Fewer Jobs, More Imported (Poverty-Class) Workers

By James R. Edwards, Jr. on June 6, 2011

The Congressional Budget Office has updated a report on the foreign-born labor force in the United States. It uses census data from 2009. Meanwhile, the U.S. jobs outlook has weakened.

A few nuggets from the CBO report:

  • Some 38 percent of the 39 million foreign-born residents in 2009 came from Mexico and Central America.

  • In 2009, the foreign-born official unemployment rate, 9.1 percent, stood above the 7.8 percent unemployment rate of the native-born. For Mexican and Central American immigrants, unemployment was 11.1 percent.

  • In contrast to just 8 percent of native-born Americans, 56 percent of Mexican and Central American immigrants have not completed high school.

  • Median wages of Mexican and Central American immigrants were $22,000; native-born Americans earned median wages of $45,000.

CBO attempts to explain the dire employment situation of Latin American immigrants: "For people from Mexico and Central America, that pattern could be partly attributable to lower average educational attainment and to a relatively higher concentration in construction and other industries that tend to add jobs rapidly when the economy is growing rapidly and to lose jobs quickly when economic growth is slow or stalled . . . ."

Read CBO's report in light of the latest news on the worsening American jobs outlook. Aside from trimming bloated government bureaucracies, official unemployment from May shows above-the-national-average jobless rates in sectors where foreigners tend to work – construction at 16.3 percent and leisure and hospitality (i.e., restaurants, lodging) at 10.6 percent. Even agriculture stands at 8.7 percent official unemployment.

The broader measure of unemployment, the U6 rate, is now 15.8 percent (one-tenth of a percentage point lower than in April, and above the 15.7 percent for March). This measure includes the unemployed, underemployed, and those who have given up looking for a job.

Thinking policymakers might consider how constantly importing more and more cheap foreign workers to compete for American jobs with the unemployed and underemployed native-born only compounds our economic challenges.

The inescapable fact: It makes no sense to continue to flood the U.S. labor pool by importing foreigners. A naturally tighter labor market generally works better for everyone. It creates a "virtuous circle" economy characterized by steadily higher wages, worker productivity gains, higher company profits, and a strengthening middle class.