Tag: immigration

Why Unemployment Is Lower When Immigration Is Higher

“We are going to have an immigration system that works, but one that works for the American people,” Donald Trump told the Republican National Convention last week. “Decades of record immigration have produced lower wages and higher unemployment for our citizens.” But the candidate is wrong in two respects. First, the United States has not seen “record” immigration in recent years, and second, higher immigration is not associated with higher unemployment. Immigrants are heralds of growth, not portents of economic disaster. 

Recent immigration is no record

The amount of immigration to the United States can be measured in two ways. The most obvious is the absolute number of people receiving permanent residency in the United States. By this measure, the peak year was 1991 with 1.8 million. Even by this measure, Trump is wrong. Rather than “decades of record immigration,” out of the top ten highest levels of all time, five occurred since 1990 and five before 1915.

But measuring immigration in terms of the absolute number of permanent residents is narrow and misleading. The biggest problem is that it implies that a million immigrants entering China, with a population of 1.4 billion, would have the same effect on employment as a million entering Estonia with a population of 1.2 million. Clearly, to understand the impact of immigration, you need to control for the size of the destination country.

Table 1: Top Ten Immigration Rates and Immigration Levels 1820 to 2014

  Year Rate   Year Number
1 1854 1.61% 1 1991 1,826,595
2 1850 1.59% 2 1990 1,535,872
3 1851 1.58% 3 1907 1,285,349
4 1882 1.50% 4 2006 1,266,129
5 1852 1.49% 5 1914 1,218,480
6 1907 1.48% 6 1913 1,197,892
7 1853 1.43% 7 2009 1,130,818
8 1849 1.31% 8 2005 1,122,257
9 1881 1.30% 9 2008 1,107,126
10 1906 1.29% 10 1906 1,100,735
Present 2014 0.32% Present 2014 1,016,518

Source: Department of Homeland Security. “2014 Yearbook of Immigration Statistics.”  

By this measure, that “record year” of 1990 comes in 52nd overall. Rather than decades of record immigration, we see decades of below average immigration. Indeed, per capita immigration during the current decade is almost 30 percent lower than the historical average, and five times less than the record rates in the 19th and 20th centuries.

Why Congress Rejected an H-1B Recruitment Requirement

Several senators recently introduced a bill that would delay the hiring of H-1B high skilled foreign workers in order to give Americans extra time to apply, saying it would make the program “consistent with Congress’s original intent.” But the lack of this provision was no oversight. The authors of the H-1B law wanted the visa to be able to rapidly respond to U.S. labor market needs, not get bogged down in regulatory red tape.

The Immigration Act of 1990 created the H-1B visa. Previously, there was just one H-1 category for skilled professionals that was uncapped and had no labor restrictions. The 1990 act imposed a cap for the first time and required that H-1Bs be paid the “prevailing wage” for their occupation in the area of employment. The theory was that U.S. businesses would have no reason to prefer foreign workers if they had to pay them as much as they paid Americans.

Although the bill did have several restrictive measures, the absence of a recruitment mandate was intentionally left out for a very good reason. 

Just 3 years prior to the introduction of the 1990 Immigration Act, Congress created the H-2A visa for seasonal farm workers and mandated that H-2A employers make “positive recruitment efforts” of U.S. workers prior to hiring foreign workers. Regulators translated this to mean that a farmer needed to spend 60 days advertising and accepting referrals of U.S. employees from state employment offices.

If H-1B crafters wanted to impose a recruitment requirement, they knew how. Indeed, the lead cosponsor of the 1990 bill, Sen. Alan Simpson, was also the author of the H-2A language. “Congress also expressly determined,” wrote immigration attorney Angelo Paparelli just after the enacting regulations were announced in 1991, “that the H-1B ‘attestation-like’ procedures… should be a speedy streamlined process with no recruitment requirement.”

The senators who drafted the 1990 act had a very specific reason in mind when they declined to include such language. Unlike the H-2A, H-1B jobs are not limited to “seasonal” positions, meaning that any recruitment would typically have to take place while the job was open. This means that an H-1B recruitment requirement would have guaranteed that companies would be losing productivity throughout the period.

Defending Green Cards

The 2016 GOP platform states that:

“In light of the alarming levels of unemployment and underemployment in this country, it is indefensible to continue offering lawful permanent residence to more than one million foreign nationals every year.”

The GOP platform statement assumes that those on green cards take jobs from Americans, an assumption that is incorrect (see here, here, and here for more information). 

What’s actually indefensible about our green card system is how few of them come here for work purposes.  First, legal immigrant inflows to the U.S. as a percent of our population are small compared to other developed countries (Figure 1).  The only countries with fewer immigrant inflows as a percent of their populations are Portugal, Korea, Mexico, and Japan.  The United States does allow more immigration as an absolute number than any other country but we also have a very large population, making these annual flow figures seem small.

Figure 1

Immigrant Inflows as a Percent of Population, 2013

 

Sources: OECD, EuroStat, E-Stat, Citizenship and Immigration Canada.

These relatively small immigrant flows have only produced an immigrant percentage of our population that is midrange among the OECD countries (Figure 2).  New Zealand has the highest at 28.4 percent of their population while Mexico has the lowest at 0.84 percent of theirs.  The United States is in the middle at 13 percent.  Our legal immigration system is so restrictive that without unauthorized immigrants the U.S. population of the foreign-born would only be about 9.5 percent of our population – a 28 percent reduction in present numbers.

Figure 2

Immigrant Stock as a Percent of the Population, 2013

Source: OECD.

Green card workers admitted as a percentage of the total annual immigrant inflow are far lower here than in other countries (Figure 3).  Only about 7.7 percent of all green cards annually issued by the U.S. government are for workers – virtually all of them high skilled.  The employment-based green card system allowed about 140,000 green cards to be issued annually but that number also includes the family members of those workers.  In 2014, 56 percent of green cards set aside for skilled workers actually went to family while 44 percent were for the workers themselves.  The GOP platform wants to decrease this already small number of green cards for skilled workers even further.  

Visa Caps Are Protectionist Occupational Licenses on Steroids

Conservatives across the country, from—Michigan to Arizona—are challenging burdensome occupational licenses. “Insiders use the false cover of consumer protection to get laws enacted that keep out new competitors,” Minnesota Republican state Senator Chris Gerlach recently said, explaining his reform bill. While a welcome development, conservatives should extend this logic to an even more pervasive form of anti-consumer protectionism: work visa restrictions.

Work visas are licenses for foreign workers and entrepreneurs to practice their professions in the United States. And just as other occupational licenses artificially inflate prices for consumers, arbitrary visa quotas prevent consumers from accessing services that immigrants would provide. It’s protectionism, and it harms Americans every bit as much as unnecessary occupational licensing.

Yet even while the new Republican Party platform calls “excessive licensing requirements” a “structural impediment which progressives throw in the path of poor people,” it claims that it is “indefensible” that the U.S. government allows a million immigrants to live and work in the United States each year. The two positions are at odds. Occupational licenses limit the choices of American consumers in a few industries, while visa restrictions do so in every industry.

Indeed, the research on this point is clear: immigration generally lowers prices, especially for labor-intensive goods. National Research Council’s canonical report found that “the benefits of immigration from lower prices are spread quite uniformly across most types of domestic consumers.” Likewise, economist Patricia Cortes’s acclaimed 2008 study found that for every 10 percent increase in low-skilled immigrants, the price of immigrant-intensive services fell by 2.1 percent.

Economists Robert Lipsey and Birgitta Swedenborg quantified how labor restrictions harm consumers in the end. “Countries in which prices of labor-intensive services are very high, such as the Nordic countries, consume much less of them,” they wrote in a 2007 paper, meaning that people in those places simply cannot access the same range of products and services that Americans can, thanks in large part to immigration.

Visa restrictions make people in those countries poorer.

How to Save Refugees with U.S. Ties

Refugees have few options to flee persecution both quickly and legally. Only a tiny fraction are granted access to formal refugee programs, and while other legal immigration avenues are available, they have quotas that can trap people attempting to escape violence in massive backlogs. But Congress could solve this problem by exempting immigrants from the quotas when they are otherwise eligible for a visa and meet the definition of a refugee.

Why are refugees with U.S. ties forced to wait?

With the exception of immediate family of American citizens, the U.S. government places strict limits on the number of immigrant visas issued each year. When more people apply than visas are made available, the process becomes backlogged. Some applicants from more populous countries must wait a decade or more for a visa number to become available. Nearly 4.6 million people were waiting for employer- or family-sponsored visas as of November 2015.

Under the Refugee Act of 1980, refugees admitted under the formal refugee program are exempted from the normal worldwide limits on immigration. They are also exempted from almost all of the non-criminal requirements for entry—health, income, etc. These exemptions make sense if the goal is to save victims of violence.

Yet as soon as refugees apply for other immigration programs, where they actually meet the qualitative requirements to enter the United States, the caps are enforced against them, and they are forced to wait just like anyone else. This makes no sense. People who otherwise meet all of the criteria for admission to the United States should not die due to an arbitrary and inflexible quota.

The government does not estimate how many people in the visa lines are refugees, but certain countries from which the United States has received a large number of refugees have thousands of people waiting for a visa. The United States, for example, has accepted 39,000 refugees from Iran since 2005, yet another 53,000 Iranians are currently waiting overseas for a visa under the non-refugee programs. In Syria, we have accepted roughly 8,200 refugees since 2005 with another roughly 6,400 waiting in line for an immigrant visa as of fiscal year 2014.

Graph: Immigrant Visas Issued, Refugee Admissions, and Immigrant Visas Pending for Syria and Iran

Of course, the majority of these applicants are unlikely to be refugees, but those who are will get caught up in the backlog just the same—with possibly fatal consequences. (You can read here about the Syrian mother of Rep. Steve Russell’s friend who was killed waiting for a visa.) While Congress should increase the green card limits generally, a specific exemption could save thousands of refugees around the world from persecution, violence, and death.

Why can’t these refugees access the U.S. refugee program?

Under the Refugee Act, the president does have the authority to admit as many refugees of “special humanitarian concern to the United States” as he decides, so the president could simply increase the number of slots and allow refugees who are waiting for visas to apply directly to the program. Indeed, President Obama took both of these actions on behalf of Syrian refugees this fiscal year.

But this fails to solve the problem for several reasons. First, the refugee program is so slow, often taking more than two years to process a single person, that these refugees are just being pushed from one wait list to another. The regular immigration process is faster based on the reasonable rationale that people with proven U.S. ties present a lower potential security threat than others.

Here’s the much bigger problem: because refugees are entitled to so many federal benefits, the program has a de facto cap. The president can only admit as many refugees as Congress appropriates money to fund. Unless Congress increases funding, something it is unlikely to do, green card applicants only take away slots from refugees without any other option to immigrate to the United States.

The president could allow—as I have suggested elsewhere—some refugees to be admitted under the refugee program without benefits or with sponsors who reimburse the government. But admitting refugees who are already eligible under other family- or employer-based programs, which bar their access to benefits, would obtain essentially the same result, allowing the United States to invite in more refugees per dollar spent than under the formal U.S. refugee program.

Even if Congress did fund an increase in refugee expenditures, it would still not make sense to push people with other legal immigration options into the refugee system. The United States can help more people if it simply numerically exempts refugees with pending green cards—who have U.S. sponsors to support them if necessary—instead of sending them to the slower and more expensive refugee program.

How can Congress reform the law?

Congress could fix this issue with a simple change to the Immigration and Nationality Act (INA)—subsections (c) and (d) of section 201—to state that immigrants who are designated as refugees by the United Nations High Commissioner for Refugees or present proof that they meet the definition of a refugee (under section 101) shall not be included in the quota calculation for employer- or family-sponsored green card limits.

Typical complaints about refugees—that “we don’t know who they are”—shouldn’t apply here. By virtue of their connection to the United States, we do know who they are: they are a close relative of a U.S. resident or an employee of a U.S. company, and it makes little sense to force these people to suffer for an extra few years. After all, they are coming either way—let’s just make sure that it’s not in a body bag.

The Public Is Increasingly Pro-Immigration

James G. Gimpel’s new report for the Center for Immigration Studies (CIS) has a good summary of voter opinion on immigration and how the issue influenced the rise of Donald Trump.  Undoubtedly, that issue key to his success in the GOP primary, although it’s unclear why equally nativist but more polite candidates like Mike Huckabee, Rick Santorum, and Scott Walker failed to gain traction.        

My only problem with this report is its selective display of Gallup’s immigration polling data.  The CIS starts reporting the results in 1999 and omits whether Americans support more immigration (Figure 1).  By starting the data in 1999, the report is able to argue that opposition to legal immigration and those supporting the same number of immigrants have been roughly constant since 1999. 

Figure 1

CIS Graph   

 

Source: Immigration Opinion and the Rise of Donald Trump.

If the CIS report had included the “Increased” immigration option in the poll and the years going back to 1965, you would have seen this (Figure 2).  I highlighted the years 1993 and 2015 to show how far public opinion has shifted toward the pro-immigration side over the last 22 years. 

We Don’t Need More Border Patrol

Trump’s call for a wall along the border reflects a common desire to control that supposedly lawless frontier.  As far as unauthorized immigration goes, the border is coming under increasing control.  337,117 total unauthorized immigrants were apprehended by Border Patrol in 2015, the lowest number since 1971 (Chart 1).  That number will likely rise this year but will still remain low.  

Chart 1

Border Patrol Apprehensions

 

Source: Customs and Border Protection.

Like the rest of government, Border Patrol has grown considerably over the decades despite the fall in apprehensions.  In 2015 there were just over 20,000 Border Patrol agents, double the number in 2002 and 6.3 times as many as were employed in 1986 (Chart 2). 

Chart 2

Border Patrol Officers

 

Source: Customs and Border Protection.

The increase in the size of Border Patrol has likely decreased unauthorized immigration, although the precise amount is up for debate (read this excellent report for more information).  On the opposite side, there is consistent evidence that border security does not affect the number of illegal entries but can dissuade migrants from leaving once they make it in.  Although the effect of Border Patrol and security on illegal entries is not entirely clear, it is obvious that the average Border Patrol officer is apprehending fewer unauthorized immigrants than at any time in decades with the exception of 2011 (Chart 3).

Chart 3

Apprehensions Per Border Patrol Agent

Source: Customs and Border Protection.

There is already too much corruption in Customs and Border Protection, exacerbated by rapid expansions in the size of their force.  New hiring binges will likely increase the struggles with corruption still more.  Problems with agency corruption and a low period in unlawful immigration are superb arguments against expanding and perhaps to even shrink the Border Patrol back to a reasonable size.

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