Immigration Reform in 2010
César Chávez Institute, San Francisco State Univ.
Immigration in Times of Recession
Implications for Policy
Pia Orrenius, Ph.D.
Federal Reserve Bank of Dallas
Disclaimer: The views expressed herein are those of the presenter;
they do not necessarily reflect the views of the Federal Reserve
Bank of Dallas or the Federal Reserve System.
Road Map
Effects of recession on


Foreign-born workers
Foreign-born population
Regional differences

Foreign-born vs. U.S.-born workers
Boom and bust

Lessons for the recovery
Immigration policy: ready for recovery?
Job losses:
Taking a toll
Current job losses worst since 1945
Dec/Dec % Change
5
4
3
2
1
0
-1
-2
U.S.
-3
-4
1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008
Source: Bureau of Labor Statistics
Employment declines broad based
% Change
Nat.
Resources Const.
and Mining
Mfg.
Trade,
Financial Prof & Educ. & Leisure & Other
Info.
Transp &
Activities Business Health
Hosp.
Util.
Services Services
Note: Employment change from December 2007 to December 2009
Source: Bureau of Labor Statistics
Govt.
Total
Immigrant unemployment rate
rises above native rate
Immigrant
Native
Source: Orrenius and Zavodny 2009; BLS
Foreign-born unemployment rates
rise most for less-educated
Percent
Source: Orrenius and Zavodny 2009; BLS
Immigration: Slowing
The foreign-born population
stagnates in 2008
2008
Millions
45
Percent
16
40
14
35
12
30
10
25
8
20
Number
6
15
10
4
5
2
0
0
1850
1870
1890
1910
Source: Census Bureau through 2008
1930
1950
1970
1990
2007
Unauthorized immigrant
population falling?
Note: *DHS estimates not available for 2001-2004.
Source: Department of Homeland Security; Pew Hispanic Center
New border fence 20 ft high
Source: Wayne Cornelius (2009) “Evaluating US Immigration Control Policy”
Source: Wayne Cornelius (2009) “Evaluating US Immigration Control Policy”
More border enforcement, more
port-of-entry attempts
Emigration from Mexico in
steep decline
Thousands
Source: INEGI 2009 (Mexican National Statistical and Geographical Institute)
Apprehensions a function of labor demand
(De-trended employment; lagged apprehensions)
Thousands, SA
180
Employment
Thousands, SA
2000
160
1500
140
1000
120
500
100
0
80
-500
60
-1000
40
20
Apprehensions
0
-1500
-2000
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Source: BLS; DHS; Authors’ own calculations
Geographic differences:
Immigrant/native
outcomes differ by state
Employment Growth by State
OK
MS
LA
WY
TX
CA
AZ
ID
VT
Source: CIS, BLS
Foreign-Born Populations Decline in Florida,
California
Percent
(2008/2007 percent change)
Source: Bureau of the Census
Boom and bust:
Lessons for the
recovery
Some lessons from the
recession so far
Immigration is pro-cyclical
Immigrants are hurt more by recessions

Helped more by expansions
Immigrants are in different
industries/occupations/states than natives

Limits labor market competition
Immigrants key to the recovery
Labor force growth

Immigrants account for one-half labor force
growth
U.S. labor force participation
rate has peaked
Source: BLS
Labor force participation rate:
Male, female rates falling since 2000
Men
Women
Source: BLS
Immigrants key to the recovery
Labor force growth

Immigrants account for one-half labor force growth
Efficiency gains



Complement native workers at high, low ends of skill
distribution
Fill jobs natives shun
Move to where jobs are
Productivity growth

High-skilled immigration instrumental in high-tech
innovation, R&D
Drawbacks


Winners and losers
Adverse fiscal impact of low-skilled immigration
Immigration Policy:
Ready for recovery?
Green cards go to family, not workbased immigrants
Note: Data represent FY 2005-2008 averages
Source: DHS, 2008 Yearbook of Immigrant Statistics
So workers come on temporary,
not
permanent
visas
Thousands
Note: Data represent 2004 to 2008 averages for new arrivals
Source: State Department Visa Office; Passel and Cohn 2008, Pew
Hispanic Center; DHS Yearbook of Immigration Statistics
Most skilled workers use temporary
visas
Thousands
Note: Data from 1992 to 2008
Source: Statistical Yearbook of the INS; DHS Yearbook of Immigration Statistics;
Visa office of the State Department
Almost all legal low-skilled workers
use temporary visas
Note: Data from 1992 to 2008
Source: Statistical Yearbook of the INS; DHS Yearbook of Immigration Statistics;
visa office of the State Department
Most low-skilled workers come
illegally
Source: Jeffrey Passel and Roberto Suro, Pew Hispanic Center (2005); Passel and Cohn, Pew Hispanic Center (2008).
Absorbing temporary workers
under current system is like
swallowing this fish…
Green card queues spell a decadelong wait in many cases
Thousands
3,000
Years
14
Time
12
2,500
Visas
10
2,000
8
1,500
6
1,000
4
500
2
0
0
Employment Based
Family Sponsored
Source: State Department Visa Bulletin, March 2009; Wadhwa et al. 2007,
Ewing Marion Kaufmann Foundation ; Authors’ own estimates
Family-based green card queue for
Mexicans 60 years?
Years
Thousands
1,200
70
60
1,000
Time
50
800
40
600
Visas
30
400
20
200
0
Source: State Department Visa Bulletin, March 2009; Authors’ own estimates
10
0
Conclusion
Immigration is slowing
due to the economy
U.S. long-run growth
will still depend on
immigrants
Policy environment is
completely inadequate
to deal w/ legal, illegal
immigration
Amnesty alone is not
enough; we need to
address future flows
Worksite enforcement jumps
6000
Criminal Arrests
5000
Administrative
Arrests
4000
3000
2000
1000
0
2002
Source: DHS
2003
2004
2005
2006
2007
2008
Current policy
environment in flux
Some Bush policies on hold
 No-match program, Real ID Act, worksite raids,
higher employer fines
 E-verify: immigration status verification
Obama policies: focus on labor regulations?
 Legalization?
Local, state ordinances reg. illegal immigrants;
enforcement of federal law
Interminable queues for green cards; running out of
temporary visas