Sunday, January 27, 2019

Do International Migrants Reduce Wage Growth? Legal Immigration is a Plus

Politicians and pundits have battered Americans with claims and counter-claims regarding the impact of immigration on American wages. Wage data from the U.S. Census Bureau and Bureau of Labor Statistics for 381 metropolitan areas between 2013 and 2017 show a clear positive relationship between legal immigration and wage growth.

In terms of the percentage of legal international migration, the top one-fifth of metros in terms of immigration gains experienced wage increases of 10.4% ($4,329) for all workers, 13.4% ($11,763) for management, and 15.6% ($3,284) for food service workers. The one-fifth of metros experiencing the lowest immigration gains experienced wage gains of 7.4% ($2,870) for all workers, 4.1% ($2,425) for managers, and 10.0% ($1,987) for food service workers.

Legal immigration was supportive of higher wage growth between 2013 and 2017 (see Data in Table 1).

Statistically speaking, correlation coefficients show a positive relationship between percent of population growth from immigration and wage expansion for all occupational categories examined.

Contrary to expectations, the strongest positive relationship between immigration and wages was for low wage occupations. Unfortunately, today's debates regarding illegal immigration on the U.S./Mexico border undermine legal immigration and economic growth, other factors unchanged.

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