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Work In Progress-Interview With Harry Holzer

Wednesday, December 20, 2006

Harry Holzer is Professor of Public Policy at Georgetown University. For the NBR special "Work in Progress," NBR Washington Bureau Chief Darren Gersh spoke with Professor Holzer about the impact of immigration on the US workforce. What follows is the transcript of their entire conversation; an edited version appeared in the broadcast report.

Darren Gersh: What is the main impact of immigration on the workforce?

Harry Holzer:
The biggest effect would be on low skilled workers – with a high school education or less. And there the effects are, there’s some job competition, but the overall effects on earnings and employment are fairly modest. Particularly in the longer run.

Gersh: Why are they modest?

Professor Harry Holzer

Holzer:
Well, for one thing, the immigrants tend to be concentrated in about a half dozen states near ports of entry. And they are concentrated in a relatively small number of industries. The vast majority of native born workers never end up competing with an immigrant. A lot of immigrants end up in jobs that, at the current wage levels, native born workers just aren’t very interested in.”These are often hot, dirty, low-wage jobs, often considered menial in agriculture, landscaping, cleaning rooms in buildings.

Now there are some good jobs too like construction that the immigrants might get, and those might have an impact on the native workers. And they might keep wages down below what they might otherwise be. But what the data show are when immigrants aren’t available most employers don’t really bid wages up. They just bring in more machinery to do what otherwise the workers would have done or they may open fewer businesses in exactly that line of work.

Gersh: But in constructions could you see particular jobs like drywallers, roofers, that are hit pretty hard?

Holzer:
In those locations where the immigrant network is well developed, that’s an industry where migrants might enter and could have an impact on the native born workers.
Not for electricians or plumbers or things that require longer term training and credentials, but on the low-end jobs, you could see that’s an area where the presence of immigrants might take some jobs from native-born folks.

Gersh: Overall, what is the impact immigrants have on workers?

Holzer:
I think over all workers in the economy, the effect is pretty close to zero. When you talk about high school drop outs that’s the one place where immigrants have swelled the ranks of the non-high school graduate workforce. In that sector, I would say the longer term impact is somewhere in the range of zero to five percent in terms of reduced earnings associated with the presence of immigrants.

Gersh: What about the reduced ability to get a job?

Holzer:
Our economy usually adjusts and people can find jobs. I think the issue is what does it do for the wage levels of different groups. And when some of those wages get bid down, some groups decide it’s not worth entering the labor market at all.

Gersh: How do low-skilled workers avoid competing with immigrants?

Holzer:
The vast majority of them live in states where there aren’t a lot of immigrants to compete with. But in places like LA or Texas or New York where there are a lot of immigrants, they end up going to other sectors of the economy. Usually their wages are a little better when they try to find work in those occupations.

Gersh: So they might go into retail as opposed to low-end manufacturing?

Holzer:
That’s right.

Gersh: We’ve always had immigrants in the workforce. What’s different now?

Holzer:
The presence of immigrants has grown over the last few decades. We changed our immigration laws in 1965. By 1970, the immigrant flow started to pick up. And certainly in the last few decades it’s picked up a lot more. So there are more immigrants now. And there is some evidence that their skill levels, their education levels are further below the average than might have been true a century ago. And that means they lag behind the average worker more. It’s a big pool of unskilled labor which may mean more competition for the people in this country who have similar credentials.