Archive for the ‘Economics’ Category

Choking off immigration to Texas

Monday, October 21st, 2019

Dallas News columnist Rob Curran writes, “You don’t need a degree from the London School of Economics to know that almost every roofer and framer responsible for the heavy lifting in the North Texas building boom of the last decade was an immigrant. You don’t need to be an agronomist to know that pretty much every watermelon you buy in Central Market was harvested by a migrant laborer.

North Texans are among the biggest beneficiaries from this sweat subsidy. People have flocked to this region because a high standard of living comes at a relatively low cost. But middle-class Texans may not always be able to afford a maid, a lawn guy and a regular breakfast taco.

I spoke to one landscaper in North Texas who did not wish to be named. He employed a group of about seven Mexican-born laborers for 10 years. He periodically paid immigration lawyers to have their paperwork renewed — an expensive, but viable proposition. In 2017, the landscaper’s crew returned to Mexico, as usual, but the lawyers could not get them back in. After some pricey back-and-forth with immigration authorities, the landscaper was told that his crew had renewed their visas too many times.”

Latinos in America Today: economics

Thursday, October 17th, 2019

More from the Latin Donor Collaborative report, today about economics:

Latinos are significantly more likely to be actively working or seeking work than non-Latinos. The U.S. Latino labor force participation (LFP) is 67.4 percent, five percentage points higher than non-Latino. Despite being only 18 percent of the U.S. population, Latinos are responsible for 82 percent of the growth of the U.S. labor force since the Financial Crisis.

Whereas the U.S. has average income growth of. just 4.7 percent over the past five years, income growth for Latinos has averaged 8.6 percent. U.S. Latinos enjoyed income growth of 14 percent in 2018.

Home-owning: Beginning in 2013, Latino growth of home ownership accelerated rapidly and grew by seven percent in 2017 alone. Meanwhile non-Latinos saw declining rates of homeownership from the earliest days of the financial crisis all the way through 2014. Although home ownership among non Latinos has begun to grow again, growth has remained belowtwo percent from 2015 to 2017.

However, home ownership among non-White Latinos has persistently been lower than Whites and Non-Latino other (from here)

Also, Latinos are far less wealthy than Whites: (from here):

Latinos in America Today: demographics

Wednesday, October 9th, 2019

I will report in this and a following posting on historical changes in the Latino community in the U.S

A report from the Latino Donor Foundation estimates that if the US Latino population were considered an independent economy it would rank as the eighth largest economy in the world. The report also says that that U.S. Latinos account for nearly 30% of America’s growth in real income and from 2010 through 2017 U.S. Latino consumption grew 72% faster than non-Latinos US Latinos have comprise 87% of workforce growth since 2008.

Demographics: the report sets the Latino population at 58.7 million or 18% of total U.S. population. Annual Latino population growth was 2.0% in 2017 and has been above 2.0% for every recent year. Non-Latino population growth has been below 0.5% in each year from 2011 to 2018.

According to projections by the Census Bureau, by 2060, Latinos will have contributed 30 million people to the population of working age adults (age 18 to 64). In that same time, the population of non-Latino working age adults will have shrunk by one million.

This graph compares the age distribution of Latinos with non-Latinos.

Household formation: Growth in the number of Latino households from 2010-17 was extremely high, at 19 percent. For Non-Latinos, it was just three percent. Latino share of total households shot up from 11.6% to 13.2%

Education: although Latinos still lag behind non-Latinos in formal education (more less likely to complete HS or to get an BA) the improvement in educational achievement among 20-24 year olds between 2010 and 2017 is striking:

 

Eastern European countries quietly recruiting guest workers

Monday, October 7th, 2019

South Korea’s Hankook Tire this month delayed a $295 million investment at its factory in Hungary because of difficulties in recruiting employees. About 200 of its existing 3,000 workers at the plant are from Ukraine and Mongolia.

The labor force of the 21 countries between the Baltic Sea and the Balkans will shrink by more than a quarter by 2050. Deputy Managing Director Tao Zhang told central bankers from the region in July that their countries must start importing workers to help address the issue. It’s already happening.

In Hungary, the EU’s fastest-growing economy, there were 49,500 work permits held by non-EU citizens in 2018, more than double the previous year’s figure. In 2016, there were about 7,300. While Ukrainians held more than half of them, Vietnamese, Indians and Mongolians are now among the groups growing quickest.

Romania boosted the number of permits for non-EU workers by 50% this year, with Sri Lankans and Indians joining Chinese and Turkish employees at restaurants and construction sites. In Poland, crews of Mongolian women paint newly built Warsaw apartment buildings.

In Belgrade, ethnic Albanians are working alongside locals to turn the Serbian government’s vision for a swanky new waterfront complex into reality. On a recent visit, President Aleksandar Vucic expressed amazement at how economic need was trumping a history of ethnic tensions.

From Europe’s Anti-Immigrant Leaders Have a Secret Hungary, Poland, and Serbia are among countries quietly importing workers to cope with a labor crisis, September 24, 2019.

EB-5 program to be drastically revised

Thursday, September 12th, 2019

The Trump administration is revamping the Green Card program for wealthy foreign investors that benefited developers such as Trump and his son-in-law, Jared Kushner. A new final rule, effective Nov. 21 will nearly double the minimum amount of cash required to secure an EB-5 investor visa from $500,000 to $900,000 for projects in needy areas. It will also revise the standards for what is considered a blighted or high-unemployment neighborhood, to prevent developers from “gerrymandering” their own boundaries to attract investments for projects located in affluent communities.

The standard investment threshold for projects in non-needy areas will increase from $1 million to $1.8 million. The amount will automatically adjust for inflation every five years. From here.

The EB-5 program was created in 1990 to encourage investment in economically distressed areas. Foreigners only really started using it in 2008, when turmoil in American capital markets caused real estate developers to scramble for other ways to raise money. It now generates more than $5 billion a year, in exchange for nearly 10,000 green cards — a number that is capped by statute. Chinese applicants take up almost all of the 10,000 spots. From here.

 

Ukraine’s remittance economy

Tuesday, September 3rd, 2019

Ukraine is Europe’s biggest recipient of remittances in proportion to the size of its economy. More than 11 per cent of Ukraine’s gross domestic product comes from remittances and its 5m-strong workforce abroad last year sent home a record $14.4bn through wire transfers and cash carried across the border.

Between 1m and 2m Ukrainians work in Poland, drawn by a combination of linguistic ties, geographical convenience, higher wages and better economic prospects. Salaries are three times higher than back home, and gaps left by young Poles heading to western Europe have caused labour shortages.

The lion’s share of these workers are from Ukraine’s western regions around Lviv, the 1m-strong provincial capital an hour’s drive from Poland where there is a two-decade-long tradition of working both seasonal and long-term jobs across the border, from construction to vegetable picking.

A widespread distrust of local banks means that workers abroad are pouring their cash into other assets, particularly real estate. As a result high-rise apartment complexes are sprouting up around Lviv and property developers say migrant labourers are some of their biggest customers.

From the Financial Times

Dairy workers: at least half are immigrants

Wednesday, August 14th, 2019

 

From 2017 interviews in Spanish with dairy workers throughout New York State: 90% are men, 61% from Mexico, 34% Guatemala, 2% Honduras, 2% Puerto Rico; 93% are undocumented; 73% speak little to no English; 62% are married; 70% have children.

Two-thirds had sustained a work injury; more than 80% were estimated to live and work on farms with too few workers to fall under OSHA’s jurisdiction for inspection and sanctioning (that is, below 11 non-family workers). Typically paid $9 an hour; 97% live in on-farm housing provided by their employers.

New York is a major dairy state. In 2015, it ranked fourth nationally in terms of milk production.

A national survey, done in late 2014, reports much less dependence on immigrant workers but shows better the impact of immigrant workers on the entire dairy industry. It reports that immigrant labor accounts for 51% of all dairy labor, and dairies that employ immigrant labor produce 79% of the U.S. milk supply. Dairy farm workers are paid an average wage of $11.54/hour. Dairy farms employed an estimated 150,418 workers in 2013. An estimated 76,968 of those are immigrants.

A bill was introduced in March, 2019 to expand the current H-2A visa program to allow for its use by dairy farmers. Under current law, dairy workers are not allowed to utilize H-2A visas because the dairy industry is not considered seasonal. The bill would allow for an initial three-year visa with an option to extend for another three years.

Revisiting the hourglass of immigrant workers

Saturday, July 27th, 2019

 

Here are charts which succinctly describe how immigrant workers form an hourglass: greater variance in education and in compensation.

The first chart shows the distribution of education status, comparing immigrants with native-born workers. Immigrant educational achievement concentrates at the extremes.  The very high less than HS share among immigrants are primarily Hispanic.  Recent inflows from Latin America have been more formally educated.

The second chart compares average wages by education status. Immigrants earn less except among college-educated where they are paid more.

Source: BLS for 2018

Spotlight on migration to the Persian Gulf States

Wednesday, July 24th, 2019

The economies of Persian Gulf countries expanded between 2005 and 2015. This encouraged millions of migrants to move to the Middle East. Overall, the number of non-displaced, international migrants living in the Middle East grew by 61% between 2005 and 2015, from about 19 to 31 million. Sources of worker include Bangladesh, Ethiopia, India, Pakistan, the Philippines, and Yemen. Two thirds of these migrants are in Saudi Arabia and the United Arab Emirates (source).

The Gulf countries use the “kafala” system of employing migrant workers. The kafala system binds these migrant workers in a direct relationship with their private sponsoring recruiters or employers to a particular job for a specific period of time. The system codifies the centrality of sponsors, as workers cannot change their employment or leave the country without approval.

The United Nations in 2014 told Qatar the kafala system led to dangerous working conditions and exploitation. Hundreds of foreign workers have died in the massive construction buildup underway for the 2022 World Cup, with estimates that as many as 4,000 workplace deaths could occur. In 2015, Qatar had 1.7 million migrant workers, up from 600K in 2005.

In late 2018 Qatar passed an act which allows some migrant workers to leave; Human Rights Watch criticized it.

Most recently, as their economies have cooled, Gulf countries have been expelling migrants. This has impacted the flow of remittances back to source countries.

Recent Mexican immigrants more likely to be college educated

Friday, July 12th, 2019

The share of Mexican immigrants with a college degree has increased in Texas. There are 145,000 persons from Mexico in Texas with a college degree. 45% of them are naturalized citizens. That’s 8% of the Mexican born population of the state, or 2.2 million.

Today almost one in five recent (since 2013) Mexican immigrants living in the state has a college degree versus 7% in 2000. This mirrors a nationwide trend that is increasing the level of educational attainment among recent Mexican and other immigrants. Temporary visa holders (ie business related) from Mexico are about 55% college educated.

Mexicans in Texas with a college degree tend to work in primary and secondary education and in construction.

There appear to be several factors driving these trends. First, educational attainment in Mexico has increased significantly. Another likely factor is rising violence in Mexico which reached historically high rates in 2017. This may be driving Mexican professionals to move to United States mostly living in border city such as McAllen and El Paso as well as nearby cities such as San Antonio

Finally many Mexican companies have made major investments in the US presence in the past decade, bringing senior executives and key personnel with them. Texas has led the way as a major destination in America for Mexican business investment.

However, 40% of Mexicans in the United States with a college degree have low English proficiency. This contrasts with the roughly 10% of college educated immigrants from other countries with low English proficiency.

From here.