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Abstract
While most evidence suggests that immigration has had a modest negative effect on black employment, especially for those without a high school diploma, changes in immigration law will probably not improve job prospects for young blacks, Senior Fellow Harry Holzer told the U.S. Commission on Civil Rights. He offered six suggestions for policymakers looking to improve outcomes for young African Americans, such as improving their early work experience and occupational training with high-quality career and technical education.
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Testimony
I would like to address the question of how immigration—whether legal or illegal—affects the labor-market opportunities and outcomes of native-born African Americans. In doing so, I would like to make several points.
- Most econometric evidence suggests that immigration over the past few decades has had a modest negative effect on the employment outcomes of blacks, especially those without high school diplomas.
The strongest evidence of negative effects comes from work by George Borjas, Jeffrey Grogger, and Gordon Hanson (2006). They find quite strong negative effects on the wages and employment of black male high school dropouts, somewhat smaller effects for high school graduates, and very small effects on incarceration rates for either group.1
This evidence is based on strong statistical assumptions and only considers the effects of immigration in the short run—in other words, before capital inflows have occurred that would mitigate the negative impacts of immigrants on native-born workers. Therefore, these estimates likely overstate any real negative impacts, though some of the estimates are already small.2
But newer papers have bolstered the notion that there are some negative effects. For instance, Deborah Reed and Sheldon Danziger (2007) also find some modest negative effects of immigration on the employment of black men, using a simpler methodology that compares outcomes across metropolitan areas. In an MIT doctoral dissertation, Christopher Smith (2008) finds somewhat larger negative effects on the employment rates of both white and black teens, but much more modest effects as they age into their 20s.3 These papers are significant because analysis of differences across metropolitan areas (by Prof. David Card of Berkeley and others) have traditionally found much weaker evidence of negative impacts of immigration.
(End of excerpt. The entire testimony is available in PDF format.)
The views expressed are those of the author and should not be attributed to the Urban Institute, its trustees, or its funders.
1 For instance, their estimates suggest that immigration between 1980 and 2000 reduced wages by 8.3 percent, reduced employment by 7.4 percentage points, but raised incarceration by only 1.7 percentage points among black male high school dropouts (among whom over 60 percent now spend some time in prison). The corresponding estimates for black male high school graduates are 3.2 percent, 2.8 percentage points, and 0.6 percentage points.
2 Borjas et al. (2006) assume a stable demand function over a 40-year period. They allow for only a limited number of shifts by education or experience but otherwise assume constant employment responses to wage changes over time and across groups. In a period when labor demand has shifted so dramatically against less-educated groups, some effects of demand shifts may be attributed in this work to immigrant-induced labor supply shifts. Also, capital inflows in the long run are expected to fully offset the higher supplies of immigrant labor on average, thereby also dampening any negative effects for particular groups. See Ottaviano and Peri (2006).
3 Reed and Danziger estimate that immigration over the 1990s reduced the employment of black males with or without high school degrees by roughly 1 percentage point and reduced their wages by 3.5 percent. Smith estimates that immigration over the past 15 years might have reduced teen employment rates by 5 percentage points overall and about 4 points for blacks, but these effects diminish quickly for young people over age 20.
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Disclaimer: The nonpartisan Urban Institute publishes studies, reports, and books on timely topics worthy of public consideration. The views expressed are those of the authors and should not be attributed to the Urban Institute, its trustees, or its funders.
