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Migrants and jobs in the US – some real evidence

10 March 20170 comments

Two new reports have refuted claims by supporters of US President Donald Trump that migrants and refugees in the US are taking the jobs of ordinary Americans.

The Trump administration is reportedly considering a draft executive order which calls for a substantial shake-up of the US immigration system with the aim of tightly controlling who enters the country and who can enter the workforce.

The new draft order is one of several focused on President Trump’s campaign promises to protect American workers and to create jobs while immediately restricting the flow of immigrants and temporary labourers into the US workforce.

But the two reports say that the US workforce will see growth in the next two decades only if new immigrants arrive to replace retiring baby boomers; and that there is no evidence of immigrants displacing American citizens in the workforce.

A report from the Pew Research Centre found that the US working-age (25-64) population will grow from 173 million in 2015 to 183 million in 2035.

But also that new immigrants will account for all the growth. Without them, the number of working-age Americans would drop to 166 million by 2035.

As baby boomers retire, the number of US-born working-age adults with US-born parents will account for a smaller share of working-age population: 66 per cent in 2035, down from 74 per cent in 2015, the report said.

The Pew report supports what many economists have been saying: the US needs immigrants as baby boomers retire, and an unusually large share of working-age Americans choose not to look for work.

An ageing workforce and disappointing gains in productivity have dragged down US economic growth, which was at just 1.9 per cent over the past calendar year.

The report comes as President Trump calls for the construction of a border wall to keep Mexicans from crossing into the United States in search of work. He also supports stepped up deportations of immigrants living in the US without permission.

Pew’s projections are based on current rates of immigration and combine legal immigrants with those who enter the US illegally.

A second study, by economists at Sonoma State University, in California, shows no evidence for immigrants displacing American citizens in the workforce.

“Empirically, I don’t see any evidence that immigrants are going to take our jobs or decrease our wages,” said lead researcher Professor Chong-Uk Kim.

The study, titled: ‘Immigration and domestic wage: ‘An empirical study on competition among immigrants’, was published in November 2016 in the Journal of Applied Economics.

It is based on population survey data, a monthly review of 60,000 households conducted by the US Census Bureau.

The research shows not only is there no evidence for immigrant labor hurting the economy, but that more immigrant labor actually results in a modest increase (of less than $US35 on average) in annual income for both citizens and non-citizens.

The US unemployment rate in November 2016 was 4.6 per cent, the lowest it’s been since July 2007.

Prof Kim said immigrants would not come to the US if there were no demand for their labor.

“They’re coming here because we have work for them. They’re not taking our jobs, they’re taking the jobs we don’t do anymore,” he said.

Prof Kim the backlash against foreign workers was not a new phenomenon in the US.

“A hundred years ago, the same thing happened with Italian and Irish immigrants. Now it’s happening to the Hispanic population,” he said.

But Prof Kim accepted economists were split on the issue.

“It’s still a very hot issue. There are a lot of people working on this issue, papers are published almost every day with new evidence,” he said.

But he said the haste with which the Trump administration has been acting on this issue is ill-advised.

“The new administration is making decisions so quickly based on only one perspective, and that’s very risky,” Prof Kim said.

The study also shows “no statistical difference between skilled and unskilled immigrants on the influence of domestic labour market outcomes”.

It also found that there was no internal competition among immigrants.

“The income of non-citizen workers mainly depends on state and national levels of economic situations, not the number of non-citizen workers available in the labor market,” the study said.

Laurie Nowell
AMES Australia Senior Journalist