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Study shows wages rose after immigration raids
By Bridget Johnson
The Hill (Washington, DC), March 18, 2009
As the topic of immigration and workplace raids begins to heat up again in a new administration, a new study finds that wages and employment grew for legal workers after a series of 2006 raids.
The report by Jerry Kammer of the Center for Immigration Studies, a think tank that advocates against amnesty for illegal immigrants yet against mass deportations of the same, looked at the aftermath of six immigration raids at Swift & Co. meat-packing plants in Iowa, Minnesota, Nebraska, Texas, Colorado, and Utah. About 1,300 undocumented workers were arrested, and another 400 without authorization to work in the United States were detected around the same time through better company screening.
Several hundred of those arrested were charged with using fradulent Social Security numbers.
The study estimates that about 23 percent of the plants' employees were not authorized to work in the U.S, taking into account that the raids only targeted the first shift of the day and that the CIS investigation revealed large numbers of workers did not show up for the later, post-raid shifts.
"There is good evidence that after the raids the number of native-born workers increased significantly," Kammer writes, noting that all of the plants were back to full production within five months. "But Swift would not provide information on how its workforce has changed. Swift also has recruited a large number of refugees who are legal immigrants.
"At the four facilities for which we were able to obtain information, wages and bonuses rose on average 8 percent with the departure of illegal immigrants."
Kammer says that Swift used pay increases and signing bonuses to staff the plants after the raids, but bringing up wages wouldn't necessarily correlate to a hike in consumer prices.
"Research by the USDA and others indicates that wages and benefits for production workers account for only 7 to 9 percent of retail meat prices," Kammer writes. "This means that if wages and benefits were increased by one-third, consumer prices would rise by 3 percent at most."
Kammer concludes "that these six Swift plants could operate without the presence of illegal workers," even when having to restaff during a period of low national unemployment up through early 2007.
The report comes out a day after Fox News broadcast video of House Speaker Nancy Pelosi speaking out against Immigration and Customs Enforcement raids at a pro-immigrant gathering in San Francisco on Saturday.
"Who in this country would not want to change a policy of kicking in doors in the middle of the night and sending a parent away from their families?" Pelosi says in the video. "It must be stopped....What value system is that? I think it's un-American."
Fox reported that Pelosi was invited by Rep. Luis Gutierrez (D-Ill.), who is conducting a "Family Unity" tour in 20 cities "signing petitions to the President and testifying to the loss and separation caused by our broken immigration system," according to Gutierrez's website.
Immigration raids were also on the agenda when President Obama met with all 24 members of the Congressional Hispanic Caucus on Wednesday. In a press release afterward, the caucus said Obama "conveyed that he is aware of the impact the immigration raids are having on families, and assured the CHC that he is pursuing ways, including administrative first steps, to ensure the enforcement policies do not result in the separation of families."
"We believe that under his leadership we can finally provide some dignity to the thousands of families that are living in the shadows and in fear,” said caucus chairwoman Rep. Nydia M. Velázquez (D-N.Y.).
Gutierrez, chairman of the Congressional Hispanic Caucus Immigration Task Force, said, "The President showed the CHC that, although it is very early in his administration, he understands that for the immigrant community it’s the 11th hour, and there is no time to waste."
Obama also announced during the meeting that he will travel to Mexico next month to meet with President Felipe Calderon.
At a town-hall meeting in Costa Mesa, Calif., later on Wednesday, Obama stuck by his campaign-trail mantra of securing the nation's borders while putting illegal immigrants on a legalization path that would include paying fines, learning English and going "to the back of the line" behind those who take legal steps to enter the United States.
Sobering data from 2006 raids
By Jasen Lee
The Deseret News Morning News (Salt Lake City), March 18, 2009
A report by a think tank based in Washington, D.C., indicated that a raid conducted by Immigration and Customs Enforcement officials at a Cache County meatpacking facility more than two years ago drove a wedge between residents of a small Utah community and highlighted the controversy over illegal immigration.
The report titled "The 2006 Swift Raids: Assessing the Impact of Immigration Enforcement Actions at Six Facilities" was released today by the Center for Immigration Studies — a nonprofit research organization that analyzes the impacts of immigration on the United States.
The study — authored by Pulitzer Prize-winning journalist Jerry Kammer — chronicled the events surrounding the raids that took place simultaneously at six locations around the country, including Hyrum.
On Dec. 12, 2006, about 1,300 illegal immigrants working at six meat-processing plants owned by Swift & Co. were arrested in one of the largest immigration enforcement actions in U.S. history. Among those taken into custody were 158 of the approximately 1,100 workers at the Hyrum facility.
Data from the study estimated that overall, 23 percent of Swift's production workers were illegal immigrants.
All facilities resumed production on the same day as the raids, with all returning to full production within five months, the report said. That was an indication that the plants could operate at full capacity without illegal workers, Kammer said.
But companies choose to recruit workers who had few options and needed jobs, he said. Thirty years ago, the meatpacking industry boasted a standard of living that was blue-collar middle class, he added.
"The availability of a large work force that was willing to be exploited and afraid to complain sort of facilitated the transformation of the industry," he said.
The report said that Hyrum plant's annual turnover rate was 40 percent, meaning that every year, the company needed to hire 440 new workers.
"Because of the huge turnover there is real turbulence in the communities, real turmoil in schools and at social service agencies because those costs end up being passed on to the taxpayers," he said.
Last spring, the Utah legislature passed a bill to crack down on illegal immigration. Among other things, the measure requires employers to verify workers' legal status by using the same Social Security number- based system that Swift used before the 2006 raids. The measure is scheduled to go into effect this summer.
The study also showed that despite claims to the contrary, worker pay has a small impact on what consumers would pay for meat. Research by the U.S. Dairy Association indicated that wages and benefits for production workers account for 7 percent to 9 percent of retail meat prices.
That means that if wages and benefits were increased by one-third, consumer prices would increase just 3 percent, Kammer said.
One local researcher attributed many of the immigrant problems to strong-arm tactics employed by companies years ago.
"Tracking history of labor in the meatpacking industry, they went in and they busted unions," said Pam Perlich, senior research economist at the University of Utah's Bureau of Economic and Business Research. "They turned them into factories with unskilled labor with very repetitive, very high risk, very awful work and drove the unions out."
"They weren't constrained by ethics, they were just trying to make money," Perlich said.
The report noted that today, all Swift plants that were raided in 2006 would be represented by the United Food and Commercial Workers Union.
She said that for a time during the 1990s, American manufacturing companies were choosing to take their operations down to Mexico in an effort to take advantage of cheaper labor. Today, the strategy has changed to "bringing the labor north," Perlich said.
They have no need for loyalty to a community or its people, which typically leads the companies to places where they can accumulate the most profit, she said.
"These corporations don't have any souls, they are driven by the need for profit," she said.
Study Shows Immigration Enforcement Raised Wages
By Bradley Vasoli
The Bulletin (Philadelphia), March 19, 2009
While much of the immigration debate has long concerned how to fill “jobs that Americans won’t do,” a report examining one instance of immigration enforcement takes issue with that premise.
Jerry Kammer, a senior research fellow at the Washington, D.C.-based Center for Immigration Studies (CIS), wrote a backgrounder released yesterday that examines the impact of immigration enforcement on six meat-processing plants owned by Swift & Co. As a result of heightened screening and a major December 2006 workplace raid, plants in Iowa, Minnesota, Nebraska, Texas, Colorado and Utah lost an estimated 3,000 illegal-immigrant workers to firings and arrests.
How did the plants cope? Each of the six facilities took between four and five months to restart full production. But after that point, Swift was reportedly able to staff its four beef plants and two pork plants with native-born and legal-immigrant workers.
Swift could do so, Mr. Kammer wrote, in part because of the signing bonuses and wage hikes it adopted for at least four of the plants after 2006. These new policies amounted on average to a 7.7-percent increase in earnings for those plants’ production workers.
Mr. Kammer said the relevant data shows whether or not a job is one Americans will do partly depends on how lucrative that job is. That, he added, often doesn’t remain static.
“It’s just that certain jobs are defined as ‘immigrant jobs’ over time,” he said.
Other immigration experts take a different view of the success of the Swift plants in reconstructing its production staffs with native-born Americans and other legal residents.
Tamar Jacoby, president of ImmigrationWorks U.S.A., said some reporting on the Swift plants suggests while they saw an upsurge in domestic workers in the short term, they had difficulty retaining many of those workers because of the arduous working conditions.
Ms. Jacoby said companies that are forced to raise wages too rapidly sometimes face difficulty continuing their operations in the United States because they end up passing the increased costs onto their consumers, thereby making their products less competitive.
“There’s only so high they can go and remain competitive with global products,” she said, adding she did believe wages must meet a reasonable living standard. “I’m not defending below-market wages or indecent wages, but I am saying there is a limit to how much employers in certain industries can raise the wages and still remain competitive.”
United States Department of Agriculture statistics cited in the CIS study showed, in the case of meat products, wages and benefits for production workers account for between 7 and 9 percent of consumer prices. Hence, according to those figures, if pay and benefits to those workers went up by a third, retail prices would go up by a maximum of 3 percent.
A major policy implication of the study, Mr. Kammer said, is that President Barack Obama and Congress should rethink their hope to amnesty the vast majority of illegal aliens currently residing in the U.S. Such a policy was tried before in 1986 and, he said, that has only swelled the influx of illegals because immigrants in the U.S. spread the word about the generosity of America’s immigration policy to relatives back home.
“Instead of amnesty controlling it or containing it, it led to a vast expansion of it,” he said. “The immigration networks work with great efficiency.”
Study: Wages Improved At Swift Plants After 2006 Raids Picked Up Illegal Workers
The Nebraska State Paper, March 18, 2009
Wages increased in at least four Swift meatpacking plants, including one Grand Island, after the feds raided six Swift facilities around the country in 2006 and rounded up hundreds of workers who were in the United States illegally, according to a report from the Center for Immigration studies.
The study estimated that 23 percent of the Swift workers in the half-dozen plants entered the country illegally.
The detailed report looked at four company plants. The other two refused to cooperate.
In addition to improving wages and benefits, the report said more native workers took jobs at the plants.
The report looked at the impact of the raids within the communities where they occurred. One section was dedicated to the Grand Island plant. To find the study and locate the information on Grand Island, click here.
Here are key conclusions of the report, along with the section relating to Grand Island.
As is the case in the entire industry, work at the six Swift plants is characterized by difficult and dangerous conditions.
Like the rest of the industry, workers at these facilities have seen a steady decline in their standard of living. Government data show that the average wages of meatpackers in 2007 were 45 percent lower than in 1980, adjusted for inflation.
We estimate that 23 percent of Swift’s production workers were illegal immigrants.
All facilities resumed production on the same day as the raids. All returned to full production within five months. This is an indication that the plants could operate at full capacity without the presence of illegal workers.
There is good evidence that after the raids the number of native-born workers increased significantly. But Swift would not provide information on how its workforce has changed. Swift also has recruited a large number of refugees who are legal immigrants.
At the four facilities for which we were able to obtain information, wages and bonuses rose on average 8 percent with the departure of illegal immigrants.
There is a widespread perception among union officials, workers, and others in these communities that if pay and working conditions were improved, it would be dramatically easier to recruit legal workers (immigrant and native).
Worker pay has a small impact on consumer prices.
The federal investigation that culminated in the December 2006 raids at six Swift plants began putting upward pressure on salaries at the Grand Island, Neb., a month before the raid. Swift boosted the starting wage 40 cents, to $11.50 an hour. It also offered bonuses with ads that declared “Be one of the next 250 people to join the Swift & Company team, and receive up to $1,500!!” Two months after the raid, the starting wage rose to $11.75.42
The raids, which led to the arrests of 252 Swift workers in Grand Island, sparked as much controversy and debate there as they did in the other five communities. “Let’s be honest, the only growth in this stagnant town is in the Hispanic community,” one resident wrote to The Grand Island Independent, criticizing the raid as “out of touch” with reality.” Another countered, “The law has been ignored for so long that people are starting to believe it is their right to come here to live, however they can.”
A week after the raid, the president of the local UFCW union reported that “the lion’s share” of the 40 to 50 workers hired since the raid were Caucasians. But former Nebraska State Senator Ray Aguilar, whose Mexican-American family had come to the area decades before to work the sugar beet harvest, cautioned that the new hires might not last.
“Historically that’s what happened,” Aguilar said. “They get some people to come in thinking it’s a good deal. Then they end up just hating the work and they don’t want to stay.” Of course, the question of wages again looms large. If the jobs paid as well as they did three decades ago, it seems likely that retention would be much easier, whether the workers were immigrant or native-born.
Swift offered a series of recruitment incentives well into 2007. By June, it was running ads that asked in bold type, “Why is Swift a Great Place to Work?” The ads listed incentives that included relocation assistance, transportation help for anyone who traveled more than 75 miles to work at the plant, and a bonus of up to $3,000 to skilled workers who stayed at the plant for three months.
Like other Swift plants, the one in Grand Island had steadily increased its dependence on foreign-born workers over the years. First came the Vietnamese. Then came Laotians, including Prayoune Khammaly, who worked at Swift for 11 years, hoping all the while to find other work. He stayed, he said, to provide for his two children, who also worked there briefly to help pay for college. Khammaly finally left the plant to open the Oriental Market, a small grocery he still runs in downtown Grand Island.
In the 1990s, Bosnian refugees recruited from Phoenix and Sudanese refugees drawn from Omaha added to the mix in Grand Island. But the vast majority of the workers were from Latin America, mostly Mexico. While many had become permanent residents or citizens, their presence became a magnet for many who came illegally.
The rise in illegal immigration got occasional attention from the federal government. In 1992, when the Grand Island plant was owned by another company, federal agents arrested 307 illegal immigrants there. The owner, Monfort Inc., was fined $103,000 on 25 counts of knowingly hiring illegal aliens. In 1999, the plant suffered a loss of personnel that foreshadowed the drain it faced in late 2006. In both instances, workers resigned after questions were raised about the validity of the papers they had presented to show eligibility to work in the United States.
Recently, Swift has drawn several hundred Somali refugees to Grand Island. In the fall of 2008, Somali employees sought time to pray during the Muslim feast of Ramadan. When Swift accommodated their request, other employees reacted angrily, saying that the effort was cutting into their work time and reducing their pay. When the company rescinded the earlier agreement, many of the Somalis quit or were fired. Some of them moved 85 miles west, to Lexington, Neb., where another meatpacking plant agreed to accommodate their religious practices.
Shortly after the Somalis’ departure, the Independent reported that the company had found replacements in Florida and had notified the public school system that it would soon receive an influx of children of Cuban refugees. The exit of the Somalis and influx of Cubans is part of the churn that results from Swift’s 70 percent turnover rate, according to City Council member Larry Carney.
Within the community
Carney, who tutors Mexican immigrants in English, wants to involve newcomers in the life of the community. But he said the constant influx of newcomers, many of them poor and semi-literate, has led to widespread resentment in Grand Island.
“A lot of people don’t like the impact on the schools and the health care,” he said. “They think we’re paying a lot of taxes to make things viable for these people,” said Carney. He conducted an informal survey of about a dozen Grand Island residents, on the street and in coffee shops, in late 2008: “I said, ‘Knowing what you know now, would you be in favor of a Swift packing plant in GI,’” Carney recalled. “Not one person said yes.”
But Carney said his interviewees frequently added a cautionary note. “They would say, ‘Are you familiar with the purchasing power of the people who work at Swift?’”
Such ambivalence is common in Swift communities, where residents often talk of a love-hate relationship with the company. This attitude raises important questions: Would the turmoil of the constant turnover ease, could the communities live more peacefully, and could Swift operate more efficiently and profitably, if it responded to its chronic labor crisis by investing as much in improving wages and working conditions at the plant as it does in recruiting new workers? Work at a meat processing plant will never be like office work or even like cutting grass. But does it have to be as unpleasant as it has become?
Report says raids led to higher pay at packing plants
By Joe Ruff
The Omaha World Herald, March 19, 2009
Immigration raids on six Swift & Co. meatpacking plants in 2006, including one in Grand Island, Neb., resulted in higher wages and fewer illegal immigrants working at the plants, according to a nonprofit think tank that seeks to curb immigration.
In a report released today, the Center for Immigration Studies says the raids provided a good case study of what happens when illegal immigrant labor is removed from the workplace.
One finding: Although the plants had to curtail production for several months, they continued to operate without illegal workers. At least four of the plants also increased pay for workers, the report said.
The impact of immigrant labor on other workers and the economy as a whole has long been debated.
Most economists agree that immigrant labor drives down wages for low-skill workers, though how much has been a matter of disagreement. Some economists also argue that immigrant workers benefit the economy as a whole, reducing prices, taking hard-to-fill, low-wage jobs and helping fuel growth in higher-wage occupations.
The Center for Immigration Studies, a nonpartisan group based in Washington, favors limiting immigration and enforcing immigration laws to help increase wages, to relieve strains on the health care and education systems, and to support rule of law, said Steven Camarota, director of research.
Lourdes Gouveia, a professor of sociology and director of the Office of Latino/Latin American Studies at the University of Nebraska at Omaha, said she hadn't seen the report but described the center's work as generally slanted.
"Their whole point is to prove why immigration is damaging and why enforcement works."
Prompting the study was a December 2006 raid by the Immigration and Customs Enforcement agency on Swift plants in Nebraska, Iowa, Colorado, Utah, Minnesota and Texas. About 1,300 illegal immigrants were arrested.
Wages in meatpacking plants have declined over the years, the report said. If wages and working conditions improved, it might be easier to recruit legal workers, it said.
Norm Pflanz, staff attorney at the nonprofit Nebraska Appleseed Center for Law in the Public Interest, said the nation's immigration system is broken and needs to be reformed. One idea would be to admit workers as they are needed and provide better pathways to citizenship, Pflanz said.
Pflanz said that in general, companies could artificially depress wages by hiring illegal immigrants, believing that they are less likely to complain about wages, safety and health issues.
Swift executives declined to answer questions, the report said. A Brazilian company bought Swift in 2007 and renamed it JBS.
A spokesman for JBS, Chandler Keys, told The World-Herald that Swift used a government-backed computer system designed to verify the legal status of job applicants. But that system isn't perfect, he said.
Keys said JBS is competitive on wages and negotiates many of its contracts through unions.
"We want to have a thoughtful debate on immigration policy and what we need in the future to keep our type of manufacturing jobs and system in the United States," and that requires people willing to do difficult manual labor, he said.
Dave Ray, a spokesman for the American Meat Institute, which represents the packing industry, said meatpacking has long been an entry point for immigrants arriving in the United States.
Typical packinghouse wages of about $25,000 annually are competitive with salaries of nursing aides, security guards, orderlies and attendants, Ray said. "And . . . these other jobs, unlike many of the jobs in meatpacking facilities, often require a higher level of education."
According to the report, Swift knew about the investigation before the raids and tried to reduce employment of illegal workers by more rigorously checking documents and raising wages to attract workers.
After the raids, it offered signing bonuses and provided workers with transportation to remote plants that had trouble rebuilding their work forces, the report said.
The report cited newspaper ads and court records, which indicated that wages at the Grand Island plant increased 3.6 percent shortly before the raids and 2.2 percent after the raids. The plant added $500 signing bonuses, the report said.
The Greeley, Colo., plant added $1,500 signing bonuses; the Cactus, Texas, plant had a 3 percent wage increase after the raids and added a $1,000 signing bonus. The Hyrum, Utah, plant offered $2,000 signing bonuses, the report said. The other plants' wage data were unavailable.
Overall, wages increased between 6.1 percent and 9.4 percent, or 7.7 percent on average, the report said.
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