A pragmatic look at foreign worker policy

The effect of legal immigration on the United States is in proportion to its volume and composition.

Ideally, who and how many immigrants we admit would be a reflection of informed public will, legislated with deliberation and consistently enforced. The reality, however, is quite different. Our immigration system is a hodge-podge of laws, executive orders and administrative regulations that lack intention, oversight and a clear purpose as to the stated outcome.

The U.S. issues on average over a million green cards and about 700,000 guest worker visas per year. All told, many millions of immigrants live and work under these visas in the United States. Even many "temporary" guest workers will permanently remain in the United States.

The true cost of foreign workers

A leading argument for the free flow of immigrants is that businesses, and therefore the American economy at large, benefit from access to cheaper immigrant labor. The reality is that this benefit is more than offset by the detriment to millions of Americans who suffer displacement and lower wages. And taxpayers who subsidize the costs of cheap labor.

It is true that immigration “grows the economy” by increasing the Gross Domestic Product (GDP) but this is not a measure of the overall health of the economy, it only a measure of it total size. The GDP weights everything equally, from the wages paid to immigrants to the unemployment benefits paid to displaced American workers.

What those who tout increased GDP due the influx of millions of immigrants fail to acknowledge is that those GDP gains go almost exclusively to immigrants and those who employ immigrants, which is why business lobbyists push so heavily for more employment visas, especially guest worker visas, which ensures a constant supply of compliant and lower-cost labor from abroad.

Harvard economist Georges Borjas has demonstrated that “what immigration basically does is create a redistribution of wealth from labor to people who use immigrants. It’s a win-lose situation for workers." Immigrants win in terms of paychecks and benefits but the losers, the workers who compete, see a net loss of $54.2 billion in lost or reduced wages. This is a net gain for U.S. employers.

Given that U.S. GDP is around$20 trillion, $54.2 billion is relatively modest in comparison. However, since that amount goes to a relatively small group, employers who hire immigrant workers to reduce labor costs, there is great incentive for these employers to support immigration policies that negatively affect American workers.

Andy Puzder, former Secretary of Labor puts this so-called “savings” into perspective in another way, explaining that, “It makes no economic sense to spend trillions on welfare and jobless benefits for out-of-work Americans while bringing in foreign workers to fill jobs in their place.”

U.S. Employers do not need H-2B visa holders and guest workers to fill "jobs Americans won't do."

The H-2B visa program brings in low-skilled, non-agricultural workers to fill seasonal jobs. These tend to be labor-intensive, or repetitive jobs generally in food processing, landscaping, construction, housekeeping, and certain retail jobs. These jobs are ones that can not be off-shored and so the H-2B visa serves as a way for employers to drive wages and working conditions down in the United States by importing workers from abroad. H-2B employers argue, contrary to fact, that there aren't workers "available" to take these jobs, even if pay were increased.

An attendant argument is that with the official unemployment rate at a low level, we don’t have enough Americans to fill our job needs. But the official unemployment rates reflect only a small piece of the truth. The labor force participation rate, a much more accurate measure of the health of the economy, is well-below what it was before the onset of the Great Recession and reflects the fact that the United States is facing a crisis of systematic unemployment. The best way to address this crisis is to reduce the number of foreign workers entering the United States.

About 50 million adults between 18 and 65 are not working. While this number includes family caregivers, students, and the ill and disabled, the BLS reports that in October of 2018, 11.5 million Americans were available and wanted to start working immediately.
Of these, 1.6 million reported having looked for a job in the past year or wanting a job, but had given up searching over a year ago. 5.9 million workers listed "other" as a reason for not having a job, so little is known about them, but this number includes some proportion of retirement age people and people with mild disabilities who would work if jobs were available to them.

A labor shortage means a lack of available workers, not an abundance of available workers employers prefer not to hire. Corporate lobbyists who call for more foreign workers ignore Americans who are out of work, even disparage them as lazy or otherwise unworthy of being given a chance to earn a living in their own country. When employers say there are “jobs Americans won’t do” these claims must be challenged, and an answer demanded as to which Americans they are referring.

Ignoring the existence of millions of unemployed Americans, or denigrating them as unfit to work, is not only costly but harmful to our social fabric. Not surprisingly, multiple studies, such as the 2011 study conducted by the University of Nevada Lincy Institute, found that unemployment negatively impacted physical and mental health. The effects on families in terms of divorce, depression, suicide, black market and other crime, and drug and alcohol addiction, far outweigh the incremental tax dollars derived from additional business profits.

Legal Immigration
High-skilled Americans