Freedom Folks

Thursday, March 30, 2006

Exploding the Myth of Illegal Immigrates Doing Jobs Americans Won’t Do

This piece was contributed by a new blog pal. James Kotthoff has been delivering trenchant and witty comments for a couple of weeks now so I extended an offer for him to write for this blog. I found this in my email this morning...

Exploding the Myth of Illegal Immigrates Doing Jobs Americans Won’t Do

By James Kotthoff

I have been following the recent controversy on immigration reform closely for some time. I hear all the “facts” as stated by pro immigration groups. I think it is time to explore more fully some of these statements to see where the facts actually lead us.

Before we do we have to agree on some basic principles? Basic economic laws are not complicated and the most basic is “Supply and demand.” Simply put if supply is higher than demand price falls. If demand is higher than supply price rises. This is not a theory this is an absolute fact. If there are more cars for sale then people to buy them car prices fall and the inverse if more people want cars than are available car prices rise. In anything this rule holds absolute.

Now let us look at the following statement as exposed by many pro immigration forces including the White House. “Illegal Immigrants Do Jobs Americans Won’t Do.” Nice in theory and if true that justifies a certain amount of unskilled immigrant labor. But lets delve a little deeper into this concept. The question really becomes is it that Americans won’t do these jobs or won’t do these jobs at the same wage as illegal immigrants? Later we will look at H1B visas and there impact but for the moment we will look at unskilled and low skilled positions.
First let us look at an industry by industry breakdown of what industries employ most illegal immigrants.
Drywall and Ceiling Tile Installers 27%
Landscaping Services 26%
Domestic Help (Maids/Housekeepers) 22%
Roofers 21%
Animal Slaughter and Processing 20%
Hotel Industry 13%
Food Service 11%
Agriculture 11%
Construction 10%
This information comes from the Pew Center for Hispanic research. As you will note there is no category where illegal immigrants are a majority of employees. So how does this bear out the contention that illegal immigrants do the jobs Americans won’t do? I will let you draw your own conclusions.

The next question is does this have an effect on wages? When we remember the rule Supply versus Demand it is simple to answer. A supply of labor that is higher than the demand for labor lowers wages across the board in that given industry.

Now lets examine unemployment in the U.S. Keep in mind that the official unemployment rate understates the actual number of unemployed due to the way it is calculated. The government unemployment figures does not include any of the following: students, underemployed (part time employees - not by choice) or discouraged workers (Those who have totally dropped out of the labor market). According to the Bureau of Labor Statistics for February 2006.

Total Unemployment Ages 16 and over - 5.1%
Which means about 7.6 million officially unemployed but if you add those not included in the official estimate you can at least double that figure.
If you take away agricultural work the figure is higher
Nonagricultural Workers - 5.3%
That still means 6.2 million officially unemployed.
Now lets look at a breakdown by industry.
Mining - 3.8%
Construction - 8.6%
Manufacturing - 4.9%
Durable Goods - 4.4%
Non-Durable Goods - 5.7%
Wholesale and Retail Trades - 5.4%
Transportation and Utilities - 4.6%
Information Services - 3.7%
Financial Activities - 2.8%
Professional and Business Services - 6.5%
Education and Health Services - 2.8%
Leisure and Hospitality - 9.1%
Other Services - 4.4%
Agricultural and related - 9.9%
Government Workers - 2.3%
Self Employed and Unpaid Family Workers - 3.1%
When you start to look at the figures and compare the unemployed with the illegal immigrants working in that specific industry you will see how the basic idea of illegal immigrants doing the jobs Americans won’t do is flawed. Lets look at one more set of statistics wages and labor supply. The following figures are based on the analysis of Harvard Economist George Borjas. Average wage loss due to mass immigration. This doesn’t break it down to illegal and legal immigration but it is an interesting indicator in which to draw a conclusion. This is figured from 1980 -2000 and uses education level as the base. This only looks at native born males. High school dropouts lost 7.4% of their income. High school graduates lost 2.4%. Those with some college lost 2.3%. College graduates lost 3.1%. Now if you notice the biggest loses occur at the unskilled/low skilled level. Which directly correlates with the highest skill level of illegal immigrants.

So my conclusion is that without getting into the socio-economic cost of illegal immigration one simply needs to look at the direct economic impact to understand it is not positive. And to answer the question of illegal immigrants doing jobs Americans won’t one simply has to let the numbers speak for themselves.

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