GOOGLE, YAHOO and Sun Microsystems were all founded by immigrants -- from Russia, Taiwan and India, respectively. There is near-universal agreement that skilled immigrants are an enormous boon to the American economy.
But what about the millions of unskilled laborers who arrive in this country every year?
Recent public discourse would have us believe that they poach American jobs, lower wages and sponge off welfare. Yet economic research suggests a different picture: Unskilled immigrants are good for the U.S., and the U.S. is good for them.
Until the late 1990s, when a boom in native-born self-employment occurred, immigrants were more likely than natives to work for themselves. Immigrant small businesses, from the Korean corner market to the Mexican landscaping service, are, well, as American as apple pie. The labor market is not a zero-sum game with a finite number of jobs; immigrants create their own work.
A key question for economists has been whether the influx raises or lowers "native" American wages. UC Berkeley's David Card, who studied patterns in different U.S. cities, concludes that immigration has not lowered wages for American workers. George Borjas of Harvard counters that immigration reduced the wages of high school dropouts by 7.4% between 1980 and 2000.
Most economists have sided with Card. For one thing, his studies better capture the notion that immigrant labor makes work easier for all of us and brings new skills to the table. Additionally, as Card points out, the percentage of native-born high school dropouts has fallen sharply over the previous decades, creating a shortage of unskilled laborers that immigrants fill. In 1980, one in three American adults had less than a high school education; by 2000, this figure had fallen to less than one in five.
Gianmarco Ottaviano of the University of Bologna and Giovanni Peri of the National Bureau of Economic Research have shown that immigrants and low-skilled American workers fulfill very different roles in the economy. For instance, 54% of tailors in the U.S. are foreign-born, compared with less than 1% of crane operators. A similar discrepancy exists between plaster-stucco masons (44% immigrant) and sewer-pipe cleaners (less than 1% foreign-born). Immigrants come to the United States with different skills, inclinations and ideas; they are not looking to simply copy the behavior of American workers.
