Feds: Immigration raids stimulate job growth

Commonly accepted wisdom states that, as things currently stand, immigrants fill jobs that most native-born American workers don't want. However, a report by the Center for Immigration Studies recently found that, when the feds come banging on the door of a factory, net new jobs are created. According to the study, immigration raids neither cripple a factory nor result in the return of illegal labor. In fact, the center says that the raided plants were up and running again -- with full staffs -- within months, and most of the positions occupied by illegal immigrants were staffed with legal employees.

The exact composition of the post-raid workforce varies by region. In the western portion of the country, a raid on a plant that had a workforce comprised mostly of Hispanic employees (90 percent), the undocumented employees were replaced mostly by U.S.-born Hispanics and white employees. In North Carolina, however, a facility whose workforce was 80 percent Hispanic before an investigation saw illegal employees replaced mostly by African-American employees, who now comprise 70 percent of the company's employee base. In the Great Plains states, a growing number of Sudanese, Somalis and Southeast Asian immigrants are finding positions at food-processing plants.

Constrained economic conditions are playing a role in post-raid employment composition, as Americans born in the United States are more willing to take jobs that were once the domain of undocumented labor. In some cases, these workers are filling a majority of the available positions: on construction sites, for example, employees born in the United States outnumber immigrants by a 3:1 ratio and they outnumber immigrants by a ratio of 2:1 in farming, fishing and forestry jobs.

In addition to effectively creating more jobs, federal investigations are leading to higher wages. Following a raid on several food-processing facilities, for example, increased pay was necessary to bring legal employees into the factory, as the fresh memory of federal intervention drove away the illegal labor pool.

While the benefits to people authorized to work in the United States are salient, the situation is probably not as rosy for factories as the immigration authorities would have you believe. Though it only takes a plant a few months to return to full capacity, that lost productivity has a clear impact on the value produced by factory assets and employees. The increase in wages -- and, ostensibly, other costs related to compliance with employment regulations -- adds another layer of expense that did not exist prior to the raids. This, in turn, puts more pressure on manufacturers.

Thus, raids create jobs, but these jobs come at a price. Although employers should be paying these costs anyway, it doesn't change the fact that the increased expenses may be devastating for many companies. In the past, illegal immigrants would have returned to factory positions following an immigration raid, but a difficult labor market has changed this dynamic, with legal workers backfilling those who were not. Production costs go up, but immigration enforcement nonetheless is acting as a small stimulus program.

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