A Migration Policy Institute study released this week concludes that less-educated immigrant workers, both legal and unauthorized, have a quite modest negative impact on the U.S. labor market.
An institute press release states:
In contrast to the broad consensus that exists regarding the benefits of highly skilled immigration, the economic role of low-skilled immigrants remains one of the most controversial questions in the immigration debate. Economists continue to disagree about the costs and benefits of less-skilled immigrants, as well as the policies that govern their admission to the United States.
The report’s author, Harry J. Holzer, who served as chief economist in the U.S Department of Labor in the Clinton Administration and is now a professor at the Georgetown Public Policy Institute, writes that from an economic perspective the goals of U.S immigration policy the goals should
- maximize the benefits of less-skilled immigration to the productivity of the U.S. economy
- minimize the potential costs of such immigration to less-educated native-born American workers, and
- help integrate less-educated immigrants without hurting the U.S economy.
Holzer is clear that any change to immigration policy would have a different impact on different groups of Americans, saying that what would benefit consumers could hurt low-skilled workers.
After comparing other studies, Holzer concludes, “immigration would only account for a small percentage of the decline in relative wages experienced by least educated workers.”
The low impact of immigrants on labor market outcomes can be explained by:
1. Since immigrant workers are consumers of local goods this consumption helps set off, partially at least, their impact on the labor market.
2. The least educated immigrant workers concentrate on jobs that require very little interaction with customers and no reading/writing work. From this perspective their impact is greater on other immigrants than on native-born workers.
3. Employers utilize low-wage low-skilled immigrants to do certain jobs that would disappear if immigrants were not available.
The study also notes that less-educated immigrants have an impact on public services, especially emergency rooms and public schools, generating a drain at the local level. But less-skilled immigrants, authorized and undocumented, pay taxes, including Social Security.
The study concludes that employers enjoy the benefits of low wages in the short term, adding:
These aggregate surplus estimates are invariably small when computed as percentages of Gross Domestic Product because immigrants remain fairly small parts of the workforce and their impacts on wages are small as well.
Consumers also benefit from the lower prices of goods and services as a result of lower wages.
Holzer states that the benefits of comprehensive immigration reform legislation, like the Senate bills of 2006 and 2007, exceed the costs, but he acknowledges that, “it is very hard to know how the labor market behavior of unauthorized immigrants and employers would respond to any legislative changes”:
It is also clear that changes in immigration policy would leave many other issues and concerns unaddressed. While unskilled immigration has clearly not been the major source of economic difficulty experienced by less educated native born Americans in recent years, the loss of earnings and employment that have experienced in the past few decades remains profound.
The full report:
