Restricting Immigration Does Not Lead To More Jobs For Americans
The fundamental premise at the heart of the immigration bill that President Trump backed earlier this month has no merit whatsoever.
Earlier this month, President Trump came out in support of a bill sponsored by two Republican Senators that would significantly cut back on legal immigration to the United States, including both immigration by low-skilled workers and by potential immigration considered highly-skilled. At the time he announced his support for the measure, Trump claimed that restricting this type of immigration would result in more jobs available for American citizens. Not surprisingly, there’s no economic evidence to believe this is true, and considerable evidence that restricting immigration could actually end up hurting the economy and the job prospects of Americans at all levels of the economy:
WASHINGTON — When the federal government banned the use of farmworkers from Mexico in 1964, California’s tomato growers did not enlist Americans to harvest the fragile crop. They replaced the lost workers with tomato-picking machines.
The Trump administration on Wednesday embraced a proposal to sharply reduce legal immigration, which it said would preserve jobs and lead to higher wages — the same argument advanced by the Kennedy and Johnson administrations half a century ago.
But economists say the tomato story and a host of related evidence show that there is no clear connection between less immigration and more jobs for Americans. Rather, the prevailing view among economists is that immigration increases economic growth, improving the lives of the immigrants and the lives of the people who are already here.
“The average American worker is more likely to lose than to gain from immigration restrictions,” said Giovanni Peri, an economist at the University of California, Davis.
The Trump administration is proposing sharp reductions in the number of skilled and unskilled workers who are allowed to become permanent residents, halving annual immigration from the current level of roughly one million people a year.
“This legislation demonstrates our compassion for struggling American families who deserve an immigration system that puts their needs first,” President Trump said.
Economists say that skilled immigrant workers are clearly good for the American economy. The United States could import computers; if it instead imports computer engineers, the money they earn is taxed and spent in the United States. Moreover, some of those engineers invent new products — or even entirely new technologies.
The administration says it still wants high-skilled workers, and it has described the cuts as targeted at low-skilled immigrants. It would still issue roughly 140,000 merit-based green cards each year, while sharply reducing the number of people admitted as family members of current residents.
But about one-third of those family members who received green cards since 2000 had college degrees, Mr. Peri said. “People have an outdated image” of legal immigration, he said. “It’s mostly Asian, Indian, Chinese people who are coming to do mid- and high-level professional jobs.”
George J. Borjas, the Harvard immigration economist whose work is the only evidence that the administration has cited as justifying its proposals, said in an interview on Wednesday that there was no economic justification for reducing skilled immigration.
“That is a political decision,” he said. “That is not an economic decision.”
With regard to unskilled and low-skilled immigration, the debate among economists is a bit more pointed, but the consensus view is that low and unskilled immigration does not unduly restrict the ability of Americans in a similar position to obtain employment:
Mr. Borjas also argues that low-skilled immigration does not produce clear benefits for the economy as a whole. He said that the benefit of low-cost labor was offset, or even slightly outweighed, by the cost of providing government services to immigrants.
The primary beneficiary of immigration is the immigrant, Mr. Borjas said.
“If all you care about is economics, then it’s really clear,” he said. “But do you want to live in a country that only cares about money, or do you want to live in a country that has a legacy of being generous to immigrants? Maybe you want a compromise.”
Other economists, however, have sharply disputed Mr. Borjas’s research. Most studies put the negative impact on low-skilled wages closer to zero, Mr. Peri said.
One key reason is that immigrants often work in jobs that exist only because of the availability of cheap labor. Picking tomatoes is a good example. California farmers in the 1950s and early ’60s relied on Mexican workers even though machines were already available. In 1964, 97 percent of California tomatoes were picked by hand.
The United States let farmers hire Mexican workers on seasonal permits, a program that began as a response to labor shortages during World War II. By the early 1960s, the program was politically untenable. “It is adversely affecting the wages, working conditions, and employment opportunities of our own agricultural workers,” President John F. Kennedy declared in 1962. President Lyndon B. Johnson ended the program in 1964.
By 1966, 90 percent of California tomatoes were being picked by machines.
“The story that ‘when labor supplies go down, wages go up’ is a cartoon,” said Michael A. Clemens, an economist at the Center for Global Development who has studied the end of the Mexican guest-worker program, which was known as the Bracero program.
Similarly, in the present day, some American dairy farmers warn that the nation needs to continue importing farm workers or it will end up importing milk.
Low-skilled immigration can also provide a boost to the rest of the economy.
A 2011 study found that high-skilled women were more likely to work in cities with high levels of immigrants, because families could pay for child care or elder care.
The National Academy of Sciences made an ambitious effort to assess the bottom line in 2016. It concluded that the average immigrant cost state and local governments about $1,600 a year from 2011 to 2013 — but the children and grandchildren of immigrants paid far more in taxes than they consumed in public services.
More broadly, the report concluded that immigration benefited the economy.
When he endorsed the measure introduced by Senators Tom Cotton of Arkansas and David Perdue of George, President Trump made the claim that our current immigration system, which provides preferences to immigration based on family connection to citizens and people who are already here legally results in wages for low-skilled American workers being pushed down due to increased competition. This is, of course, another variation on the old and rather easily disproven idea immigrants take jobs away from American citizens. This argument is deeply flawed for a number of reasons. First of all, as a matter of principle, it’s simply false to claim that anyone is entitled to a job or that American citizens should be more entitled to a job than an immigrant who is willing to do the job for a lower wage. Second, as the links in the quoted text above and other studies have shown, low-skilled immigrants in particular end up in the kind of labor intensive low-wage jobs that most Americans would decline to do regardless of how much they were being paid. This includes positions such as landscape laborers, dishwashers and other workers in restaurants, and positions in construction that require only a minimal level of skill. For example, when states such as Georgia and Alabama passed laws intended to crack down on “illegal immigration” earlier in this decade, farmers quickly found it far more difficult to find people to pick the vegetables and other crops in their fields no matter how much they offered for the job. The result was that crops ended up rotting unpicked in the field and local economies were adversely impacted as a result.
Rather than depressing the labor market, both economic studies and our own history demonstrate that increased immigration actually ends up benefiting the economy as a whole, including job growth that benefits American citizens. The reasons for this are, of course, easy to understand. In addition to working in positions that ordinary Americans loathe to take at any price, both legal and illegal immigrants also contribute to the economy by their sheer interaction with it. Just like anyone else in the country, these people spend the money they earn on goods and services for themselves and the families that stimulates economic growth as a whole, which in turns helps to create the kind of economic activity that helps increase employment across the board. This has been the case throughout American history, and those occasions when we have restricted immigration have shown that the economy as a whole ends up suffering. By restricting immigration, therefore, Trump, Cotton, and Perdue would quite likely end up harming the average American far more than they would be helped by the fact that there was supposedly less competition in the labor market.