So Matt countered my (slightly snotty) argument regarding the actually deleterious impact of undocumented workers on the wages of construction workers in the basic trades with his own (slightly counter-snotty) post that he "lives in the world in which we address complicated questions with scientifically valid research methods." He then continues to rely entirely on this paper by a University of Chicago economist that is, to put it kindly, abstract in the extreme, to support his assertions. My actual day to day experiences with the phenomenon are evidently not complex enough.
A couple of thoughts -- one, at the risk of sounding slightly anti-intellectual, I am really not one to subscribe to every bullshit theory that comes from the Economics Department at UChicago. It seems to me that if these folks were right about everything, we would be enjoying an era of unprecedented prosperity following thirty years of right wing economic policy. Second, as bright as I think Yglesias is, I doubt very much that he has fully read and understood Professor Cortes's paper. (Or perhaps I'm projecting.) In other words, I think he is relying on an authority whose conclusion he agrees with to support an argument that he really has no experience with nor expertise in. We all do this from time to time I suspect, but it doesn't really impress me.
Matt really addresses my rhetoric and not my underlying argument, which is based on actual, ugly confrontations with the reality of a specific market place. He also seems to misunderstand the nature of the group that I am addressing here -- they are not low-skilled, low wage, high school dropouts, but rather skilled workers who are typically high school graduates who have gone through a three or four year apprenticeship program. They have also enjoyed pretty respectable hourly wages and benefits. And their wages appear to be ready to crater as a result of unscrupulous employment practices that take advantage of undocumented workers.
Now I am not basing this on an amateur's observations or a dilettante's speculations. As I noted in the first post, I have just been through a process over the last year in which three different collective bargaining agreements were opened up mid-term -- a very rare thing -- in order to negotiate wage cuts, despite the fact that the employees had already secured modest wage increases for the remainder of the agreements. These cuts progressed, depending on when the negotiations took place, from the earliest to the latest from 7% to 12% to 30%. In all of these trade and geographic jurisdictions, the competition occurs from contractors employing a primarily undocumented work force. How do I know this? Well, for one, I've been involved in organizing campaigns at a couple of the employers where my clients were able to either win an NLRB election or get a majority of employees to sign cards, yet were unable to secure a contract. As I also noted, I've represented several non-union drywall installers in cases where they were being treated as phony independent contractors and not being paid overtime.
Additionally, my office represents hundreds of thousands of union members in all fifty states. We represent both the basic trades and the more highly skilled mechanical and electrical trades in a variety of places As a result, I have a pretty intimate knowledge of what market conditions are like in both of these realms and what the impact of competition from the undocumented workers has been like on the basic trades and how they have fared relative to their more highly-skilled brethren. Finally, my firm represents in some form or fashion the vast majority of building trades unions in the DC metropolitan area.
But evidently resort to my own experience is not enough and I need to be bolstered by PhDs with incomprehensible mathematical formulas (or is it formulae?).
Well, so fucking be it -- here is the abstract to the page turning paper "Immigration and Construction: An Analysis of the Impact of Immigration and Construction Project Costs." I laid out $30 for the actual paper -- curse you, you trust fund scumbag -- but there is no price too dear to pay in the interest of being proven right. I don't think I can post it here, however, without infringing on the rights of its authors. (I will email it to Matt.) The paper was produced by Sabrina Golden and Miroslaw Skibniewski, two academics at the Department of Civil and Environmental Engineering at the University of Maryland and prepared in order to address the possible effect on wages and project costs in the Washington DC metropolitan area if the amount of immigrant labor were dramatically decreased and employers were forced to hire native born workers as a result. The intended audience is construction executives. The paper was posted on February 4, 2010. It is, in sum, current, addressed to the specific labor market to which I was referring, and written in pretty clear language, fancy mathematical formulas notwithstanding.
Let me lay out in basic terms what the study finds without violating any fair use of the paper. The study finds that of the approximately 11 million illegal immigrants in the U.S., that 19% of them are working in the construction industry and that they comprise 14% of the overall construction work force. It further finds that in the basic trades in the Washington DC metropolitan region, i.e. "concrete, masonry, drywall, painting, flooring, and roofing are comprised of approximately 55% illegal immigrants." The paper also finds that nationally "illegal immigrants make up one-third of insulation workers, roofers, and drywall installers, and one quarter of all construction laborers, masons, painters, cement and concrete workers, and carpet and tile installers." These are pretty staggering numbers -- none of which are addressed by the Cortes study on which Yglesias relies. The authors note that the DC construction market has far more illegal workers than the national market and that, as a result this compounds "the immigration effect on workers' wages."
The study finds that only 80% of illegal immigrants are reported on the books, thereby sparing their employers a payroll burden of about 10.2% for workers compensation, Social Security, and Medicare. (My own experience is that this understates the recent explosive growth of characterizing such employees as "independent contractors" and issuing a 1099 Form to them rather than a W-2.)
Golden and Skibniewksi note that "[t]here is a popular argument that illegal immigrants do jobs that Americans won't do. . . . A more accurate argument is that Americans won't do certain jobs for the wages paid to illegal immigrants. Studies indicate that immigrant workers depress the wage market of the low-skilled occupations by approximately 11%. If the illegal immigrant work force dissipates, and employers are forced to hire native-born workers to do these jobs, the cost of labor will increase."
This was based on a construction industry unemployment rate of 11%. It has become far higher than that now. I have clients where unemployment rates are running at 40-50% right now.
I do not think it is desirable or practical to get rid of this work force. As I have argued (a point on which Matt and I agree), getting this group of workers into legal status and on a path to citizenship would alleviate much of this issue. One study suggests that a change in legal status would increase the wages of illegal immigrants by between 15 and 29%, depending on how long that they have been in the U.S.
As I noted in my comments below, I have been reluctant to even address this issue, given the ugly nativism and outright racism that characterizes much of the anti-illegal immigration crowd. I want no part of this and would never bash people who come here to try and improve their lives and provide for their families. But I also don't want to simply let pass the notion that there is no price being paid by working class Americans for policies that enable this kind of black market labor force. There is a real cost and it is a profound one -- one that threatens to become far worse in the current downturn.
If there is to be a liberal-left alliance that includes working class people, it helps not to blithely dismiss what they can clearly see with their own eyes.
