"Work In Progress"-Immigrant Impact
Thursday, May 18, 2006SUSIE GHARIB: President Bush toured the nation`s southern border today, talking about his plans to station National Guard troops there. But immigration is no longer just an issue along the border. In recent years, immigrants -- both legal and illegal -- have fanned out across the country, bringing changes from the southeast to the nation`s heartland. Tonight, as we continue our series "Work in Progress", Darren Gersh looks at how immigrants are remaking labor markets in the Midwest.
DARREN GERSH, NIGHTLY BUSINESS REPORT CORRESPONDENT: For 30 years, Ed Schau ran the only shoe repair shop in Denison, Iowa.
ED SCHAU, COBBLER: This is the old home of Ed`s Shoe Service.
GERSH: Ed`s father was a cobbler, and so was his father`s father. Today, if you want to fix your heels in Denison, the sign in Ed`s shop directs you to head down the block to Tienda Vaquera. Inside, you`ll find Rogelio Cabrera. Ed sold his shop to Rogelio and agreed to teach him the trade.
SCHAU: Rough it up just a little bit. The first time I asked him, he said, "no, not ready yet."
GERSH: Ed spent two years looking for a buyer, and is glad he finally found Rogelio. SCHAU: Well, it means a lot. My wife and I talked about it, and she said that if we can`t find anyone, we`re going to lock it up. And I said well I`d sure like to keep a shoe repair shop in town, you know.
GERSH: Denison is the birthplace of Donna Reed, Jimmy Stewart`s co- star in "It`s a Wonderful Life", and immigrants like Rogelio agree. He came to the United States illegally in the 1970s, but now has his green card. He says it was important that Ed trusted him enough to sell him the business.
TRANSLATION OF: ROGELIO CABRERA, OWNER, TIENDA VAQUERA: I think he saw that I was honest and did all that he could do in order for me to be able to stay with the shop. It`s just incredible finding people that this good.
GERSH: If it weren`t for immigrants, a lot of businesses would be leaving Denison. Here along Broadway and Main Street, most of the new shops and restaurants are Latino and so are most of the city`s new workers. Denison Mayor Nathan Mahrt says immigrants have revived the city`s downtown.
MAYOR NATHAN MAHRT, DENISON, IA: They`ve done a lot to sort of help us believe in ourselves as far as our sustainability, because we look like a younger community now and we are a younger community now.
GERSH: Denison is the birthplace of the modern meatpacking industry, but now most of these workers weren`t born in Iowa. Fifty seven percent of the workers at this Farmland Foods plant are Latino. The company is now expanding and says having a larger pool of workers allows it to run more shifts and pack new products, including pig stomachs, a strong seller in China.
TODD GERKEN, GENERAL MANAGER, FARMLAND FOODS: We are able to do more product lines, which in turn adds more products that Farmland can offer the customers and which, in turn, adds to economic stability for Farmland.
GERSH: With an aging population, Iowa is facing a looming labor shortage that has made it eager to attract immigrants. The state is so eager, it`s opened new Iowan centers to help immigrants find jobs. Illegal workers are referred to immigration attorneys so they can become legal. It`s a different approach than in neighboring Minnesota, where the governor and many lawmakers are trying to crack down. Minnesota state Representative Jim Knobloch says he`s hearing more and more complaints from voters about illegal immigrants. REP. JIM KNOBLOCH (R) ST CLOUD, MN: In terms of the pressures of illegal immigrants being seen as much more the backbone of the work force, I think that we have seen a sea change in that in the last five years.
Reporter: The impact is strongest in construction. Nationwide, as many as 30 percent of the roofers and dry wallers are illegal immigrants. Will Sorlien says his income is down one-third because of immigration. He first noticed the change coming to Minneapolis seven years ago.
WILL SORLIEN, DRYWALLER: I can`t have any hostility towards those people, but the problem is they are illegal and it`s creating a new, a new labor pool. I guess, call it the new American business plan, if you want. Except the new American business plan is really an old concept. It`s called divide and conquer, you know? You are pitting the newcomers against the lower classes. Or what am I? Am I middle class? I don`t know anymore.
GERSH: It`s a question many native-born workers are asking. Most economists argue the impact of immigrant labor is concentrated in a handful of industries and, because immigrants tend to be low-skilled, they compete most directly with native-born high school drop-outs. Even there, the estimated long run impact on wages is surprisingly small, reducing paychecks by no more than 5 percent and cracking down on immigration may not make much of a difference.
HARRY HOLZER, PROFESSOR OF PUBLIC POLICY, GEORGETOWN UNIVERSITY: The data shows that when immigrants aren`t available, most employers don`t really bid wages up. They just bring in more machinery to do what otherwise workers would have done, or they might open fewer businesses in exactly that line of work.
GERSH: But immigration does change the mix, creating competition for some and cooperation for others. Darren Gersh, NIGHTLY BUSINESS REPORT, Denison, Iowa.
GHARIB: Our special series "Work in Progress" picks up again on Monday. Darren looks at how one employer in Wisconsin is creating a new type of career ladder to end a labor shortage.
