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Greg Siskind on Immigration Law and Policy

US UNEMPLOYMENT RATE STILL SHOWS FULL EMPLOYMENT

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Why am I blogging about this subject? Because one of the most common arguments made by anti-immigrants is that immigrants are taking jobs from Americans. Economists accept that 0% unemployment is impossible since the market is not perfect and people don't have the ability to instantly identify suitable employment even if jobs are available. They also accept that an unemployment rate that is too low is dangerous for an economy because a severe worker shortage can drive inflation.



Economists look for a "sweet spot" called a NAIRU - the non-accelerating inflation rate of employment. This is essentially the measure of full employment in an economy. Unemployment greater than this number means too many people are suffering and the economy is probably in or heading in to recession. Unemployment lower than that number means you risk setting off inflation.




Right now the US is on the inflation side of the equation. According to the Organization for Economic Cooperation and Development, the NAIRU for the United States is 5.2%. This morning the US government released September's unemployment rate showing that despite fears of an economic slowdown, unemployment is still at a healthy 4.7%, up just one-tenth of a percent over last month and below what economists were expecting. Unemployment in the professions, including IT, health care and education is significantly below the national unemployment rate, by the way. And the unemployment rate in the US is one of the lowest in the developed world.



So when you hear complaints about people being displaced by foreign workers, remember the big picture. Certain folks with a vested interested in keeping workers in their field in short supply (and who could care less about inflation or other collateral damage caused by artificially preserving this shortage of workers) keep pushing this myth. They'll try and tell you that the numbers lie. Don't believe them.

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  1. 's Avatar
    They are employed...they just wanted higher salary....so they blame the immigrants for taking their works (outside the normal 40 hour week)....it could extra overtime for them....

    But would they toil the farm after 8 hours of working as a bank clerk? I don't think so...
  2. Another voice's Avatar
    This counter the common argument of the anti-agenda o round them up and send them back. There are not 12 million people arround to take on those jobs not even if people get loads of OT.
  3. Another voice's Avatar
    Looks like the antis found an ally in Georgia!!!

    http://gacriminallawblog.com/2007/07/29/cobb-county-jail-clamps-down-on-illegal-aliens/
  4. EB's Avatar
    Another voice, I want to debate this. I agree, there are just not enough Americans around to take on those jobs. When I read this post, I realized that the US needs the service of the undocumented workers, This is now a human-rights issue. These people are coming in from a very poor country and need to make money to survive. The US needs their service, yet will not ackowledge this and will not issue them visas. This is a modern-day form of slavery. For all intents and purposes, these people are "economic immigrants" and they deserve visas and the right to live outside shadows. End slavery!
  5. Another Voice's Avatar
    EB what is there to debate I could not agree with you more.
  6. Legal and waiting's Avatar
    EB, having an epiphany? Yeah, it's kind of like that... This country pretty much can't survive without the undocumented, and yet, it would not give them any status. Now you understand why the whole 'reward the lawbreakers' routine is a bunch of thoroughbred manure. Unfortunately, it sounds so inticing that many citizens and, sadly, legal immigrants bought into it.
  7. EB's Avatar
    Where are the economists? Why are they not saying anything about it? Where are the human rights activists? What about decent Americans? Legal and waiting, why does your name stress that you are legal It is going to be hard to get legal immigrants to understand this, and even if they understand they might not care to do anything about it. At various points in time, when bills have allowed the undocumented to apply for AOS, this has resulted in backlogs for legal immigrants.
  8. Another voice's Avatar
    EB undocumented workers do not get help from anyone on their situation. They definetly do not need legal immigrants to gang up on them too they got their plate full already. Unfortunatly they could not come here through the lagal path that was available to other immigrants and they pay a high price for that. These people need help and no one is willing to give it to them not even if they pay stiff fines, go back home, write santa claus and write a million times I will never do this again.
  9. Legal and waiting's Avatar
    EB, economists do not distinguish between legal and illegal immigration - to them, it is about contributing labor to the economy, nothing more. There is no shortage of studies that show that immigration is positive for the economy, but this topic is not that interesting for economists, since it is a little too simple and straightforward (yeah, more people is a jet fuel of the economy because it moves the restrictive line for GDP in macro models up - that's exactly how economists think of labor, just a variable in the model). There is also the question about impact on wages, that appeared to have hijacked the research agenda, mostly because it is more difficult, and thus interesting, question to study. Borjas was the one arguing a moderate negative impact on some groups, but after all sorts of corrections and improvements it is a long term wash, and there is actually a positive total impact (on total workers).

    Human/civil rights activism... well, it is no longer popular in this country, and on top of it they do have other issues to fight, like abolition of habeas corpus.

    PS I stress legal in my name for a obvious reason - otherwise, other legal-lovers would gand up on me and claim that I am some illegal border-jumping terrorst coyote. So, I decided to highlight that I am legal and waiting just like them, but I do not share their views on the role of the undocumented.
  10. EB's Avatar
    Can we get some facts and figures? Such as, what percentage of undocumented work in service, construction, agricultural jobs? What percent are paying taxes? These unemployed Americans, is there any data on the industry they are in or what location in the US? If you are going to win over the legal immigrants, it is going to be by facts only. To keep discussing the issue of whether illegal presence is a criminal or civil violation will get you nowhere. For a legal immigrant, breaking the law is breaking the law and there are no two ways about it. Most pride themselves on having dotted the i's.




  11. EB's Avatar
    Sorry Legal and Waiting, Another Voice, I am not asking you to do more research. Are you aware of any recent data published on this? I can also look around.
  12. Legal and waiting's Avatar
    I think we discussed the unemployment numbers here once. Unemployement is indeed hihger among the American high school drop outs, but most unemployed Americans are in service industries or professions with some skills required. There is some general goverment data around it. Also, unemplyment is regional and generally depends on the regional economy - MI and the rust belt are going pretty bad for obvious reasons, but they have a declining population and not many illegals are there. In fact, labor and economic growth are like chicken and egg - one produces the other - so it is hard to distinguish the effects in terms of how much the economic activity attracts immigrants and how much immigrant population contributes to increased economic growth. There are studies out there that link growing immigrant population to the growing regions.
  13. Another voice's Avatar
    "Can we get some facts and figures? Such as, what percentage of undocumented work in service, construction, agricultural jobs? What percent are paying taxes?"

    I know that the Pew center has run the numbers on the tax issue and they found that there is surplus on the taxes paid and social services used by these immigrants. Sales Tax, property tax, payroll tax and Income tax services used are healthcare mostly in the way of ER and education. SS administration reports that the ss contributions that do not match any ss numbers presummably from undocumented immigrants amount to 7 billion a year and total 100 billion right now just sitting on the government bank account collecting interest.

    I think the breakdown you are looking for would be hard to obtain as some of these individuals work on the cash basis therefore their employment and presence is not registered anywhere. But they are spread amongst the agricultural, construction, Hospitality industry, Manufacturing, landscaping mostly.

    "For a legal immigrant, breaking the law is breaking the law and there are no two ways about it. Most pride themselves on having dotted the i's." I think it has been established plenty of times that Immigration violation constituta a civil violation not a criminal act. Therfore breaking the Immigration laws does not make these people criminals. On the other hand they did not break the law by choice they didm it because there is no available way for them to come here legally, CIR could have helped that but it failed.
  14. EB's Avatar
    Is there any argument that says that Americans are being forced to take lower paid jobs, which is why they are employed but possibly badly paid/underemployed. Some construction jobs are very well paid. What effect does having undocumented workers in the construction industry have on Americans wages? Just trying to think what the counter argument would be. On the contrary wouldn't it be great if these Americans are being pushed into taking higher skilled/higher paying jobs?
  15. Legal and waiting's Avatar
    What Borjas found was that there was an immediate negative impact of immigration on Americans with less than high school degree (to the tune of 4-8%), but the long term effect was a more of a wash . There was a positive effect on those with high school degrees and college degrees, especially, in the long run. And he is the one looking out for negative impact on wages.
  16. Middle Ground's Avatar
    "Is there any argument that says that Americans are being forced to take lower paid jobs, which is why they are employed but possibly badly paid/underemployed. "

    For the most parts, immigrants take low-level jobs that most people probably wouldn't want.

    However, ILLEGAL immigration is becoming much more rampant in construction industries than it was 10 years ago. When I worked in construction going through college, there was illegal immigration but it made up a minority of the workforce. It now appears to make up a majority of the workforce in that industry. And wages are of course in decline. Plus, with the housing market bust things are going to get very bad for construction workers.

    I don't think you can honestly say that ILLEGAL immigration has not had a profound impact on workers. It has.

    Does anyone seriously believe that American workers have not been harmed by illegal immigration?
  17. EB's Avatar
    Living in California I see alot of American constuction bosses making more money by hiring the undocumented to actually do the job. 9 out of 10 times if you hire a painting, maintenance, moving company the coordinators are American citizens hiring the undocumented for a cheap price to make more profits.
  18. Middle Ground's Avatar
    " the coordinators are American citizens hiring the undocumented for a cheap price to make more profits. "

    Good for them. But bad for the legions of Americans that aren't being hired because they aren't cheap enough.

    If the majority of people were coordinators/managers then this wouldn't be a problem - because the majority would make more $$$. But, since we can't all be chiefs it's a problem. Have you ever heard the expression "too many chiefs and not enough indians"? In this case, the only people that benefit are the "chiefs". That doesn't sound like it is in our national interest if only the elite benefit, and the not so elite lose.
  19. EB's Avatar
    "legions of Americans"

    Where are these legions of Americans? I don't see legions of Americans in California ready to do these jobs even for any price. Haven't we discussed the unemployment rate here already. Hopefully these legions of Americans you are talking about are getting higher skills, better paid jobs and running construction companies and making more profit. If everyone makes money in the process including people forced to immigrate here due to rampant poverty and starvation in Mexico then everyone benefits.
  20. Another voice's Avatar
    "However, ILLEGAL immigration is becoming much more rampant in construction industries than it was 10 years ago. When I worked in construction going through college, there was illegal immigration but it made up a minority of the workforce. It now appears to make up a majority of the workforce in that industry.And wages are of course in decline."

    The majority of Illegal Immigrants work for subcontractors on a cash basis. The subcontractors are still getting the regular rate for the construction jobs but probablly paying the workers a rate that makes them a nice profit. When it comes with competing with the regular worker the Illegal Immigrants due to the lack of documentation can not get employment directly through the contruction company. The wage effect seems to be mor an effect due to competition(supply and demand). Many subcontractors prefer new comers because they are hungry and want to work as much as they can making them more productive workers that their native counterparts. After all they have a family in another country and need to send money or save as much as possible to move on with their lives.

    Plus, with the housing market bust things are going to get very bad for construction workers."

    Housing bust will bring the whole industry down not just workers but one thing that it is important to remeber is that during the housing boom this workers wer an important part you could not build houses fast enough and migrant workers saw the opportunity to do better and took it who can blame them for that? We all want to do better that is why they come to this country.

    "I don't think you can honestly say that ILLEGAL immigration has not had a profound impact on workers. It has."

    This argument has been used by the antis for all the waves of immigrants since the beginig history of the US. All things remain the same. If we are at full employment even with a slight economic slowdown there is nothing to suggest that even housing will stay in a downturn forever therefore whern those jobs come back you will still need people to do them. As in all competitive business the one with the better price will get the jobs.

    "Does anyone seriously believe that American workers have not been harmed by illegal immigration?"

    I do, this simple economics US has the capital and immigrants are the labor a marrige of convenience. Natives have all the advantages to get better jobs than those available to Immigrants. Most of these immigrants have many barriers of entry to many jobs which is not the case for natives. Wages are set by the supply and demand.
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