Economic Impact of Illegal Immigrants in The United States - Economic Costs of Illegal Immigrants - Impact On Wages For Native Low Skilled Workers

Impact On Wages For Native Low Skilled Workers

National Public Radio (NPR) reported in March 2006 that: "...overall, illegal immigrants don't have a big impact on U.S. wage rates. The most respected recent studies show that most Americans would notice little difference in their paychecks if illegal immigrants suddenly disappeared from the United States. That's because most Americans don't directly compete with illegal immigrants for jobs. There is one group of Americans that would benefit from a dramatic cut in illegal immigration: high-school dropouts. Most economists agree that the wages of low-skill high-school dropouts are suppressed by somewhere between 3 percent and 8 percent because of competition from immigrants, both legal and illegal. Economists speculate that for the average high-school dropout, that would mean about a $25 a week raise if there were no job competition from immigrants. Illegal immigrants seem to have very little impact on unemployment rates. Undocumented workers certainly do take jobs that would otherwise go to legal workers. But undocumented workers also create demand that leads to new jobs. They buy food and cars and cell phones, they get haircuts and go to restaurants. On average, there is close to no net impact on the unemployment rate."

Research by George Borjas found that the influx of immigrants (both legal and illegal) from Mexico and Central America from 1980 to 2000 accounted for a 3.7% wage loss for American workers (4.5% for black Americans and 5% for Hispanic Americans). Borjas found that wage depression was greatest for workers without a high school diploma (a 7.4% reduction) because these workers face the most direct competition with immigrants, legal and illegal. In contrast, a study by Economist Giovanni Peri concluded that between 1990 and 2004, immigrant workers raised the wages of native born workers in general by 4%.

In 2009 Gordon H. Hanson at University of California-San Diego and National Bureau of Economic Research performed study on US economy and illegal immigration trend. From the study was concluded that unauthorized immigrants provide a ready source of manpower in agriculture, construction, food processing, building cleaning and maintenance, and other low-end jobs. The study was performed to see if illegal immigration affects the native workers employment. Cities with high percentage of illegal immigration were used in this study and data showed that illegal immigrants overall impact on the US economy is small. On the other hand, US employers gain from lower labor costs and the ability to use their land, capital, and technology more productively. Even if this study didn’t show huge impact on US employment by illegal immigrants, other studies show that illegal immigrant cause increase unemployment for US high school drop-offs. In February 2008, for instance, the national unemployment rate was 4.8 percent, but the unemployment rate for adults (over 25 years old) without a high school diploma was 7.3 percent. In addition the unemployment rate for youth 16–19 years old was 16.8 percent and for young adults 20– 24 years old was 8.9 percent in February, 2008. These three main groups are the employees of low paid and low skilled jobs that are usually taken by illegal immigrants. Since Alabama's New Immigration Law that was signed into law on June 9, 2011, Alabama's unemployment rate fell 1.2 percentage points in three months - September through November. At the same time neighboring state had the same trend. Tennessee and Florida had rate dropped 0.6 percent, Georgia’s unemployment declined 0.4 percent, and in Mississippi unemployment dropped mere tenth of a percent.

Read more about this topic:  Economic Impact Of Illegal Immigrants In The United States, Economic Costs of Illegal Immigrants

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