New York Post, September 11, 2023
New York politicians are clamoring for Washington to give the hundreds of thousands of migrants living in the city work permits, arguing that, as Rep. Dan Goldman (D-NY) puts it, “many businesses suffer from labor shortages.”
But this argument ignores the massive decline in labor force participation among the less-educated in New York — the share of working-age people working or at least looking for work.
New York doesn’t have a shortage or workers.
It has a shortage of people willing to work — and depressing wages by flooding the job market with migrants isn’t going to help.
Nationally, 44 million US-born working-age (16 to 64) men and women are not in the labor force — almost 10 million more than in 2000.
In New York, the number is 2.5 million.
Most of those not in the labor force do not have bachelor’s degree. Yet those calling for immigrants to fill jobs often represent hotels, restaurants and retail stores — jobs that don’t typically require higher education.
Labor force participation rate for US-born men (16 to 64) without a bachelor’s in New York has declined dramatically from 88% in 1960 to 74% in 2000, and to just 66% in April of 2023.
Focusing only on men of “prime-age” (25 to 54), who traditionally have the highest rates of work, still shows a decline for the non-college US-born from 96% in 1960 to just 83% this year.
The decades-long decline in labor force participation among the less-educated has a variety of potential explanations. Some researchers believe globalization and automation have weakened demand for less-educated labor and caused a long-term decline in wages, making work less attractive. Others point to overly generous welfare and disability programs that undermine work.
For men in particular some research holds that changing expectations about men as providers, including the decline in marriage, has caused them to value work less. There is also evidence that substance abuse, obesity, and criminal records can be causes and effects of the decline in work.
A significant body of research shows that the falloff in labor force participation among the less-educated contributes to profound social problems such as crime, drug addiction, social isolation and depression.
It hinders economic growth and creates a fiscal burden. It is also linked to the rise in “deaths of despair” — suicide, drug overdose, and alcohol poisoning. It increases social isolation, reduces political participation, and harms family formation.
Fixing this problem requires reforming our welfare and disability programs so that returning to work is emphasized whenever possible.
Combating substance abuse and the mental health crisis by expanding treatment options is clearly necessary.
Re-examining our approach to globalization, including the off-shoring of good-paying factory jobs, should also be considered.
Real wages for the less-educated have declined or stagnated for decades. Allowing wages to rise has to be a big part of the solution. One way to do so would be to reduce immigration.
In New York, immigrants account for 28% of the non-college labor force, double the share in 1970. This impacts wages, but, perhaps even more importantly, it has allowed policymakers to ignore the huge deterioration in labor force participation.
Exhibit A in this regard is the parade of politicians and business groups in New York demanding work authorization for illegal immigrants, but never even once mentioning getting Americans back to work.
We face a clear choice: either we address the decline in labor force participation, or we continue to allow in ever more immigrants to fill jobs and then somehow deal with all the social pathologies that come from so many working-age people not working.