The Hidden Costs and Benefits of Illegal Immigration

According to Glenn Loury, professor of Economics at Brown University, many of the economic arguments informing the immigration debate are based on faulty numbers and unproven assumptions. Loury talks to Farai Chideya about the real economic impact of illegal immigration.

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FARAI CHIDEYA, host:

And our last headline is an economic story. On Friday, the Department of Labor released its latest job numbers. It turns out that April was the weakest month for new jobs in two years, and the unemployment rate rose one point to four and a half percent. Immigration help shape America's labor pool and economy and opportunities for black Americans. Now politicians are expected to make some decisions on how to deal with undocumented workers. Congress is getting ready to debate a bill that would support a guest worker program.

So for our weekly look at these and other top-economic issues, we're joined by economist Glenn Loury, professor of economics at Brown University. Glenn, how are you doing?

Professor GLENN LOURY (Economics, Brown University): Hey there, Farai. How are you?

CHIDEYA: I'm great. So before we get into the economics of immigration, let's take a look at the latest numbers. Now you've got this employment statistics not looking so good. Should Americans feel like they shouldn't make big purchases, they should be insecure about their finances?

Prof. LOURY: No, I wouldn't say that. I mean, I don't want make light of any unemployment, but four and a half percent unemployment rate overall is not at all bad given our historical experience. And I don't see any reason that people shouldn't feel reasonably confident about the economy.

CHIDEYA: I was just in Detroit, actually - in the Detroit area, visiting some friends. And people there are really reeling from the housing industry, the job industry - obviously, that's specific. But manufacturing declined by nearly 20,000. So is this something that is really striking America as a whole, the erosion of the manufacturing base that started decades ago?

Prof. LOURY: As you say, it's something that's been going on for sometime, and the automobile and related industries are in the United States, up against a lot of international competition. And I wouldn't be surprised to learn that Detroit was on relatively hard times. But as I say overall, it doesn't look to me like - you know, the housing market is also been down. People are having a hard time selling their houses, but I don't see a recession at hand, so I want to stick by my relatively optimistic forecast overall.

CHIDEYA: All right. Well, it's good to hear that. So, let's move on to the immigration debate. So…

Prof. LOURY: Yeah.

CHIDEYA: …you have the undocumented immigration population in the U.S. What are the rough numbers?

Prof. LOURY: Well, we're talking about up 11 million or so - according to the estimates that I've seen - undocumented workers in the country - undocumented persons, I should say - in the country with, I don't know, five or six million of those in the workforce. You know, it's hard to estimate people that you're not counting directly, but that's my understanding of it.

CHIDEYA: And there was a recent study by the Pew Hispanic Center in Washington. They said that the undocumented immigration population totals about five percent of the workforce. That sounds like an awful lot. And again, you say that these figures may not always be completely accurate. But does that sound about right to you?

Prof. LOURY: Yeah. That's consistent with what I was saying. In the workforce, well, it's probably - I don't know the number exactly. I'm going to say about 110 million, 115 million American workers overall. So that sounds about right to me.

CHIDEYA: What impact does this have on specific communities like, for example, white-collar communities versus blue-collar communities? Do you have any sense of that?

Prof. LOURY: Well, the immigrant work force is relatively unskilled. Most of the undocumented immigrants in the country, in fact, are from Mexico. They're on the average, less educated, concentrated in - not in white-collar jobs, but in jobs in the service industry and hotel and restaurant and hospital work and other places where the skill requirements are not so great. So the competition there will be relatively less skilled American workers.

The impact of immigration is good for employers. It keeps wages down. Immigrants are less likely to join unions, less likely to complain about their working conditions or about overtime. It's good for customers of goods and services because the prices are kept down. And it should be harmful to domestic workers, although the evidence of large negative effects of immigration on domestic workers is difficult to find.

CHIDEYA: When it comes to black workers, I mean, some members of the Congressional Black Caucus have been pretty supportive of immigration reform that would open the doors to undocumented workers having more rights or more standing in the U.S. Other folks have said, look. You know, this is hurting our constituents. What's your belief?

Prof. LOURY: Well, I'd said two things here. One is that whatever the effect on black workers might be doesn't completely resolve the question of where black representatives or American representatives ought to stand on the issue, because it's not only the interest of black workers that should be taken into account.

So what I'm trying to say is if the right thing to do - from the sense of justice or what kind of country we want to be - is to do this or that by our undocumented immigrant workers, then that's the right thing to do. And one might want to do it even though it might, on the margin, not be helpful to blacks.

But having said that, I want to say that, as I say, quantitative evidence of big, negative effects on employment or wages for blacks from immigration is hard to find. It's hard to find. There's a careful study of the Mariel boatlift, for example, which was a kind of natural experiment where a large number of Cuban immigrants were, if you will, dumped on the shores of Southern Florida all of a sudden in effort to try to find in the years after whether there was any negative effect on workers and black workers of this unexpected influx. And the evidence was not there.

But, I would say this. I would say that the right question to ask here is what kind of labor market policy, what kind of education policy, and what kind of politics would we have and didn't have such large immigration? And my view is that if these people weren't coming in to the workforce, the employers would be so desperate for workers that they would become a lobby on behalf of locking up fewer people, spending more money on education, fixing the problems in our society that are harmful to, you know, in preventing people from getting skills, because they would be out of workers and they'd be looking for them somewhere. So my sense is while the direct effect of, let's say, Mexican immigrants coming across the border into Texas and Arizona, New Mexico and California on blacks who live in those places does not seem to be so great, the indirect effect, which is a safety valve for employers which keeps the employers from having to worry about how we solve the problems that have our jails so full of young black men, for example, well might be harmful to blacks in this indirect way.

CHIDEYA: Well, let's turn to the presidential race. You have a Republican candidate, Tom Tancredo, saying that, you know, he wants to really end undocumented immigrants' life in the U.S. How realistic is it that we can deport five percent of the workforce?

Prof. LOURY: Yeah, it's not realistic at all that we would do that. As I said at the start, first of all, from a human rights and a kind of humanitarian point of view just imagine it. Just imagine what it would mean logistically. I mean rounding up five percent of the workforce, compelling their departure from the country, just think about what that would mean. No, we're not going to do that.

Moreover, what are all those restaurateurs and all those furniture manufacturers and all those construction firms and all those farms whose vegetables lie rotting on the vine going to do if they don't have those workers? They're not going to sit by and watch themselves be put out of economic business, as it were, by being deprived of their labor force. So it's not going to happen.

CHIDEYA: And there has been a large business community involvement in saying we should have a guest worker program or an amnesty. I want to end on this note, though. T. Willard Fair, president of the National Urban League of greater Miami, which we were just talking about Miami, said amnesty for illegal workers is not just a slap in the face to black Americans, it's an economic disaster. Very briefly, is he right?

Prof. LOURY: I don't think so. Although I understand - I can feel the brother, as they say, in that, you know, black Americans have been passed by before. I mean, this is not a new story. Booker T. Washington, 1896, was talking about, you know, use your domestic African American labor. Don't import the immigrants, then from southern and Eastern Europe. We've been passed by before. And sitting in Miami, where the Cuban community prospers on the whole, the blacks of Liberty City and other poor communities in and around Miami, who have rioted in the past, have got to feel some resentment. So I can - I see where he's coming from. But, symbolically, in a sense, amnesty for immigrants is a kind of, you know, it's a kind of affirmative action in a certain kind of way for non-black minority people, which again may cause some resentment among blacks.

CHIDEYA: All right.

Prof. LOURY: And to the extent that we - yes, I'm sorry.

CHIDEYA: We're gong to have to leave it there, but I'm sure that that's a provocative note to end on. And Glenn, thanks so much.

Prof. LOURY: Okay, you're welcome.

CHIDEYA: Glenn Loury is professor of economics at Brown University, and he joined us from the studios of WRNI in Providence, Rhode Island.

(Soundbite of music)

Unidentified Man: (Rapping) Another funky rhythm, look at your man and give him a high-five because I'm like running around with 'em. Telling everybody hanging out on the block it's time to wake up and check the clock. Punch it!

CHIDEYA: Just ahead, the black body as a commodity. Frank talk about African-American role in the sex industry. And later, a new look at the hidden life of Secretary of State Condoleezza Rice.

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