The 1 percents immigration con: How big business adds to income inequality, pits workers against each other
With last Novembers elections behind him, President Obama has finally begun making good on promises to defer the deportation of most of the 10 to 12 million undocumented immigrants currently living in the United States. Four to 5 million will be eligible for a formal stay of deportation proceedings for three years, along with green cards granting permission to work. Meanwhile, a presidential order directing law enforcement officials to focus deportation efforts on those facing serious criminal charges will, in practice, grant most remaining undocumented immigrants freedom to remain as well. Political progressives have generally applauded these moves; if anything, we have criticized them for not going far enough in protecting undocumented workers and their families. (A federal judge has blocked those moves; the administration has since asked for a stay of his order.)
What, though, should progressives think about proposals to increase legal immigration into the U.S.? Contrary to common belief, most immigration into the U.S. is legal immigration, currently at congressionally mandated levels of 1.1 million annually (illegal immigration is harder to track, but in recent years it has probably run between 200,000 and 300,000 people per year). Almost as an afterthought, last month the president also announced that his administration would substantially increase visas for tech workers. The comprehensive immigration reform bill passed by the previous, Democratic Senate would have nearly doubled yearly legal immigration levels to approximately 2 million. Such proposals should give serious advocates for American workers pause.
Consider that since 1965, changing policies have increased U.S. immigration numbers from 250,000 to approximately 1.3 million annually (legal and illegal). That is four times higher than any other country on Earth. Crucially, in recent decades immigration has been concentrated among less-skilled, less-educated workers. According to one study, from 1980 to 1995 immigration increased the number of college graduates in the U.S. workforce by 4 percent while increasing the number of workers without a high school diploma by 21 percent.
The upshot has been flooded labor markets for less-skilled workers in the United States, with predictable results. Wages have been driven down. Benefits have been slashed. Employers have been able to break unions, often helped by immigrant replacement workers. Long-term unemployment among poorer Americans has greatly increased. Mass immigration is not the only cause of these trends, but many economists believe it has played an important part in driving them.
Harvards George Borjas, a leading authority on the economic impacts of immigration, contends that during the 1970s and 1980s, each immigration-driven 10 percent increase in the number of workers in a particular economic field in the United States decreased wages in that field by an average of 3.5 percent. More recently, studying the impact of immigration on African-Americans, Borjas and colleagues found that a 10 percent immigrant-induced increase in the supply of a particular skill group reduced the wages of black workers in that group by 4 percent, lowered the employment rate of black men by 3.5 percentage points, and increased the incarceration rate of blacks by almost a percentage point.
Crucially, immigration-driven competition has been strongest among poor and working-class Americans, while wealthier, better-educated workers have mostly been spared strong downward pressure on their incomes. According to an analysis by the Center for Immigration Studies, immigrants account for 35 percent of workers in building cleaning and maintenance, but only 10 percent in the corporate and financial sectors; 24 percent of workers in construction, but only 8 percent of teachers and college professors; 23 percent among food preparation workers, but only 7 percent among lawyers. As the following table shows, high percentages of immigrant workers within an economic sector strongly correlates with high levels of unemployment.
Immigrants occupational share by economic sector in the United States in 2004
Source: Steven Camarota, A Jobless Recovery? Immigrant Gains and Native Losses.
No wonder wealthy Americans and a bipartisan political elite that largely serves their interests typically support high levels of immigration. Doctors, lawyers and Wall Street bankers have done pretty well in recent years in America. Truck drivers, construction workers, backhoe operators and meat-packers? Nurses, secretaries, cleaning women and supermarket checkout clerks? Mechanics, roofers, janitors, waiters, day laborers and garbagemen? Not so well.
In recent decades, mass immigration arguably has harmed poorer workers and increased economic inequality in the United States. But this should not surprise us. By importing millions of poor people into the United States and setting them in competition with other poor people for scarce jobs, we drive down wages and increase unemployment among those who can least afford it. Our current era of gross economic inequality, low wages and persistently high unemployment seems like precisely the wrong time to expand immigration.