Feb 28,2007 00:00
One of the most common charges in the immigration debate is that immigrants compete for jobs and lower the wages of U.S.-born workers. This isn't the case, according to a study released today by the Public Policy Institute of California (PPIC). Examining over 40 years of data using precise statistical methods, the analysis goes beyond most previous research to show comprehensively how immigration affects the job opportunities and wages of U.S.-born workers in the state.
Between 1990 and 2004 alone, new immigrants accounted for a 20 percent increase in the state's total employment. Yet, rather than hurting job prospects for natives, the influx of immigrants increased the average real wages of native workers in
"The strong positive effect on native workers' wages seems remarkable if you assume that by increasing the labor supply, immigrants reduce the demand for native workers," says study author Giovanni Peri, an associate professor of economics at the
After examining more than four decades of employment and wage data (1960- 2004), the study finds a clear, positive overall association between the increase of foreign-born workers and the wage growth of native workers. The primary reason for this is that as the number of immigrants available for certain jobs and tasks increases, so does the need for complementary jobs in managing, organizing, and training -- work typically done by natives. "Native workers benefit because they are able to specialize more," says Peri. "In other words, the increased supply of one type of worker fuels the demand for another."
The boost in wages is sharpest among natives who are of a different age and education level than the immigrants they are being compared with -- however, there is a slight positive effect even between those in the exact same bracket. The finding refutes a central assumption in most previous research -- that immigrant labor is a perfect substitute for native labor.
The actual losers in the equation are prior immigrants, whose wages are hurt by the newcomers. In 2004, immigrants who had entered
The study also challenges the belief that the rapid growth of foreign-born workers in
The new report, How Immigrants Affect California Employment and Wages, could have important national implications. Because