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.

New York Times editorial on immigration reform.

A New York Times editorial, “They Are America,” is trying to shake the country into paying attention to what was going to be a major legislative thrust this year: immigration reform. At least, that seemed probably before Iraq fell apart. This editorial goes down a long list of small and large missteps and outrages upon immigrants, from fence-bulding and factory raids by ICE to DNA testing. the authors stop short of describing what precisely they want in immigration reform, beyond management remedies to some practicef of the Bush Administration.
The entire editorial is below.

Continue reading New York Times editorial on immigration reform.

Skilled foreign workers – summary statistics

Now waves of immigrants are mostly not skilled workers. But foreign born workers have a huge share of some skilled job categories.
Thanks to Immigrant Voice for bringing to my attention these figures.
Skilled workers are a small minority of U.S. legal immigrants. Of the 940,000 legal immigrants recorded in 2004, only 16% were skilled employment-based immigrants. This means that 150,000 of the almost one million new legal immigrants (permanent or temporary) came on a skilled based authorization. About 40% of these skilled immigrants had advanced degrees, or 5 or more years of experience after a baccalaureate degree.
Per Immigrant Voice, the impact of these workers’ contributions to American competitiveness belies their small number, because they make up a large share of all workers in certain professions.
In 1996 17% of all scientists and engineers were foreign born. That rose to 24% in 2002. Among scientists and engineers with PhDs or professional degrees, 38% were foreign born in 1996 and 43% in 2002.
Go to Chpter 2, page 57 of the 2006 Economic Report of the President for more information.

Essential Worker Immigration Coalition: Reform platform

This lobbying group / business association is gearing up for immigration reform this year. It wants more immigrant workers, the more legal the better.
Here is its platform for reform:
Reform should be comprehensive: addressing both future economic needs for future workers and undocumented workers already in the United States.
Reform should strengthen national security by providing for the screening of foreign workers and creating a disincentive for illegal immigration.
Reform should strengthen the rule of law by establishing clear, sensible immigration laws that are efficiently and vigorously enforced.
Reform should create an immigration system that functions efficiently for employers, workers, and government agencies.
Reform should create a program that allows hard working, tax paying undocumented workers to earn legal status.
Reform should ensure that U.S. workers are not displaced by foreign workers.
Reform should ensure that all workers enjoy the same labor law protections.
The policy platform goes on….

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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.

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.

Human trafficking suit in CT

The Associated Press today reported a federal suit by Guatamalan workers in Connecticut alleging a nursery engaged in human trafficking. The suit goes after both the nursery, Imperial Nurseries, and the labor contractor. If the suit is half true, it’s still 100% awful. Yale Law School students helped to prepare the suit. The labor contractor, who appears to have been fired some time ago by the nursery, seems to agree with the suit but denies it know anything about it.
Story follows:

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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.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%

Mexican Government guide for illegally entering the U.S.

I am just now getting around to posting this guide, here in English translation, and available in original comic book format here.
Guide for the Mexican Migrant
Distributed by the Mexican Ministry of Foreign Relations
INTRODUCTION
Esteemed Countryman:
The purpose of this guide is to provide you with practical advice that may prove useful to you in case you have made the difficult decision to search for employment opportunities outside of your country.
The sure way to enter another country is by getting your passport from the Ministry of Foreign Affairs, and the visa, which you may apply for at the embassy or consulate of the country you wish to travel to.
However, in practice we see many Mexicans who try to cross the Northern Border without the necessary documents, through high risk zones that involve grave dangers, particularly in desert areas or rivers with strong, and not always obvious, currents.
Reading this guide will make you aware of some basic questions about the legal consequences of your stay in the United States of America without the appropriate migratory documents, as well as about the rights you have in that country, once you are there, independent of your migratory status.
Keep in mind always that there exist legal mechanisms to enter the United States of America legally.
In any case, if you encounter problems or run into difficulties, remember that Mexico has 45 consulates in that country whose locations you can find listed in this publication.
Familiarize yourself with the closest consulate and make use of it.
DANGERS IN CROSSING HIGH RISK ZONES

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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.