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.

The great demographic shift in the American workforce

In the past ten years, the American workforce has been growing in total largely on the strength of increases in foreign born labor. Among the ranks of the employed, foreign-born worker growth’s role has been even more pronounced.
An article in the May 2002 issue of the Monthly Labor Review has data to show the impact of foreign-born labor. The authors reported that for the year 2000, three quarters of the growth in the workforce was from foreign labor. In that year, employment among non foreign-born workers actually declined by 491,000 while employment among foreign-born workers rose by 897,000.
The Bureau of Labor Statistics reported more recently that in 2004 the total number of foriegn-born workforce was about 21.4 million, or 14.5.% of thr total labor force. Slightly under half of the workforce growth between 2002 and 2004 was foreign-born.
Foreign born labor has entered employment rolls in an hour glass fashion: a small absolute number in the highly trained professions, a much larger number and much larger proportional impact in the bottom quarter of jobs as defined by educational requirements.
Between 1996 and 2000, foreign-born labor accounted for 49% of the increase in the workforce. (As the 2000 data above show, this percentage increased in 2000 alone.) For workforce members without a high school diploma, the total number in America declined by 393,000 but the total number of foreign-born workers with less than a high school diploma went up by 654,000. Thus, foreign-born workers were rapidly filling the ranks of the low educated that were being emptied by non-foreign born.
For the occupational category of “operators, fabricators and laborer,” total workforce growth in 1996-2000 was 105,000. However the workforce growth among foreign born was 664,000, indicating that non-foreign born ranks declined while foreign born workers flooded in.

Study asserts H-1B visa program undercuts American computer programmers

The Center for Immigration Studies just released a critique of the H-IB visa program. The core message of the study is that employers use the visa program to hire professional workers at wages well below the actually prevailing wages of comparable workers – despite a statutory prohibition. I have entered below the executive summary of “The Bottom of the Pay Scale: Wages for H-1B Computer Programmers” by John Miano and, following that, a useful primer of the program from his study.
H-1B visas by occupation are computer 28%, education 14%, administrative 13%, engineering 12%, health 9%, managers 8%, all others 18%. Visas by country of origin are mainland India 36%, China 9%, Canada 5%. all others 50%.
Executive Summary
The temporary visa program known as H-1B enables U.S. employers to hire professional-level foreign workers for a period of up to six years. Employers must pay H-1B workers either the same rate as other employees with similar skills and qualifications or the “prevailing wage” for that occupation and location, whichever is higher….The analysis demonstrates that…actual pay rates reported by employers of H-1B workers were significantly lower than those of American workers. ….[R]ather than helping employers meet labor shortages or bring in workers with needed skills, as is often claimed by program users, the H-1B program is instead more often used by employers to import cheaper labor.
Key Findings
On average, applications for H-1B workers in computer occupations were for wages $13,000 less than Americans in the same occupation and state.
Wages on approved Labor Condition Applications (LCAs) for 85% of H-1B workers were for less than the median U.S. wage in the same occupations and state.
Applications for 47% of H-1B computer programming workers were for wages below even the prevailing wage claimed by their employers.
Employers can easily manipulate their need to show that the H-1B worker will be paid a prevailing wage. The Department of Labor is hamstrung in enforcing more rigor into this part of the application process.
Employers making applications for more than 100 H-1B workers had wages averaging $9,000 less than employers of one to 10 H-1B workers.
The report goes on to say that many U.S. employers use “bodyshops” (labor service providers) for H-1B workers, thereby making it easier for the employer to obscure how it may be firing American workers in order to hire H-!B workers. And the report says that any investigation of H-1B abuses must be personally approved by the Secretary of Labor.
A primer of H-1B visa program

Continue reading Study asserts H-1B visa program undercuts American computer programmers

Senate Committee approves McCain bill on March 27

The Washington Post reported that the Senate Judiciary Committee voted 12 to 6 in favor of the McCain bill, which combines a guest worker program, citizenship options, and immigration enforcement. The voting took place under a strict deadline imposed by Senate Majority Leader Bill Frist, and as demonstrations erupted across the country against tough enforcement of immigration laws. The 12 vote majority included 4 Republicans (Specter, Graham, Brownback and DeWine and all 8 Democrats.
The Post described the amended legislation as follows:

The panel’s bill would allow the estimated 11 million illegal immigrants in this country to apply for a work visa after paying back taxes and a penalty. The first three-year visa could be renewed for three more years. After four years, visa holders could apply for green cards and begin moving toward citizenship. An additional 400,000 such visas would be offered each year to workers seeking to enter the country.

Senators also accepted a proposal by Sen. Dianne Feinstein (D-Calif.) that would offer 1.5 million illegal farmworkers a “blue card” visa that would legalize their status. The committee also accepted a provision by Sen. Richard J. Durbin (D-Ill.) that would shield humanitarian organizations from prosecution for providing more than simple emergency aid to illegal immigrants, rejecting an amendment by Sen. John Cornyn (R-Tex.) to require humanitarian groups providing food, medical aid and advice to illegal immigrants to register with the Department of Homeland Security.

The Post described popular demonstrations:

At least 14,000 students stormed out of schools in Southern California and elsewhere yesterday, waving flags and chanting to protest congressional actions. About 100 demonstrators, including members of the clergy, appeared at the Capitol yesterday in handcuffs to object to provisions in the House bill that would make illegal immigrants into felons and criminalize humanitarian groups that feed and house them. More than a half-million marchers protested in Los Angeles on Saturday, following protests in Phoenix, Milwaukee and Philadelphia.

ICE no longer to impersonate OSHA personnel


Hazards Magazine has reports that Immigration Customs and Enforcement (within Homeland Security) has reversed its controversial policy. Per Hazards:

On February 16, AIHA [American Industrial Hygiene Association] sent a letter to the Department of Homeland Security opposing word that the Immigration and Customs Enforcement Bureau would continue posing as OSHA personnel to conduct immigrant workforce enforcement. AIHA’s letter went on to say that while we understood the need for illegal immigrant enforcement, using OSHA personnel to conduct “sting” operations was not the way to go, and would undoubtedly result in making it much more difficult to improve the health and safety of immigrant workers.

Last week, AIHA received a letter (dated March 17) from the Director of the US Immigration and Customs Enforcement, Marcy Forman. Ms Forman stated “Effective immediately, the use of ruses involving health and safety programs administered by a private entity or a federal, state, or local government agency (such as the Occupational Safety and Health Administration) for the purpose of immigration worksite enforcement, will be discontinued by ICE”.

This from a press release issued by Aaron K Trippler, Director Government Affairs, American Industrial Hygiene Association, Fairfax VA.

Paul Krugman on immigration reform

The New York Times columnist and economist Paul Krugram, expresses today deep his caution on immigration reform and a guest worker program. In “North of the Border,” he writes that a guest worker program will likely have the effect of creating a formal sub-class of non-voting workers. Repeating some content some of my prior postings, Krugman writes:

First, the net benefits to the U.S. economy from immigration, aside from the large gains to the immigrants themselves, are small. Realistic estimates suggest that immigration since 1980 has raised the total income of native-born Americans by no more than a fraction of 1 percent.

Second, while immigration may have raised overall income slightly, many of the worst-off native-born Americans are hurt by immigration — especially immigration from Mexico. Because Mexican immigrants have much less education than the average U.S. worker, they increase the supply of less-skilled labor, driving down the wages of the worst-paid Americans. The most authoritative recent study of this effect, by George Borjas and Lawrence Katz of Harvard, estimates that U.S. high school dropouts would earn as much as 8 percent more if it weren’t for Mexican immigration.

Krugman ends with these comments about Bush’s guest worker plan:

Meanwhile, Mr. Bush’s plan for a “guest worker” program is clearly designed by and for corporate interests, who’d love to have a low-wage work force that couldn’t vote. Not only is it deeply un-American; it does nothing to reduce the adverse effect of immigration on wages. And because guest workers would face the prospect of deportation after a few years, they would have no incentive to become integrated into our society.

What about a guest-worker program that includes a clearer route to citizenship? I’d still be careful. Whatever the bill’s intentions, it could all too easily end up having the same effect as the Bush plan in practice — that is, it could create a permanent underclass of disenfranchised workers.

We need to do something about immigration, and soon. But I’d rather see Congress fail to agree on anything this year than have it rush into ill-considered legislation that betrays our moral and democratic principles.

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

Legal and illegal immigration survey results

CT-based Quinnipiac University conducted in February a poll on attitudes about public policy options for legal and illegal immigration. Legal immigration has become more popular: 59% opposed more immigration in 2002, but only 38% in 2006.
Overall results
39% want to reduce current levels of legal immigration, with 24% want increased levels and 33% say maintain current levels. Some 57% say that illegal immigration is a “very serious” problem, 31% say “somewhat serious.”
Immigration: split between red and blue states:
In red states (Bush won by at least 5%) were 42% want to reduce [legal?] immigration. In blue states voters (Kerry won by at least 5% ) were 35% – 36% on the immigration question.
On illegal immigration:
62 – 32% opposed to making it easier for illegal immigrants to become citizens; 54 – 41% opposed to making it easier for illegal immigrants to become legal workers. 50 – 42% opposed to eliminating the automatic U.S. citizenship for illegal immigrants’ children born in the U.S.

Immigration bill debate heats up in Washington; filibuster threatened

Both the Washington Post and the New York Times had front page articles today in the immigration debate in Congress. A bush proposal for a guest worker program is still very much alive; so are proposals from McCain, Specter and Frist. The McCain and Specter bills have guest worker provisions; the Frist bill is focused on closing the Mexican-U.S. border to illegal workers, which are now 7.5 million in number.
Rep. Jim Kolbe (R-Ariz.) said to the Associated Press, “Rarely have I seen an issue that divides people so clearly, with so little possibility of seeking a middle ground.” The article printed in the Washington Post refers to the illegal immigrant debate as “an early battle of the 2008 presidential campaign, as his would-be White House successors jockey for position ahead of next week’s immigration showdown in the Senate…. Sen. Johnny Isakson (R-Ga.) announced that he will not accept [a guest worker] program until “we have proven without a doubt that our borders are sealed and secure. At the same time, Senate Minority Leader Harry M. Reid (D-Nev.) promised this week to filibuster Frist’s enforcement-only bill.”
The New York Times, also today, says that Bush said Thursday that his message is: ”If you are doing a job that Americans won’t do, you’re welcome here for a period of time to do that job”… “The president is working hand-in-hand with employers who want cheap labor to clean hotel rooms, pick crops and do other tasks that they say keep their businesses competitive. Senate Majority Leader Bill Frist, R-Tenn., says he understands those economic issues, but his focus is on the main concern voiced by the social conservatives — national security.
”The most important thing is that we keep our borders safe, we keep America safe,” said Frist spokeswoman Amy Call. ”It’s obvious there are drugs, there are criminals coming through those borders. There are also people from known terrorist organizations coming through those borders.”
The Times article goes on: Three-quarters of respondents to a Time magazine poll in January said the United States is not doing enough to keep illegal immigrants from entering the country. Roughly the same amount said they favor a guest worker program for illegal immigrants, but 46% said those workers should have to return first to their native countries and apply. About 50% favored deporting all illegal immigrants.”

Washington Post columnist: “We don’t need guest workers”

Robert Samuelson in the 3/22/06 edition of the Washington Post argues that a guest worker program will lock more poor workers into the American economy, taking jobs away from Americans and disincenting employers from making labor saving improvements. He cites as an example the California tomato industry as one which innovated after cheap labor Mexican labor dried up. Two comments: 1. A guest worker program such as the McCain or Specter bill will increase the cost of immigrant labor, thus to some extent rebalancing the labor costs which Samuelson sees as having gone askew. 2. He does not address what we do with today’s 7.5 million undocumented workers.
Below are some excerpts.

Economist Philip Martin of the University of California likes to tell a story about the state’s tomato industry. In the early 1960s, growers relied on seasonal Mexican laborers, brought in under the government’s “bracero” program. The Mexicans picked the tomatoes that were then processed into ketchup and other products. In 1964 Congress killed the program despite growers’ warnings that its abolition would doom their industry. What happened? Well, plant scientists developed oblong tomatoes that could be harvested by machine. Since then, California’s tomato output has risen fivefold.

We’d be importing poverty. Since 1980 the number of Hispanics with incomes below the government’s poverty line (about $19,300 in 2004 for a family of four) has risen 162 percent. What we have now — and would with guest workers — is a conscious policy of creating poverty in the United States while relieving it in Mexico.

It’s a myth that the U.S. economy “needs” more poor immigrants. They’re drawn here by wage differences, not labor “shortages.” In 2004, the median hourly wage in Mexico was $1.86, compared with $9 for Mexicans working in the United States, said Rakesh Kochhar of Pew. With high labor turnover in the jobs they take, most new illegal immigrants can get work by accepting wages slightly below prevailing levels.

Hardly anyone thinks that most illegal immigrants will leave. But what would happen if new illegal immigration stopped and wasn’t replaced by guest workers? Well, some employers would raise wages to attract U.S. workers. Facing greater labor costs, some industries would — like the tomato growers in the 1960s — find ways to minimize those costs. As to the rest, what’s wrong with higher wages for the poorest workers? From 1994 to 2004, the wages of high school dropouts rose only 2.3 percent (after inflation) compared with 11.9 percent for college graduates.

Business organizations understandably support guest worker programs. They like cheap labor and ignore the social consequences. What’s more perplexing is why liberals, staunch opponents of poverty and inequality, support a program that worsens poverty and inequality. We’ve never tried a policy of real barriers and strict enforcement against companies that hire illegal immigrants. Until that’s shown to be ineffective, we shouldn’t adopt guest worker programs that don’t solve serious social problems — but add to them.