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Language, Skills, and Distribution

Reader query:

Re: Bargining Power. A new flow of higher skilled individuals, check. Prefer low-skill Hispanophones to low-skill Anglophones? Why?

I may have put this poorly. It’s not that I per se prefer immigrants from Mexico to immigrants from the Bahamas as that I’d like to navigate the ever-sticky politics of the immigration issue. Many people worry about the impact of immigration on the wages of native workers. And people aren’t so much wrong about this as they are misestimating its scope. Human beings are not an undifferentiated mass of labor. Nor do people even slice simply into undifferentiated masses of “has a bachelor’s degree” and “doesn’t have a bachelor’s degree.” Doctors and architects are both college educated, but an influx of doctors doesn’t reduce wages for architects. An influx of doctors could reduce the wages of doctors, but that’s equivalent to saying it raises the real incomes of everyone else.

By the same token, you often can’t substitute someone who doesn’t speak English for someone who does. An increased flow of Hispanophone busboys increases demand for Anglophone waiters. Which is to say that the people negatively impacted by high levels of immigration from Latin America are people who are very similar to the immigrants, people with little education or ability to speak English. It would be interesting if what was happening in America is that recent immigrants were loudly demanding an immigration crackdown, but that’s not what’s happening (perhaps because people recognize that their bilingual children will benefit from a continued flow, or perhaps because immigration politics is really about identity). So it’s important to try to get the Anglophone people who are complaining to better understand that we’re benefitting from the increase in overall economic activity associated with the influx of people with complementary skills. Given the difficulty of doing that, it would be a mistake to understake some hypothetical new initiative to bring in a bunch of new workers who really would compete with native born low-skill Anglophones.

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Higher-up the skill ladder, skills get more differentiated and the problem really goes away. Letting in more architects would be bad for architects, more doctors would be bad for doctors, more lawyers would be bad for lawyers, etc., but if we let in more professionals across the board then everyone would benefit since lawyers need health care and doctors need legal advice, etc.