an ambitious and independent person, Rodolfo has demonstrated entrepreneurial skills as well. When he was on disability, he was quite concerned that he would be unable to make a living. He approached his father and proposed that they work together to make extra money. Since his father is an excellent mechanic, they bought and fixed used cars, and then sold the cars for a profit. For example, they bought one truck body for $300, and after they had fixed it, sold it for $4,000. At his father’s suggestion, Rodolfo also moved back in with the family during his recovery so that Rodolfo could cut down on living expenses. Today Rodolfo’s father continues to buy and repair used cars, but Rodolfo cannot help him because he is busy with his job at Star Products and with setting up his business.
Rodolfo has made an agreement with the president of Star Products about becoming an independent contractor to provide the company with janitorial services. The way this came about is that Rodolfo noticed that the president often complained about the regular janitorial service. Apparently, they are very sloppy in their work, sometimes leaving the offices in a worse state than when they arrived. Rodolfo started picking up after them because he thought that the mess they left reflected poorly on the company. Customers frequent this establishment and he believed that it was important to have a clean work environment. Eventually the president noticed and suggested that he contract with the company independently to clean the place up after-hours. Rodolfo took this suggestion seriously and decided that this would be an important business opportunity for himself and his family.
Since he spoke with the president of the company, he has been slowly buying pieces of cleaning equipment, some costing as much as $1,600. Initially Rodolfo plans to work his regular day hours at the company and then have his wife help him clean the Star Products facilities at night. He figures that the president of Star Products has other business connections that Rodolfo’s business can benefit from. In time, he hopes to expand his business with these connections and looks forward to owning his own business. He has thought out, planned, and negotiated all the details very carefully. At first, he will be working on a probationary basis in order to allow his employer to examine his work to make sure it is satisfactory. During this time, the president has agreed to pay him a regular wage (as if he were doing his regular job), but at an overtime rate. After one month, if his work is satisfactory, he will go on contract status and finally be independent. He will be securing a worker’s compensation package for himself and his wife, and he has applied for a business license. He learned what he needed to do to start his independent janitorial contract business by helping and observing a friend who owns his own janitorial contracting service. He helped his friend finish jobs out of friendship and without compensation. Now this friend is advising Rodolfo and helping him start his own business.
Allegations about the economic “impact” of immigrants brings to mind acquaintances and former clients like Rodolfo and his family. They are not representative of all immigrants. But they are also not atypical. Most of my Mexican clients have been more like Rodolfo than unlike him. They defy the stereotype of the poor immigrant lured across the border by the ease of life on welfare. They are hardworking, honest, very family oriented, and not criminals. As Rodolfo’s job history reveals, they may take low-paying jobs, but they keep an eye open for better-paying positions. The twin economic arguments—job and wage displacement, and net fiscal burdens in the public sector—appear to involve contradictory stereotypes of the hardworking immigrant willing to take any job, and the pathologically welfare-dependent or costly immigrant.
Anticipating that some will be skeptical of an anecdotal approach centered around the experiences of one individual, I now turn to hard economic realities.
chapter 4 Searching for the Truth about Immigrants and Jobs
We are young and we come to the United States to work. And [using government services] looks bad. If I know I can pay my doctor, I don’t need to go to the government. I don’t need food stamps. That’s for the old people, for the children that don’t have no fathers. I don’t feel good if I go over there and I can be working. You can find a job in the United States anywhere you go. Especially if you can speak a little bit of English. If you don’t speak no English, you get your green card. If you don’t get your green card, you work in the fields, you work dishwash[-ing], everywhere. There’s a lot of work.
— RODOLFO MARTINEZ PADILLA, age 31 native of Michoacan, Mexico
Negative images of immigrants and their purported impact on the U.S. economy have permeated the airwaves and print media headlines of late. These images largely revolve around two anti-immigrant arguments, broadly conceived of as “economic” in nature. The first argument posits that immigrants have a negative effect on the labor market, displacing native workers and depressing wages. The second is that immigrants burden the public coffers. The labor market complaint is the subject of this chapter, while the next chapter addresses the costs and revenues of immigrants.
The image of immigrants as labor market demons is fueled by comments such as those of Congressman Lamar Smith of Texas, who authored major legislation in the House of Representatives in 1996: “[I]n places where immigrants tend to congregate, particularly in the cities, … the direct impact on citizens, particularly low-income, low-skill citizens, is that they lose jobs and their wages are depressed as a result.”1 Consider also the views of Daniel A. Stein, executive director of the Federation for American Immigration Reform: “This is throwing kerosene on the blaze.… Immigration is destroying the American middle class.… It’s one of the key factors degrading labor in this country.”2
Accompanying these negative images are a host of state and federal policy proposals—some aimed at undocumented aliens, but many directed at lawful immigrants and refugees. These efforts extend far beyond the 1986 law making it illegal for employers to hire undocumented workers or California’s Proposition 187 which would preclude undocumented aliens from attending public schools, receiving welfare, and obtaining services from publicly funded health facilities. While the constitutionality of Proposition 187 is being determined by the federal courts, it is emblematic of several legislative actions and proposals. These include cutting back on public benefits and social programs available to legal immigrants (ranging from Supplemental Security Income to school lunch and milk programs for lawful resident schoolchildren), denying driver’s licenses to undocumented aliens, making it a felony for an undocumented person to apply to a state university, adding resources to the Border Patrol, calling out the National Guard to help enforce the border, charging a border toll, amending the Fourteenth Amendment so that birth in the United States does not confer citizenship upon a newborn if the parents are undocumented, and cutting back on legal immigration by a third.
The twin economic allegations and the flurry of legislation directed against immigrants demand that we inform ourselves as much as possible before forming judgments (and policies) on proposals that are premised on beliefs about economic impact. A fair reading of available, accurate research suggests that allegations of the negative impact of immigrants on the economy are overblown and largely unsupported. The most reliable studies show that the level of anti-immigrant rhetoric based on economic arguments is simply not justified.
Before considering actual studies that have been conducted on immigrants and the labor market, a theoretical framework—developed from observations of the market—is helpful.
THINKING ABOUT JOBS AND WAGES
IMMIGRANTS AND JOB CREATION
One concern about immigrants is that every job that goes to an immigrant is a job that a native worker loses (or fails to gain). The fear that immigrants take away jobs from native workers rests on the theory that the number of jobs is static or fixed. Under this theory, when immigrants get jobs, fewer jobs are left for native workers thereby causing increases in unemployment among native laborers.
The idea of a fixed workforce has a certain commonsense appeal, but is inaccurate. The number of jobs is dynamic rather than fixed. As more persons begin working and spending their earnings, the demand for more goods follows,