Inmigrantes contribute to the labor market, economy

By Cindy Von Quednow

Compared to the rest of the U.S, California is the state with the most immigrants, they make up 27 per cent of the total population. The number of immigrants in the state has increased more than five times from 1.8 million to 9.6 million between 1974 and 2005, according to the Institute of Public Policy.

In the article “How Immigrants Affects California Employment and Wages,” Giovanni Peri, professor of economics at University of California, Davis, analyses these impressive figures and their affects on the California economy, and concludes by contradicting the notion that immigrant workers harm the state’s economy because  they compete with Americans for jobs thereby reducing salaries. He considers that Californians would suffer the most if immigrants did in fact harm the labor market and the economy.

It is very hard to find any negative effects, both economic and on wages, to California workers and American workers in general,” said Peri during a telephone interview. He writes in his article that if the states would be individual countries, California would be the largest recipient of immigrants after Russia.

“Immigrants compete for jobs in the US because they generate or stimulate enough jobs of the American worker. Second, they take the types of jobs that Americans are potentially moving out of so they allow the native worker to survive in what is now language intensive work and they take over the jobs that are more physically intensive. Finally, in the long run the employment effect on Americans can actually be accounted for by the increase in demand for labor which contributes to higher wages,” he added.

California’s foreign population has increased almost 40 percent in the last 14 years, where one third of the labor market is made up of immigrants and two thirds of immigrant workers are uneducated. Peri writes that since the labor market is so diverse, the relationship between immigrants and Americans is not one of competition, but of complementarily.

If you increase the number of workers, there is an increase in the demand for work and the production of wages,” said Peri. “Workers come in very different types, they have different occupations, they have different levels of education. So the idea is that each worker competes a little bit with another worker but also complements others.”

Based on the Bureau of Labor Statistics, in 2007, foreigners in the U.S. were employed more in construction, maintenance, production and transportation, while natives primarily held professional jobs. According to the recently released study, 23 percent of immigrants worked service jobs, 17.5 percent held office and sales jobs, 16 percent were in construction and maintenance and 16 percent in production and transportation. Thirty-seven percent of foreigners occupied these jobs, while natives represented 27 percent of that sector.

“There are large sectors of the economy that depend on immigrants,” said Breny Mendoza, professor of Gender and Women studies at CSUN. “If all the immigrants left, we wouldn’t eat,” she added. “Above all, the California’s economy would be destroyed.”

Both Peri, who is from Italy, and Mendoza, who is from Honduras, believe that the contribution of immigrants with postgraduate studies is unique and important.

For Mendoza, immigrants diversify academia and bring in different perspectives. “(Immigrants) are great contributors to universities and the educative process of students,” said Mendoza. “If it weren’t for that contribution . . . the educative process would be very different.”

According to Peri, Americans with some college education benefit the most from the immigrant worker complementarily, while immigrants already living in California suffer. He considers that the complementarity rates of California are higher than those of U.S. This means that in California, where immigrants are more concentrated, they are specialized in jobs that complement those of Americans and have a positive effect on those living in the state.

Peri understands that people who oppose immigration argue that studies resulting in a positive correlation between immigration and the economy are incomplete because they only study regional “pull factors.” When Peri isolated the push factors of immigrants in California, he found no evidence of negative effects.

According to the push-pull theory of immigration, people migrate from their countries for socioeconomic pressures, or are attracted to the receiving country to take on specific jobs. While pull factors are specific to a region or state, like California, push factors refer to a general migration to a country, like the U.S.

Although many experts use this theory to explain the effects of immigration, Leo Chávez, professor of anthropology and Chicano/Latino studies at the University of California, Irvine, doesn’t believe it is sufficient enough to explain why people migrate to this country.

“It’s a very simplistic model that doesn’t take into effect the historical and socioeconomic relationship between countries,” said Chávez. “There is an attraction of immigrant labor that creates a vacuum in which immigrants are sucked into, creating a demand for more labor. The interesting thing is that we don’t supply enough space for those workers."

Douglas Carranza, professor of Central American studies at CSUN believes that immigrants contribute more to their receiving country than they use. According to him, many immigrants cannot maintain an economic level that would allow them to have access to rights such as medical insurance.

“Those that don’t have documents don’t benefit, and because they are immigrants they remain at the margins of receiving benefits and rights that this society offers,” said Carranza. “I don’t think they are asking for special benefits, but equal rights as people, which is a universal right for all humanity.”

“Immigrants wouldn’t come here if there wasn’t some sort of benefit for them,” said Mendoza. “They find a job they can’t find over there and have some access to some resources their families and places of origin can benefit from.”

But those jobs don't pay much; in 2003 immigrant families in California earned almost half ($29,700) of what citizens won ($54,600), according to the Urban Institute. These numbers are even lower for families living in Los Angeles. Various studies show that when immigrants establish themselves in their new country they contribute to the economy by paying taxes, but due to their immigrant status, don’t benefit from Social Security or medical insurance.

According to the Social Security Administration, about 75 percent of undocumented immigrants pay payroll taxes, contributing approximately 7 billion to Social Security and 1.5 billion to Medicare even though they are ineligible for most government benefits. According to the Urban Institute, in 2004, 53 percent of adult immigrants in California didn’t have medical coverage, compared to 14 percent of Americans.

Chávez, who wrote the book, “Covering Immigration,” considers that issues like making medical benefits available to immigrant families are not discussed because “we are lost in the vitriolic debate” of immigration.

There are costs and benefits for everything, we should realize that rather than stigmatizing immigrants,” said Chávez about the supposed high cost of servicing medical benefits with immigrants. “The reality is that they are here to work hard and maintain the middle class lifestyle for all of us.”  

Even though he has gotten positive feedback on his studies on immigration, Peri said it is difficult to get people outside of academia to appreciate the contributions immigrants give to the country because there is a negative image of immigrants in the mainstream media. 

“The coverage is ideologized, and the debate goes on between people who claim that immigrants take away jobs from Americans and they hurt Americans,” said Peri. “These debates are simply ideas rather than fact and they simply read so-called studies with low academic credibility.”

Cindy Von Quednow/ El Nuevo Sol

"There are different types of workers, they have different jobs, they come from different levels of education, the idea is that every worker competes with another worker, but they also compliment each other," said Giovanni Peri, economics professor at UC Davis.