The Impact of Illegal Immigration on the Wages and ...

[Pages:90]The Impact of Illegal Immigration on the Wages

and Employment Opportunities

of Black Workers

A Briefing Before The United States Commission on Civil Rights

Held in Washington, DC

Briefing Report

Letter of Transmittal

The President The President of the Senate The Speaker of the House

Sirs and Madam:

The United States Commission on Civil Rights (Commission) is pleased to transmit this report, The Impact ofIllegal Immigration on the Wages and Employment Opportunities of Black Workers. A panel of experts briefed members of the Commission on April 4, 2008 regarding the evidence for economic loss and job opportunity costs to black workers attributable to illegal immigration. The panelists also described non-economic factors contributing to the depression of black wages and employment rates. Based on that discussion, the Commission developed the findings and recommendation that are included in this report.

Among its findings, the Commission notes that the illegal workers are estimated to account for as much as one-third of total immigrants in the United States, and that illegal immigration has tended to increase the supply of low-skilled, low-wage labor available. The Commission found also that about six in 10 adult black males have a high school diploma or less, and are disproportionately employed in the low-skilled labor market in likely competition with immigrants. Evidence for negative effects of such competition ranged from modest to significant, according to the experts who testified, but even those experts who viewed the effects as modest overall found significant effects in occupations such as meatpacking and construction.

The Commission views this topic as complex, and therefore makes no specific recommendations at this time. The Commission recommends generally, however, that the Bureau of Labor Statistics and other appropriate governmental agencies collect data concerning the presence of illegal workers in the U.S. workforce and on the employment and wage rate effects of such workers on lowskilled and low-wage workers of all races. The Commission believes that such data should be made available to the public.

Part A, which consists of the body of this report, was approved on January 15, 2010 by Chairman Reynolds and Commissioners Kirsanow, Heriot, and Taylor. Vice Chair Thernstrom and Commissioners Gaziano and Melendez abstained. Commissioner Yaki voted against. Vote tallies for each of the Commission`s findings and recommendation, which make up Part B of the report, are noted therein.

Table of Contents

Table of Contents

Executive Summary ............................................................................................................................... 1 Findings and Recommendation.......................................................................................................... 3 Summary of Proceedings ...................................................................................................................... 5

Panel One...................................................................................................................................5 Gordon Hanson .................................................................................................................... 5 Gerald Jaynes........................................................................................................................ 6 Vernon Briggs, Jr. ............................................................................................................................ 7 Harry Holzer......................................................................................................................... 9 Discussion ............................................................................................................... 10

Panel Two................................................................................................................................15 Julie Hotchkiss .................................................................................................................. 15 Steven Camarota ................................................................................................................17 Richard Nadler ............................................................................................................................... 18 Carol Swain ........................................................................................................................19 Discussion ........................................................................................................................... 20

Statements .............................................................................................................................................. 24 Gordon H. Hanson...................................................................................................................24 Gerald D. Jaynes......................................................................................................................27 Vernon M. Briggs, Jr. ....................................................................................................................... 35 Harry J. Holzer.........................................................................................................................40 Julie Hotchkiss.........................................................................................................................44 Steven A. Camarota.................................................................................................................48 Richard Nadler ........................................................................................................................53 Carol M. Swain........................................................................................................................62 Public Comment .....................................................................................................................65

Speaker Biographies .................................................................................................................66 Gordon Hanson........................................................................................................................66 Gerald Jaynes...........................................................................................................................66 Vernon M. Briggs, Jr. ........................................................................................................... 66

Impact of Illegal Immigration on the Wages & Employment of Black Workers

Harry J. Holzer..........................................................................................................................67 Julie Hotchkiss .......................................................................................................................... 67 Steven A. Camarota..................................................................................................................67 Richard Nadler.......................................................................................................................... 68 Carol M. Swain ......................................................................................................................... 68 Statements of Commissioners...................................................................................................69 Dissent of Commissioners Michael Yaki and Arlan Melendez ............................................69 Statement and Rebuttal of Commissioner Gail Heriot..........................................................69 Rebuttal of Commissioner Peter N. Kirsanow.........................................................................71 Rebuttal of Commissioners Michael Yaki and Arlan Melendez............................................79

Executive Summary

1

Executive Summary

In the midst of public debate over immigration reform, the U.S. Commission on Civil Rights voted to examine the possible effects of illegal immigration on particularly vulnerable segments of the U.S. working population, specifically low-skill black workers.1 Since the April 4, 2008 briefing, the severe economic downturn has affected workers in general, and--if unemployment rates are any indication--has had an even more severe impact on low-skill workers.2

To help air important aspects of the debate, the Commission invited experts who have published and spoken on this issue to weigh the relative effects of factors that influence black low-skill workers` wages, job gains or losses and report their conclusions to the Commission. The speakers discussed factors that included the economic costs to this particular group,3 fiscal costs to taxpayers of social services for low-skill workers, competing skill levels of affected workers, the economic gains to the U.S. economy as a whole from flexible, low-cost labor,4 and what constitutes a fair comparison between legal and illegal workers and their job opportunities.5

The Commission selected balanced panels that included Harry Holzer, professor of public policy at Georgetown University; Gordon H. Hanson, professor of economics at the University of California, San Diego; Julie Hotchkiss, research economist and policy advisor at the Federal Reserve Bank of Atlanta; Vernon Briggs, professor emeritus of labor economics at Cornell University; Gerald Jaynes, professor of economics and African American Studies at Yale University; Richard Nadler, president of Americas Majority Foundation; Carol Swain, professor of political science and law at Vanderbilt University; and Steven Camarota, director of research at the Center for Immigration Studies in Washington, DC.

1 See, e.g., Lori Montgomery, Immigration Lifts Wages, Report Says, White House Asserts Only Least-Skilled Native Workers Are Hurt, Washington Post, June 21, 2007, at D3.; Charles Herman, Illegals: Will They Be Taking Jobs Away From U.S. Citizens? ABC News Business Unit, May 18, 2007, ; Illegal Aliens Depress Wages for Some in US, New York Times, March 20, 1988, at section 1, p. 25. 2 The Bureau of Labor Statistics notes that as of November 2008, unemployment rates for individuals over the age of 25 with less than a high school diploma was 15.0%, 5 percent more than the national unemployment average of 10 percent for the same time period. 3 See, e.g., Vernon M. Briggs, Jr., The Economic Well-Being of Black Americans: The Overarching Influence of U.S. Immigration Policies, The Review of Black Political Economy, 15-42 (2003). 4 See, e.g., Gordon H. Hanson, The Economic Logic of Illegal Immigration, Council on Foreign Relations, CSR No. 26, April 2007, . (accessed August 31, 2009). 5 See, e.g., George J. Borjas, Jeffrey Grogger, and Gordon H. Hanson, Imperfect Substitution Between Immigrants and Natives: A Reappraisal, March, 2008, (accessed August 31, 2009); but see Gianmarco Ottaviano and Giovanni Peri, The Effects of Immigration on U.S. Wages and Rents: A General Equilibrium Approach, September 26, 2007, (accessed September 9, 2009).

2

Impact of Illegal Immigration on the Wages & Employment of Black Workers

Although available data did not distinguish precisely between legal and illegal immigration in their effects on wages and employment of black workers, most panelists agreed that illegal immigration appears to have had at least some negative effects on the wages and employment of workers in the low-skill labor market. The panelists disagreed as to the magnitude of that effect, which ranged from very small to substantial. Three of the panelists who were economists argued that immigration, both legal and illegal, has economically benefited the United States on a national basis in the form of lower prices to consumers and increased economic investment in the country.6 One presented employment statistics only for the State of Georgia that she asserted could be generalized to a nationwide inquiry, but did not express an opinion as to the magnitude of the national effects.7 Another panelist spoke to the specific negative effects of illegal immigration on the population at risk, black male workers.8

The panelists addressed the following issues in response to Commissioners` questions:

The consensus by panelists that there is a negative effect on wages of low-skill black workers and the range of the negative effects;

The importance of other factors contributing to low-skill black unemployment;

Possible discrimination resulting from the use of ethnic networks;

Benefits and costs to the U.S. economy from illegal immigration;

Policy recommendations from panelists, including strict enforcement of existing immigration laws;

Effect of capital flows, including those across and within national borders,that decrease the negative effects of immigration;

Tradeoffs to employers between increasing their capital investment versus hiring more low-wage workers;

The potential disruption to the economy and to low-wage workers and communities of abrupt economic changes resulting from enforcing immigration laws strictly;

The sharp differences between the employment opportunities of low-skill black men and low-skill black women;

The ethical and civil rights implications of using immigration to drive down low-skill wages.

6 Dr. Hanson, Dr. Jaynes, and Dr. Holzer.

7 Dr. Hotchkiss. 8 Dr. Swain.

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