Archive for May 2010

Immigration and Unemployment

I was recently asked to give a presentation to a forum related to immigration. One of the participants, a government official, asked me how we can possibly justify the influx of immigrants, whether legal or undocumented, into the state of Michigan where there is already high unemployment.

The question reminded me of a study done by one of America’s prestigious universities and published in the Wall Street Journal some time ago. It analyzed the relationship between the number of immigrants entering the U.S. every year and the rate of unemployment. The study, which looked at data spanning many decades, found that periods of high immigration were also periods of historically low unemployment. The finding seems counterintuitive, but upon some reflection, it does make sense.

Immigrants coming to the U.S. not only occupy a job, but they also add to the consuming public. Therefore, they actually stimulate the economy. Accordingly, in evaluating immigration, we need to balance the stimulus effect added by immigration against the jobs that could have potentially been occupied by a nonimmigrant American. Almost all of the reputable studies that I have reviewed indicate that the balance is positive in favor of more immigration.

Another way to look at this is to ask one’s self: If I am unemployed and want to find a job, would I have a better chance finding a job in a crowded city such as New York, or in a rural, under-populated area? The intuitive answer is that there is a better likelihood of finding a job in a busy city. However, isn’t New York full of people that are all competing for jobs? Nonetheless, although many compete for jobs, the very existence of more people creates in and of itself, the need for more jobs.

I find it amazing that in a state like Michigan where we normally regret the departure of Michiganders to other states, we, at the same time, put hurdles in front of those who are willing to immigrate here. Of course, Federal law is also to blame for denying many talented foreign nationals and professionals the opportunity to immigrate. And even if some of those newcomers are not professionals, but merely escaping persecution, it will only be a matter of time before their children, just like prior generations, will grow up and help rebuild our state.

The conclusion may be ironic, but precisely because we have so much unemployment in Michigan and so many people are leaving the state, we need a new flow of immigrants to occupy our abandoned cities.

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