The recent focus on immigration has provided an opportunity to knock down several prominent myths about the issue — that mass deportation of 12 million people is a feasible solution; that hardline “enforcement-only” proposals will actually reduce illegal immigration; or that undocumented workers don’t pay taxes.
Another common misperception is that increased immigration has had a negative impact on wages for lower-skilled U.S.-born workers. But as Princeton University professor Alan Krueger shows in a new American Progress memo, the actual impact of immigration on lower-skilled workers is negligible. Why?
One likely factor is that, in addition to increasing the supply of labor, immigrants increase the demand for goods and services produced in the U.S. This leads to higher wages and employment for all workers in the U.S. Immigration can also result in an increase in capital investment. And many immigrants become entrepreneurs, creating jobs for other immigrants and natives. (The latest U.S. Census data shows that “Hispanic-owned businesses now comprise one of the fastest-growing segments in the U.S. economy.”)
As Krueger writes, if we are serious about helping low-income workers, we need to act now on measures that can have a much larger impact, like “an expansion of the Earned Income Tax Credit, an increase in the child tax credit, a boost in the minimum wage, and increased job training.”