"Illegal immigration does have some undeniably negative economic effects. Similarly skilled native-born workers are faced with a choice of either accepting lower pay or not working in the field at all. Labor economists have concluded that undocumented workers have lowered the wages of U.S. adults without a high-school diploma — 25 million of them — by anywhere between 0.4 to 7.4 percent.
The impact on everyone else, though, is surprisingly positive. Giovanni Peri, an economist at the University of California, Davis, has written a series of influential papers comparing the labor markets in states with high immigration levels to those with low ones. He concluded that undocumented workers do not compete with skilled laborers — instead, they complement them. Economies, as Adam Smith argued in “Wealth of Nations,” work best when workers become specialized and divide up tasks among themselves.""In states with more undocumented immigrants, Peri said, skilled workers made more money and worked more hours; the economy’s productivity grew. From 1990 to 2007, undocumented workers increased legal workers’ pay in complementary jobs by up to 10 percent.""There are many ways to debate immigration, but when it comes to economics, there isn’t much of a debate at all. Nearly all economists, of all political persuasions, agree that immigrants — those here legally or not — benefit the overall economy. “That is not controversial,” Heidi Shierholz, an economist at the Economic Policy Institute, told me. Shierholz also said that “there is a consensus that, on average, the incomes of families in this country are increased by a small, but clearly positive amount, because of immigration.”The benefit multiplies over the long haul. As the baby boomers retire, the post-boom generation’s burden to finance their retirement is greatly alleviated by undocumented immigrants. Stephen Goss, chief actuary for the Social Security Administration, told me that undocumented workers contribute about $15 billion a year to Social Security through payroll taxes. They only take out $1 billion (very few undocumented workers are eligible to receive benefits). Over the years, undocumented workers have contributed up to $300 billion, or nearly 10 percent, of the $2.7 trillion Social Security Trust Fund."
Sunday, February 17, 2013
Do Illegal Immigrants Actually Hurt the U.S. Economy?
Click here to read the article from today's NY Times magazine. Excerpts: