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Illegal immigration & the economy

More than a year after the economy tanked, not only do millions of Americans still find themselves out of work, but so do many undocumented immigrants.

At least the ones who are still here looking. Many immigrants returned to their home countries, such as Mexico. New migration to the U.S. dropped with the economic downturn as many would-be illegal border crossers didn’t want to risk uncertain job prospects and making it past tougher border security measures.

But with the economy poised for a rebound, will the U.S. see another increase of undocumented immigrants? And with reform legislation pending in Congress, how will the nation change when the recession finally subsides?

For one undocumented worker who SDNN interviewed outside a local Home Depot, not only are more undocumented Mexicans returning south, there is more competition.

Alex, originally from Puebla, Mexico, and who didn’t want his last name used, said he and his three brothers moved to the U.S. to support their family of 14 back home. However, for over a year now, he and his brothers have been struggling to find work.

Through a translator, Alex said he’s lucky if he works one a day week and not only that, but now there are more workers seeing daily employment. Although Alex wouldn’t give SDNN his exact compensation, he said it has dropped by a considerable amount.

Another undocumented worker, Carlos, said there are just “too many people” looking for jobs in the mornings now, that one has to get to the site early in the hopes of finding a job before others arrive.

San Diego Regional Chamber of Commerce CEO Ruben Barrales said whether one agrees with businesses hiring undocumented workers or not, they play a pivotal role in the American economic system.

“Undocumented immigrants consume things just like everybody else, not just in San Diego but wherever they are,” he said. “They are buying products and food and other commodities so the decline of undocumented immigrants in the U.S. does have an economic impact. It’s a circular contributing factor to the decline in our economy.”

So if the amount of undocumented workers doesn’t increase as the U.S. economy turns around, Barrales said, a “lag” in the economy may occur. However, “jobs are generally the last thing to come back as the economy rebounds,” he said.

Federal stimulus dollars so far have had little impact on jobs for undocumented migrants, SDSU business professor Massoud Saghafi said.
“The bank bailouts are not going to help undocumented workers,” Saghafi said. “When the small businesses or agriculture receive part of the stimulus package, when it really gets to that level - a new wave of undocumented workers will come to the country.”

“But that’s an ‘if,’” he said. “I don’t think it’s going to happen in the next five or six months.”

“At some point, we may have another flow of immigrants but I don’t know if it will be large as it has been in the past,” said Jill Esbenshade, an SDSU sociology professor who studies immigration and the global economy. “And that largely depends on the economic and political situation in their home country.”

What studies say

Immigrants — both legal and undocumented — contribute proportionally to the American economy, according to one national study.

The Fiscal Policy Institute examined the country’s 25 largest metropolitan areas. In San Diego, immigrants make up 23 percent of the local population and 23 percent of the county’s economic output while having a “negligible impact” on the overall American economy. The group found the correlation between immigrant population and economic output to be similar in the other cities too. The study also showed that immigrants contribute to all sectors of the economy.

“You can see in San Diego, which is a similar story to other places, that although there is a concentration of immigrants in lower wage occupations … there is also a very strong representation of immigrants in the higher end occupations,” said David Dyssegaard Kallick, Fiscal Policy Institute’s director of the immigration research initiative. “It shows that immigrants are really pulling their own weight.”

Immigrants generally made about the same as U.S. born workers in higher wage and lower wage occupations, according to a UC San Diego study. There is a bigger wage division in blue-collar jobs, however.

For example, in San Diego 43 percent of construction workers are foreign-born. These workers earn $31,042 whereas U.S. born construction workers make $41,389.

“Illegal immigration produces a tiny net gain to the U.S. economy after subtracting U.S.-born workers’ losses from U.S. employers’ gains,” Gordon Hanson, the director of the Center on Pacific Economies at UCSD, said in the report. “And if we account for the small fiscal burden that unauthorized immigrants impose, the overall economic benefit is close enough to zero to be essentially a wash.”

“Employers would be more likely to favor authorized workers…if the legal low-skilled immigration system responded more effectively to their needs,” the report said.

In a 2009 study by the Pew Hispanic Center, there has been a steady flow of Mexican immigrants going back to Mexico since 2006. Because there isn’t a reliable way of tracking undocumented immigrants, however, the study, as with most others, focused on immigrants as a whole.

Additionally, the study “is reinforced by data from the U.S. Border Patrol showing that apprehensions of Mexicans attempting to cross illegally into the United States decreased by a third between 2006 and 2008,” Pew said in its report.

“It remains to be seen whether either trend points to a fundamental change in U.S.-Mexico immigration patterns or is a short-term response to heightened border enforcement, the weakened U.S. economy or other forces,” according to the study.

National reform

President Barack Obama has voiced support for a “pathway” to citizenship for the estimated 10 million undocumented immigrants in the U.S.

Last month, Rep. Luis Gutierrez (D- Ill.) alongside the Congressional Hispanic Caucus and 90 House Democrats, introduced HR 4321, also known as the Comprehensive Immigration Reform for America’s Security and Prosperity Act (CIR ASAP).

The controversial bill would allow undocumented immigrants to earn “legalization” status in the U.S. for six years. Additionally, they could receive an adjustment if they “demonstrate contributions to the United States through employment, education, military service of voluntary or community service.”

Opponents of the bill including Rep. Brian Bilbray, a Republican who represents northern San Diego, say reform efforts should make it tougher for illegal immigrants to get jobs in the U.S. Bilbray has proposed a national electronic verification system called “E-Verify,” and supports a national ID card and guest worker program.

SDSU’s Saghafi said although it’s too early to determine what type of immigration reform will occur, “there’s a need for low-end labor in the U.S. as in every other country.”

“If we want the low-end jobs to attract American (workers), then wages will have to go up,” Saghafi said.

Hoa Quach is the political editor and Kristina Blake is an intern for San Diego News Network.