May 2007 SGE Monthly Luncheon

“Assessing the Impact of Illegal Immigration: Education Matters”

Review of Remarks by Steven A. Camarota, Research Director at the Center for Immigration Studies

Rapporteur: Paul Cullinan*

At the May SGE luncheon, Steven Camarota presented some of his work on the characteristics of illegal immigrants and the likely implications of such immigrants on U.S. labor markets and the economy. Coinciding with the Senate debate on comprehensive immigration reform, the talk was a timely presentation on one of the most controversial subjects addressed in the legislation.

Camarota began with a review of the historical immigration patterns observed for the U.S. highlighting the surge in the foreign-born population in the late 1800s and early 1900s, the restrictive immigration policies of the 1924-1965 period, and the rapid growth since then. Not only did the policy become less restrictive with the 1965 legislation, it also altered the characteristics of the types of immigrants admitted. Since 1970, the immigrant population has fallen further and further back relative to the native-born population in economic status, a trend Camarota attributes to the lower levels of educational attainment of the recent migrants. (He reported that in 1970 the average education level of the foreign-born population actually exceeded that of the native-born population.)

The characteristics of the illegal population are even more differentiated from U.S. natives. Roughly 3 in 5 illegal immigrants have a less than high school education compared with fewer than 10 percent for U.S. citizens. Camarota argued that this single characteristic is the factor that explains the adverse fiscal impact of the illegal population. He estimated that illegal immigrants constituted a net cost to the federal government of about $10 billion annually and legalizing this population would nearly triple those costs. Thus, it is not the legal status of this population that is the cause of the fiscal impact, it is the education background of those immigrants that is the determining factor.

So, are these illegal immigrants helping the U.S. economy by filling gaps in the labor market where the demand for workers exceed the supply? Camarota finds little evidence to support the notion that there is a shortage of low-skill workers. With wages stagnant or declining for workers with less than a high school diploma, offers of fringe benefits for such workers falling, and 23 million lesser educated native either unemployed or out of the worker force, how can one argue that there is a shortage? Wouldn’t one expect tight labor markets to boost wages and benefits?

An alternative to legalizing the current unauthorized population is more vigorously enforcing or strengthening existing law and encouraging those workers to leave either voluntarily or by removal. Strong employer sanctions, strict employment verification measures, additional interior enforcement agents, and more detention space would be important components of a strategy to hasten out-migration. Inflows could be reduced by hiring more border patrol agents and installing more fencing and sensors along the border.

Camarota summarized his presentation by emphasizing that the nation does not benefit from high levels of immigration by less-educated workers, and by arguing it is not good policy to depress the wages of native low-skill workers by admitting large numbers of similar workers. While work in the U.S. clearly benefits the migrants themselves, U.S. policy should be structured to “do what’s in America’s best interests.” 

* The analysis and conclusions expressed in this summary are those of the author and should not be interpreted as those of the Congressional Budget Office.