January 13, 2004

Immigration Boogeymen

Every time I hear about somebody raising the alarm about the irresistible tide of minimum wage workers that will drive all wages to near zero I remember a few lessons I've picked up over my years in the labor market

1. Low wage earners have no loyalty and will jump ship for the smallest reasons
2. You don't start to make money on a worker until he's been at work for some time, usually six months.
3. Employers actively steal employees from each other.

The idea that people will simply come in at minimum wage and bankrupt other businesses won't hold. There will be some downward pressure on wages but anybody who tries to hold the wage level too low will simply find out that he's become a money losing training facility for all his competitors. As soon as he trains a new worker up to a decent standard of competence, he'll lose him to a competitor for a few measly cents an hour. If that competitor doesn't watch it, he'll lose his newly acquired worker just as fast.

So wage rates will bounce around a great deal in the low skills sector and unskilled labor will continue to be under pressure but that's just the point. It isn't going to be some faceless horde of aliens taking away all jobs but rather a competitive pressure that native born workers can compete against and will hold their own. The benefit, which none of these immigration gloom and doomers note, will be a reduction in the ability of criminals and terrorists to take advantage of the great sea of illegal immigrants to hide among. We have to dry up the illegal papers market, the illegal immigration specialists whether coyote or snakehead. We have to do this or we may very well find ourselves being infiltrated and attacked through these routes.

There was a time when people complained that the general population was not called on to sacrifice anything for the War on Terror. Cleaning out illegal immigration is going to be a general sacrifice. My wages are likely to be lowered as much as anybody else's. But this isn't an intolerable sacrifice and we will gain a great deal in security and in tax revenue that used to slip through the underground economy. We shouldn't kid ourselves that increased immigration won't be uncomfortable. It is, however, necessary and survivable.

Posted by TMLutas at January 13, 2004 07:41 PM