The Center for Immigration Studies reported in The Impact of New Immigrants on Young Native-Born Workers, 2000-2005 that not only has the inflow of illegal immigrant workers contributing to the "fundamental breakdown in the nation's labor laws and labor standards," but so too has grown to such a level that the federal government has not kept up with enforcement.
Authors, Andrew Sum, Paul Harrington, and Ishwar Khatiwada found that for the years 2000 through 2005, half of new immigrants to the United States were illegal, and that those states where immigration was highest had a correlating drop in employment opportunities for native citizens.
"This means that illegal immigrants accounted for up to 56 percent of the net increase in
civilian employment in
the United States over the past five years."
Center for Immigration Studies, Washington DC
In New York, one of the states mentioned for having a higher rate of immigration, Think & Ask talked with a construction company owner, who agreed to discuss his practice openly in exchange for not being named. He said that he has never been queried by the Bureau of Labor Statistics (monthly business survey) or by any researcher on employment trends in the past 17-years of operation.
When asked about illegal immigration, he said, "I know they are 'just here,' came here from wherever." As his crew was breaking for lunch from replacing windows on a residential tower in Manhattan, he discussed the worker issue as it relates to owning a small business and keeping costs as low as possible. "My taxes have gone up in this administration you know, I have to cut expenses, but cannot with materials and skill," he said.
"Do you know how much I'd have to charge on bids if my guys were on an official payroll?" He estimates that his bids would have to increase some 55-65 percent if the workers he paid were legitimate employees. "I couldn't compete because all the other contractors are doing the same. I'd lose my business."
Trust also plays a factor with his crew as they work from inside residential apartments.
"How do I know the kids from Brooklyn or wherever are going to give me an honest day's work?"
"These guys do the work fast, they get cash and I get to keep my bids low," he said. "They aren't going to steal anything or they would face jail and deportation."
He pays weekly (about $15 per hour) to approximately 30 workers at time depending upon how many construction jobs are on the table.
All of his workers are male, white, and from eastern Europe. "They usually bring their friends so I'm never out there hunting down guys for labor," he said.
The Center for Immigration Studies reported that of the 4.1 million new immigrant workers, between 1.4 million and 2.7 million were estimated to be illegal immigrants. The report was released 21 September 2006. "This means that illegal immigrants accounted for up to 56 percent of the net increase in civilian employment in the United States over the past five years."
If all the jobs currently in the hands of immigrants were suddenly taken over by native-born workers, nearly all of the job deficit for males ages 16-34 would be wiped out.
Native born males between the ages of 16 and 34 saw a decline of 1.7 million employed, but the number of new male immigrants workers rose by 1.9 million. "Multivariate statistical analyses show that the probability of teens and young adults (ages 20-24) being employed was negatively affected by the number of new immigrant workers (legal and illegal) in their state," the report concluded.
Sum is the director of Center for Immigration Studies, Harrington the associate director, and Khatiwada an associate at the Center for Labor. The authors found negative impacts to be larger for younger workers, for those in school, and for native-born black and Hispanic males.
Think & Ask inquired with the general contractor on hiring black males from New York --a group with a high-rate of unemployment-- rather than young white men from eastern Europe.
"Just to put them [black men] to work? No, why would I?" he said.
"If they came to me and asked for a job and he was clean and half-way smart, I'd do the same with him as I do with these Polish guys - offer him the hourly cash," he said.
There was a time, the general contractor said, when his day labor was mainly Hispanic males, but there was growing concern with residential apartment owners of having his men inside their residences unaccompanied. "I have no complaints with these European guys - and unless you ask them a question you don't even know they can't speak English," he said.
Less Payroll Tax, New Default Labor Practices
The authors of the report added that fewer workers are being reported on payrolls, thus employers do not need to account for benefits or taxes, which supports what the New York general contractor stated at the top of this story.
The report found that the rise in immigrant employment, especially among illegal workers, during the past decade has been accompanied by a number of important changes.
Recent years have seen the growth in contractor employment relationships and the use of independent consultants and off-the-books workers. Newly hired workers miss formal payrolls and thus miss employee benefits such as health insurance and pension benefits, unemployment insurance, workers compensation, and Social Security systems.
These changing employment relationships are not simply revealed in growing media coverage of labor market developments, but show up in the large differences between employment changes registered by the two national surveys used by the Bureau of Labor Statistics to estimate monthly employment, and the Current Employment Statistics Survey (CES) payroll survey and the Current Population Survey (CPS) household survey.
While these survey results are available at the Bureau of Labor Statistic's website, the general contractor told Think & Ask that the surveys were probably bogus, "because I've never met anyone who has been given one of these surveys, but I think a lot of us [in construction] would be a little worried if we ever were asked."
Since such large numbers of new immigrant workers are not appearing on the formal payrolls of their employers, authors found an unprecedented gap between the household and payroll surveys' estimates of employment growth over the past five years.
Construction along with landscaping, retail, office cleaning, and hotel workers report strong job growth in the past few years. And the authors report these industries are leaping to take advantage of new illegal immigrants. "Many of these jobs are filled by illegal immigrants who arrive on street corners, informal shape-ups, and convenience store parking lots waiting for any of a number of potential employers to come by and pick them up for a day's work," the authors concluded.
Employers are operating outside of the legal framework that has defined labor markets since the New Deal.
Expansion of contract employment, off-the-books workers, and black labor markets in an increasing number of communities throughout the nation has meant that a growing fraction of workers now provide their labor outside of the fundamental worker protections that the nation had previously taken for granted.
The authors cite such practices now bypass wage and hour laws, worker safety and health mandates, and minimum wage protections established some 70 years ago. "These changes in labor relationships also have reduced rates of unionization, lowered the share of workers receiving key employee benefits, such as health insurance, paid vacations, and pensions and have decreased unemployment insurance, Social Security, and workers’ compensation tax receipts."
More to come the authors stated: The past formal relationships between workers and employers will continue to unravel, undermining the unemployment insurance and social security systems and basic worker protections that have evolved in the nation over the last century.
"These adverse effects on employer-worker relationships have to be taken into account in any benefit-cost calculus of the impacts of new immigration. Advocates of guest worker programs have been derelict in addressing these key economic concerns in the United States over the past five years."
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