There is a widespread and factually incorrect belief that illegal immigration results in a loss of good jobs for hard working American citizens. According to a survey conducted by Rutgers University professors, 70 percent of Americans blame “competition and cheap labor from other countries,” and 40 percent of Americans place blame on illegal immigration. While most economists would agree that competition from cheap labor has some impact on the local job market, how much impact would likely be a point of contention across different schools of thought. Few economists, if any, would place any significant quantity of blame for a weak job market on illegal immigration.
Globalization is a double-edged sword. Entrepreneurs benefit from having access to a dramatically expanded pool of talented “techies” that can work from anywhere. These foreign contract workers cost less to hire than peers with similar skill sets in the more costly western job markets. Companies such as Elance and oDesk are exacerbating this outsourcing trend by making it even easier for contractors and entrepreneurs to find each other.
Cheap labor in countries ranging from Vietnam to China has also had a dramatic impact on determining where companies set up manufacturing hubs. Although, due to advances in robotics, machine automation, software, and manufacturing technology generally, the weighting historically placed on labor costs as a determinant for choosing where to develop products is unlikely to remain as high. High fuel and transportation costs have also served to drive manufacturing hubs closer to where their products will be sold into end markets. These are the trends that impact the job market within the United States, not illegal immigration.
In fact, some economists have posited that illegal immigration actually supports the jobs market in the United States. One example they cite is cheap kitchen labor from illegal immigrants making it easier for restaurants to remain in business, and hence providing more job opportunities for American citizens as waiters. Another oft cited example of illegal immigrants taking jobs is in the home care market providing services such as cleaning and babysitting. While this holds more water than other claims, the vast majority of these jobs are filled by U.S. citizens, not illegal immigrants. It is also murky at best, how many of these types of jobs illegal immigrants have that would otherwise be filled by American citizens. Quite possibly, if they were not filled by cheaper illegal labor, they would not be filled at all.
Fortunately for entrepreneurs, and tragically for the under-educated, technology will continue to destroy many low-skill jobs. IT services is one space that will see a particularly dramatic quantity of job loss in coming years. Technologies such as natural language processing are permitting an ever-increasing quantity of tech support to be performed by computers. Nearly free long distance communication will continue to ensure that IT jobs still requiring humans will be outsourced.
In addition to the trends already in place, there are numerous trends on the horizon that have the potential to cause more local job loss than any dynamic thus far. Driverless cars, for one, will likely one day replace truck drivers, and maybe even taxis. Caterpillar is already using driverless technology in some of its massive mineral moving trucks that travel the same route repeatedly, and hence require software that is relatively simple when compared to that required to drive on a public road. Uber and Lyft are also upending the taxi market and have already begun to cause revenue declines and job loss there. College students and any person with a little bit of free time on their hands have now become potent competition for one of the world’s oldest industries. There is no doubt that the jobs market is changing, but drawing a line between illegal immigration and a weak jobs market is tenuous at best.
By Benjamin A. Buchanan