Business

NYT, Brookings Unwittingly Show How Immigration Affects Wages

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Rachel Stoltzfoos Staff Reporter

Wages for many American workers continue to decline, hitting workers the most in industries where demand for work is increasing, a new study found. One explanation via the Brookings Institution is that immigrants fill a disproportionate share of those jobs.

The New York Times covered the National Employment Law Project study:

“Despite steady gains in hiring, a falling unemployment rate and other signs of an improving economy, take-home pay for many American workers has effectively fallen since the economic recovery began in 2009 …

“The declines were greatest for the lowest-paid workers in sectors where hiring has been strong — home health care, food preparation and retailing — even though wages were already below average to begin with in those service industries.”

The study raises the question: Why would wages be falling the most in industries with greater demand for workers?

The Times notes that “macroeconomic forces like automation, demographics and globalization” are contributing to falling wages, and refers to ongoing slack in the labor market — the labor supply is still outstripping the (increasing) demand for work.

One explanation the Times doesn’t mention directly is that immigrants share a disproportionately high share of these jobs, and are to some extent crowding American workers out of these low-skilled, high in demand industries.

A 2012 Brookings Institution report found that many of the jobs in the occupations deemed fastest and largest growing by the Bureau of Labor Statistics are going to immigrants — in many of the same occupations the Times reports have seen the greatest decline in wages in recent years.

The NELP report lists restaurant cooks, food preparation workers, home and personal care aides and cleaning service jobs as those that have taken the biggest hit in wages. Real wages for restaurant cooks have declined 8.9 percent since 2009.

The Brookings report found immigrants (legal and illegal) are clustered in those same sectors — health care, food prep and service and the accommodations industry. In private households, immigrants were 49 percent of all workers, in the accommodation sector they were 31 percent, and in home and personal care they were more than 20 percent of all workers.

Among the 15 occupations expected to see the largest numerical growth in coming years, eight had high shares of foreign-born workers, and among the 15 fastest growing occupations, seven had high shares of foreign-born workers.

“If current trends continue, we would expect to see these occupations filled disproportionately by immigrants,” the Brookings report stated in 2012.

Here is a New York Times chart based on the NELP report that shows where wages declined the most, followed by a chart from the Brookings report that shows how immigrants share in the largest growing jobs. You can compare the overlap.

Screen Shot 2015-09-04 at 8.25.20 AMScreen Shot 2015-09-04 at 10.30.46 AM

In 1970, immigrants made up approximately 5 percent of the population and 5 percent of the civilian labor force, the Brookings report notes. In 2010 that number grew to 23.1 million immigrants in the labor force, making up 16.4 percent of the total.

“As the economy sputters along with some signs of improvement, people often point to the U.S. Bureau of Labor Statistics’s list of fastest-growing occupations as the bright spots in the labor market,” Bloomberg Business reported in a 2012 story about the Brookings report.

“These occupations—in nursing, home health care, and food service—are low-skilled, low-pay jobs, but at least they are market segments that present opportunity.  Much of that opportunity, it turns out, is being seized by immigrants.”

Since 1970, the foreign-born population has increased by more than 325 percent, while wages and share of income fell. (RELATED: Wages Declined As Immigration Surged)

The U.S. foreign-born population — legal and illegal immigrants — is at an all-time high of 42.1 million, recent Census Bureau data shows. And by 2023 the foreign-born population will exceed 51 million — the largest share of total population ever recorded in American history.

Nearly one in five U.S. residents will be an immigrant by 2060, largely because of legal immigration, not illegal immigration, a previous Center for Immigration Studies analysis of the Census data found. And immigrants will account for 82 percent of population growth in the U.S. from 2010 through 2060.

If federal law is not changed, the U.S. is on track to issue 10 million green cards over the next decade — a massive new permanent resident bloc larger than the combined populations of Iowa, New Hampshire and South Carolina.

(Photo: Screenshot/ Center for Immigration Studies)

 

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