:

Cutting farmers' access to cross-border workers without giving them an alternative could cost the industry up to $9 billion in annual production, according to the American Farm Bureau Federation, which has long lobbied for a streamlined temporary worker program.

Continue reading "Economic impact of a guest worker program on American agriculture" »

April 5, 2006

Douglas Massey of Princeton: a blast of fresh air on Mexican immigrant workers

Douglas S. Massey, Princeton University professor, has closely studied Mexican immigrants and comes up with energetic, constructive interpretations of worker migration into the United. States. I will summarise several of his books. He also wrote an op-ed piece in the New York Times on Monday. One of his most intensely argued points is that border security-alone advocates hugely misperceive what the Mexican worker migration is all about. Massey's broad view puts our immigration issues in the context of 160 million immigrants troughout the world.

Crossing the Border (2004) (co-editor)

The full title: “Crossing the Border: Research from the Mexican Migration Project” (2004). Per the review in Amazon, the book draws from “the largest, most comprehensive, and reliable source of data on Mexican immigrants currently available". It is a myth-breaking book:

Continue reading "Douglas Massey of Princeton: a blast of fresh air on Mexican immigrant workers" »

April 4, 2006

Study: without immigrants, almost 2 million poorly educated Americans would be back in labor force.

The Center for Immigration Studies issued a report in March which estimates the negative impact of poorly educated immigrants upon the employment of poorly educated Americans. It finds a strong impact.

Dropping Out: Immigrant Entry and Native Exit From the Labor Market, 2000-2005” by Steven Camarota of the Center for Immigration Studies points to higher unemployment rates by industry and lower workforce rates of Americans, by age cohort. He estimates that without the increase in immigrant labor, amost 2 million Americans with a high school degree or less would be in the labor force.

He concludes in part:

The findings of this report call into the question the idea that America is desperately short of less-educated workers. In 2005, there were 3.8 million unemployed adult natives (18 to 64) with just a high school degree or less and another 19 million not in the labor force. Moreover, between 2000 and 2005 there was a significant deterioration in the labor market prospects of less-educated adult natives. The labor force participation has fallen significantly for both natives without a high school degree and those with only a high school degree. Had it remained the same in 2005 as it had been in 2000, there would have been an additional 450,000 adults without a high school degree in the labor force and 1.4 million more adult natives with a only high school degree in the labor force. This decline in particularly troubling because these workers already have lower labor force participation and higher unemployment than more educated workers. They also tend to be the poorest Americans.
Among teenage natives (age 15 to 17), labor force participation has also declined. At the same time that natives have been leaving the labor market, the number of immigrants with a high school degree or less in the labor force increased by 1.6 million. Wage growth among less-educated adult natives has also lagged well behind more-educated workers.

April 2, 2006

Anti-guestworker panel argues its case

I have condensed the transcript of a March 3 2006 panel discussion called: Guestworker Programs: Do They Make Sense for America? The meeting was sponsored by the Center for Immigration Studies, and the transcript came from its website. All the panelists are vocal critics of the guestworker program. I have divided the posting into major segments: (1) 1986 IRCA failed in processing, enforcement, and numbers of evaders, (2) economics of farm labor and what happens when labor costs rise (we adjust) (3) net cost to taxpayer even after guestworker program of $10B, and (4) How to deal with current 12 million illegal immigrants (attrition).

Continue reading "Anti-guestworker panel argues its case" »

March 30, 2006

Latin American migrants send back $54B in year in remittances

Migrant workers from Latin America and the Caribbean sent home $53.6bn to their families last year, an increase of 17% from 2004. The remittance are sent from the U.S, Canada, and other developed countries. This is according to a Financial Times report on an upcoming study by the Inter-American Development Bank. The study "confirms Latin America's position as the biggest market in the world for remittances. For the third consecutive year, remittances to the region exceeded the combined flows of direct foreign investment and overseas economic aid."

The FT report does not appear to distinquish between Latin Americans who have become citizens, those who are legal immigrants, and those who are illegal immigrants.

The FT goes on to report that


"The shift in international trade, investment and communications has required the world's political and economic system to adapt new rules and mechanisms to meet modern realities," said Donald Terry, head of the bank's multilateral investment fund. "The same needs to be done for the migrant labourers who have become such an integral part of the world's labour markets."

An estimated 25m-27m Latin Americans are living and working abroad, 22m of them in the developed markets of North America, Europe and Japan. Migrant workers from the region now made up more than 20% of the labour force in Madrid, Spain's capital. In the US, Latin American and Caribbean workers constitute an average of 12%of the labour force. Family by family, worker by worker, migrants are redrawing the map of global labour markets
Improvements in techniques used to monitor the flows of remittances in part accounted for the sharp rise last year. Many migrants continue to use informal channels, and the total could be more than $59bn.
Countries nearest the US have seen the biggest flows, with Mexico drawing some $20bn of foreign exchange earnings from remittances. The five countries of Central America and the Dominican Republic received $11bn.
Brazil got $6bn, Colombia $4bn and the four other Andean economies a total of $9bn. The bank is continuing its efforts to force down transmission costs of remittances, typically despatched in sums of between $100 and $300. Commission costs now amount to about 5% of the total, less than half the levels of five years ago.

March 26, 2006

Skilled labor immigration into the U.S.: some highlights

A 2004 report on skilled workforces highlights some key trends in skilled immigrants working in the United States. I have excerpted passages on foreign supply of scientists and engineers, the foreign presence among Silicon Valley leaders, and the broad effect of globalization.

The study is titled Preparing Chemists and Chemical Engineers for a Globally Oriented Workforce: A Workshop Report to the Chemical Sciences Roundtable (2004)

I have previously posted on foreign trained physicians in the United States, the U.K., Canada and Australia.

Effects of globalization on the domestic supply of IT workers

If in 1980 the United States had closed its borders and not allowed IT to globalize as it did, there probably would not have been the IT boom enjoyed in the 1990s. The IT industries would not have been able to deliver the productivity gains and price declines that they did.

To summarize, research by economists has concluded that in recent decades globalization appears to have been more beneficial for more-skilled workers in the United States than for less-skilled workers. It also seems that the boom time in real wages since 1995, driven largely by IT, has had a lot to do with globalization. These gains from global integration are widely distributed across skill groups.

Continue reading "Skilled labor immigration into the U.S.: some highlights" »

March 18, 2006

Does immigration depress wages of native Americans?

Two prominent economists each with many years’ experience in immigration research come down on opposite sides of this question:

David Card of UC Berkeley thinks the adverse impact is scant. His most recent paper is titled,” Is the new immigration really so bad?”

George Borjas of Harvard thinks the adverse impact is large –the new eave of immigrants depresses wages by 3 to 4%. He stakes his position out in a paper presented through the Center for Immigration Studies.

I'll use a simple model below to highlight that which researchers have to grapple.

Continue reading "Does immigration depress wages of native Americans?" »

March 4, 2006

Farm workers labor contractor fraud

Four California agriculture contractors accused of labor violations is the title of the article which ran on 1/14/06 in the Fresno Bee. The article summarizes a common theme of employer fraud practiced in the California agricultural counties by labor contractors. These are employers who bring workers to the farm. The farm owners do not know the terms of employment between the contractor and the workers – pay, compliance with state labor laws, etc.

According to the Bee:

The alleged misconduct resulted in an underpayment of about $900,000 in premiums to the State Compensation Insurance Fund and cheated the state out of about $676,000 in payroll taxes, according to a state Department of Insurance statement made public Friday.
The companies are suspected of misrepresenting total payroll, the number of employees and the type of work performed by employees, according to the Insurance Department..
The companies supply workers to farms in Fresno, Madera, Kern, Tulare and San Luis Obispo counties.
More than 100 workers' compensation fraud cases have been investigated in the San Joaquin Valley in the past three years, a marked increase from previous years, said Mark Voss, chief investigator of the Fresno Fraud Division Office of the Insurance Department.

February 25, 2006

New study on economics of rural immigrant workers

Thanks to the Immigration LawProf blog for alerting me to a new study of immigrants in rural areas.

The Urban Institute has come out with a new book on rural poverty in America, and the effect of rural migration by immigrants.

It describes The New Rural Poverty: Agriculture and Immigration in California as follows:

Migrants arrive, many from Mexico, to fill jobs on farms and in farm-related industries, usually at earnings below the poverty. Leaders of rural industries are adamant that a steady influx of foreign workers is necessary for economic survival. But the integration of these newcomers is uneven: many immigrants achieve some measure of the American dream, but others find persistent poverty, overcrowded housing, and crime. The New Rural Poverty examines the effect of rural immigration on inland agricultural areas in California, farm areas in coastal California, and meat and poultry processing centers in Delaware and Iowa. The authors examine the interdependencies between immigrants and agriculture in the United States, explore the policy challenges and options, and assess how current proposals for immigration reform will affect rural America.

The New Rural Poverty: Agriculture and Immigration in California, by Philip Martin, Michael Fix, and J. Edward Taylor, is available from the Urban Institute Press

February 16, 2006

Wall Street Journal article on Brazilian immigrant cleaning business in MA

Today's Wall Street Journal profiles Brazilian home cleaning businesses in MA. The businesses are so well developed that a buy-sell market has emerged; the Internet is used to communicate and clients; and Craig’s list is used to recruit workers. The hub of the cleaning business is in Somerville, MA, which according to the Boston Globe’s analysis of census data, 31% of new immigrants are Portuguese speaking (Brazilian or Portuguese). We have already profiled the Brazilian Immigrant Center.

Tufts University is undertaking a collaborative multi-year project in Somerville to study and support economic growth among immigrants. Included in the project is the introduction of “green” cleaning materials for cleaning businesses.

Among a number of initiatives, this project

.... will also break new ground by launching an entirely new business model for immigrant workers: a non-profit green cleaning cooperative that will help to break down the barrier of isolation faced by these workers. "Brazilian women cleaners form a large occupational group working and living in Somerville who can benefit from this new structure and by learning about safe work practices and the benefits of using environmentally friendly cleaning products," said Monica Chianelli, coordinator, Brazilian Women's Group.
"Immigrants have accounted for 82 percent of the growth of the labor force in Massachusetts since the mid 1980s. Somerville, which has seen the number of foreign-born residents grow by 34 percent in 10 years, is an important gateway for newcomers," explained Principal Investigator David M. Gute, associate professor of civil and environmental engineering at Tufts University and an epidemiologist.

One out of eight new jobs to be filled by immigrants, 2002 - 2012

A new study by the American Immigration Law Foundation estimates that job growth for the foreseeable future is heavily dependent on immigration. Economic Growth and Immigration: Bridging the Demographic Divide, says that:

U.S. economic growth projections for 2002–2012 are predicated on a growing supply of workers that likely will not be found in the native-born population alone. Absent a change in current immigration laws, undocumented immigrants will likely account for 1 in 8 new workers between 2002 and 2012. Rather than creating an orderly process by which needed workers enter the United States from abroad, static limits on employment-based immigration have diverted labor migration to undocumented channels or clogged the family-based immigration system.

February 14, 2006

How immigrants without bank accounts get by

An introduction to “unbanked” workers in America – mainly Mexican – can be found at Financial DNA Weekly, May 14, 2004 According to this report, the Mexican worker in U.S. remits on average $2000 a year to Mexico. Average individual remittance is $300, with transaction fees of $10 to $20. This is a $3.5 billion business growing to $10 billion. This source estimates that only 25% of Mexican workers have a bank account, which presumably supports its $10 billoin forecast.

Another source, in contradiction, estimates that 40% of Latin American in the U.S. do not have a bank account. “A worker earning $12,000 a year could pay $250 for check cashing services” per Banking the Poor: Policies to Bring Low-Income Americans Into the Financial Mainstream, by Michael S. Barr, University of Michigan Law School, Published in The Brookings Institution, Research Brief, pg. 1 (September 2004)

Jopari Solutions, run by insurance professionals, has reportedly proposed to major workers compensation insurers a service to expedite indemnity payments, including to unbanked recipient.

The Financial DNA Weekly report contains the following nuggets:

Continue reading "How immigrants without bank accounts get by" »

February 12, 2006

What day laborers earn by hour, month, year

On the Corner, the recently published nationwide survey of day laborers, reports that 7.4% of work assignments pay $7 per hour or less; 22% between $7 and $9.99; 46% between $10 and $12; and 25%, over $12.

Assignments paying over $12 usually involve high skill work such as electrical or plumbing work.

For total monthly earnings, in a good month the median total income is $1,400. In a bad month the median is $500.

The authors report that even with workers who have more good than bad months, it is unlikely that their total annual wages exceed $15,000.

See a prior posting for the report's analysis of the kind of work days laborers perform and whom they work for.


February 11, 2006

Demand for foreign nurses is intensifying

Foreign nurses are now filling a very high share, perhaps as much as one third, of new hospital based nursing jobs.

Put this in context: One out of every five new jobs created between 2004 and 2014 will be in the healthcare sector. Three of the ten industries with the highest total job additions are in the health care area: practitioner offices, private hospitals, and home health care.

Nursing jobs will grow at a relatively fast rate in the next decade. Foreigners hold currently about 300,000, or 11%, of nursing positions. Nurses from the Philippines make up one third of these workers. Latin American/Caribbean workers are about a quarter. In the past few years hiring of foreign nurses has spurted due to rising demand and limitations on nursing educational slots in the United States. Foreign nurses tend to work for metropolitan area hospitals and, due to more experience, many work in ICUs and are paid relatively well.

Much of this information comes from a presentation by Linda Aiken, professor at the University of Pennsylvania School of Nursing.

For a description of the legal and professional steps in recruiting a foreign nurse, go to this article.

February 10, 2006

H-1B visas and the engineering workforce shortage, per Chair of Intel

Craig Barrett, Chair of Intel, recently wrote a commentary for the Financial Times (payment required) and afterwards responded to reader questions.

Begun in 1998, the H-1B program has annual caps which in 2003 was 195,000. In 2004 the cap was cut to 65,000. As of 2004, close to 1,000,000 H-1B visa holders were believed to be working in the United States, up from about 360,000 in 1998. This means an annual addition of about 150,000 workers a year into the American workforce.

Compare this stream to the supply of engineers coming from American higher education (many of whom are foreigners)? In 2004, there were about 70,000 bachelor, 40,000 master, and 6,000 doctoral degrees were awarded by American colleges and universities. This is from the American Society of Engineering Education

H1B Visa (Professional in a Specialty Occupation) allows a U.S. employer to fill a position requiring the minimum of a baccalaureate in the particular field with a qualified worker from abroad. The foreign worker must possess that U.S. degree or an acceptable foreign alternative. In some cases, a combination of studies and relevant experience may substitute for the degree if it is determined by a credentials expert to qualify the foreign professional. The large majority of H1B visa holders are believed to be engineers.

Per Barrett:

Continue reading "H-1B visas and the engineering workforce shortage, per Chair of Intel" »

February 9, 2006

High future demand for immigrant construction workers

Demand for immigrants in the construction field has been strong since the mid 1990s and will continue to be for several reasons. (1) New and replacement construction will continue to grow, though experts say at a lower rate. (2) Among many construction jobs there is a high turnover rate, and employers have constantly to search for new hires. (3) Demographics will continue to bring construction to areas of the country where there is a high level already of immigrant workers in construction.

In a keynote address at a construction risk management conference on trends and emerging issues, Huge Rice of FMI forecasted high construction activityin the United States, in part due to demographic shifts in age and residential location. Between 2002 and 2012, he forecasted 1.1 million new construction projects involving 1.4 “retirements/defections” and 2.5 million replacements/new entrants. Rice specifically addressed the Hispanic construction workforce. He noted the demographics of the country and the southwest, where Hispanics now make up about a third to a half of all construction labor:

New Mexico 48%
Texas 45%
California 34%
Florida 21%

Total nationwide Hispanic employment in construction rose between 1980 and 2000:

1980 342,000
1990 650,000
1995 782,000
2000 1,408,000

Three quarters of these Hispanic workers are of Mexican descent.

The Federal government addressed construction labor growth in a number of accessible studies, including one in 2002 and a set in the November, 2005 issue of the Monthly Labor Review.

According to the Department of Labor, construction jobs grew at an annual rate of 3.1% between and 2004. DOL expects much slower growth between 2004 and 2014, about 1.1% annually. However, in terms of total jobs added in that period, 792,000, construction will be the fourth largest contributor to job growth (after retail, employment services, food services, and medical offices). Residential construction, where immigrant labor tends to congregate, is expected to grow in dollars by 1.8% . annually. Construction workers make up slightly under 5% of the domestic civilian workforce.

February 2, 2006

Polarization of American labor market

A recent paper has proposed a “polarization” of the American labor market. This trend is directly relevant to how immigrants gain entry into the domestic economy.

Per the authors, work is expanding at the high and low ends with little or no growth in the “routine’ job middle, where the IT revolution (including enabling massive off-shoring) is destroying domestic jobs. The vast majority of immigrants would fit into the lower end of the polarized market. This raises in my mind concerns about what integration into the American economy means for the large majority of immigrants. I conversed by email with David Autor, one of the authors.

Continue reading "Polarization of American labor market" »

January 31, 2006

Mexican Immigrants save Vermont milk industry

Mexican workers are effectively helping to save Vermont’s cherished milk farms. The farms are in danger of being wiped out by competition. Milk production accounts for 80% of the state’s farm output and dairy farms are an icon of Vermont life. Mexican immigrants today account for an estimated on third of milk farm labor in the state. Farmers say that help is otherwise not available.

A recent report by John Dillon on Vermont Public Radio on Mexican workers on Vermont farms revealed how the state is implicitly collaborating with farmers to ensure that undocumented workers are available. It starts with the submission of the Citizenship and Immigration Services’ I-9 form.

According to the story, the Vermont Department of Agriculture advises farmers

To make certain that the documents that are required for the I-9 are there. The employer, the farmer, has no requirement to test the validity of the documents.

It’s kind of like “don’t ask, don’t tell". The news story said that

Federal immigration officials usually leave the farms alone. But workers can get turned in and deported if they get a speeding ticket, or if they're stopped by police for a routine traffic violation…. Agriculture Secretary Steve Kerr says it's common knowledge that the papers many Mexicans carry are fake.

January 30, 2006

Where undocumented immigrants live and work

In January 2004,the Urban Institute published a useful overview of the undocumented population in the United States. Go here for the entire report.

The Institute estimated there were at that time 9.3 million immigrants, of which 6 million were workers. 96% of men work and 62% of women work.

Breakdown of the total population of undocumented immigrants is:

U.S. total (in millions) 9.3; California, 2.4; Texas, 1.1; Florida, 0.9; New York, 0.7; Illinois, 0.4; New Jersey, 0.4; all others, all others, 3.5.

January 29, 2006

Whom day laborers work for, what they do

A snapshot from On the Corner: Day Labor in the United States:

Principal employers of day laborers are (1) contractors in the construction and landscape gardening business and (2) private individuals. Two thirds of day laborers are hired repeatedly by the same employer.

At least three quarters of day laborers have work in most or all of the following occupations: construction labor, mover, gardner/landscaper, and painter. About two thirds have worked as roofers. Other common occupations are house cleaner, carpenter, and drywall installer.

The vast majority –- 83% -- rely on day labor as their sole source of income, and 70% seek work at least five days a week. One third seek work seven days a week.

Go here for a full copy of On The Corner.

How Mexicans in U.S. send money back to Mexico

Money flows from Mexican workers in the United States to Mexico are approaching $20 billion a year. I have excerpted from the Financial Times (subscription required) an article on this topic, describing methods of transmission and surprising ways in which the money once received is used.

Excerpts from the Financial Times, Home towns and US banks grow better at reaping benefit of migrants’ dollars, By John Authers 12/12/05

Take a walk along Broadway in the New York district of Harlem, and you can begin to understand the recent strength of the Mexican peso against the dollar. Now in a largely Hispanic neighbourhood, with a pocket of Mexican migrants from the state of Puebla, Broadway is lined by remittance houses, all advertising in Spanish what they say are cheap rates.

It is a phenomenon repeated in Mexican neighbourhoods across the US. In the past few years, the economic weight of Mexico’s migrant labourers has begun to make itself felt south of the border. The migrants’ dollars help to explain the strength of the peso, and they are also beginning to wreak much more profound social changes at home.

The numbers, as published by the Bank of Mexico, tell an extraordinary story. For the first 10 months of this year, the money sent home to Mexico from the US in family remittances was $16.5bn – only just below the $16.6bn that was sent back during all of 2004. It is also $10bn more than the $6.6bn remitted to Mexico in 2000.

This money was sent mostly in transactions of about $300, and is increasingly sent by electronic transfer, rather than the traditional money orders.

Banxico is careful to state that the rise may not be as sharp as it appears, because its information-gathering has improved. Its earlier figures may therefore have understated the phenomenon.

……….

Migrants now have a greater array of options when they want to send money home. In 2002, many banks in the US decided they would accept consular ID cards, known as the matricula, as proof of identity from migrants wanting to open bank accounts. The cards were available from consulates to all Mexicans, even those working in the US illegally.

City and state municipal authorities across the US were happy to recognise the cards, which could also be used to obtain driving licences. The idea was to regularise or improve the status of undocumented labourers.

The effect of the cards was immediate. Wells Fargo, one of the largest US banks in the areas with high rates of Mexican immigration, reported that 400,000 people used the cards to open accounts with its branches. The cards ushered in competition, with Citigroup, Bank of America and HSBC all also offering remittance services.

Technical improvements have also helped. For example, the Poni card, backed by several patents, is now available in Las Vegas, Phoenix, Tucson and Chicago and will soon spread to areas with higher concentrations of Mexicans such as California, New York and Texas. Migrants can buy Poni cards, which come in various peso denominations and look much like phone cards, in US groceries, and scratch off the foil on the back to reveal a 16-digit PIN number. Armed with that PIN, a Mexican can take one of the 1m Poni cards in circulation south of the border, and use it to withdraw that amount from an ATM. Each PIN can only be used once, and the ATM will respond only to the PIN. The card’s backers believe that its key advantage, compared with a bank account, is that it maintains anonymity. It is also sold the same way as phone cards, which are already popular items among migrants.

……….

There is controversy, however, over the impact of remittances on Mexico, and even whether all the money that shows up in the Bank of Mexico figures really goes to poor families.

Rodolfo Tuiran of Sedesol, the social development ministry, stirred the controversy earlier this year with a paper attacking the notion that remittances had helped to alleviate poverty. According to Sedesol research, if all the remittances were suddenly to stop, the proportion of Mexicans living in poverty would rise only from 47.1 per cent to 48.5 per cent. The proportion of remittance money going to poor families is even falling over time.

“For some people, remittances allow them to buy a basic basket of essential goods,” says Rodolfo Tuiran, of Sedesol, Mexico’s social development ministry. “But overall, in terms of poverty, remittances don’t have a significant impact. They do, however, have an important impact on inequality – they increase it. Of every $100 received, $75 goes to homes that aren’t poor.”

……….

However, remittances are increasingly being channelled to productive uses. Mexicans tend to congregate with people from the same home town, leading to a network of more than 600 home-town associations across the US. Typically, they have been involved in such things as organising trans-national beauty pageants. Now they are being encouraged to pool their remittances.

Several states now have “three-for-one” programmes, where each dollar from the home-town association for a development project is matched by a dollar each from the municipal, state and federal governments.

In Zacatecas, the silver mining state that sends the highest proportion of its people to the US, the effects are dramatic. Towns with a three-for-one scheme are immaculately paved and will often have a well-restored church. Towns that do not have dirt tracks.