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Published Sunday, September 3, 2006 10:02 PM PDT
Business
Undocumented workers affect economy
That much is clear to the experts, but just how and what's good and bad about illegal immigration for labor is less so.
By Amanda Pennington

Studies show that illegal immigrants do affect the local economy, but experts agree it is far from being an easy-to-solve issue.

Costa Mesa has been a hotbed for the illegal immigration debate, with much of the rhetoric revolving around whether immigrants who come to California illegally are a drain on local economics and the job market.

"It's multi-faceted — there are some good things and under certain conditions, some negatives," said Frank Bean, a UC Irvine sociology professor who specializes in international migration, demography, racial and ethnic relations and economic sociology. "It's not hard to talk about these things, but it's hard for people to absorb multiple kinds of factors."

The question of whether illegal immigrants take the jobs of workers here legally seems misguided, he said.

"In normal economic times when there's reasonably good economic growth and — and the 'and' is important — reasonably good job growth, I think that immigrants — the unauthorized immigrants — are doing a lot of jobs for which there's not a lot of other available ready-to-work workers," Bean said.

When there's weak job growth, there's still not necessarily competition, Bean said, but when people are losing their manufacturing jobs it looks unfair that illegal immigrants are doing certain low-level jobs.

"A lot of these jobs pay so little that nobody else is really willing to take them, but what they do is suppress the wages for a lot of other people," said Kevin Klowden, a managing economist at the Milken Institute, an independent economic think tank.

"People on the lower end essentially find themselves competing for jobs if they're willing to take less money and that as a whole pushes wages down, but on the flip-side, the state recently … passed legislation to raise the state's minimum wage, which means that for legitimate workers, they get paid more, but on the other hand it's that much more of an incentive for businesses who want to keep the costs down to find ways to hire people who are going to cost less."

It's a question of cost — cost to the business, which directly affects wages and the price residents pay at the store or for services.

Getting rid of illegal immigrants in the workplace would pose an interesting situation for California, Klowden said.

"In California we have created an economy that functions with the assumption that illegal immigrants will be part of it," Klowden added.

With the rising costs of doing business, Klowden said, there is more focus on keeping costs down.

"There's more pressure on businesses that have to pay higher rents and higher costs, and you've got the fact that it's harder to get in to hire people above the board for a number of different jobs," he said.

Businesses in this crunch are more likely to hire temporary workers so they avoid paying benefits and other payroll costs, Klowden said. They also may not look too deeply into the worker's immigration status.

According to a study released in 2005 by the California Labor & Workforce Development Agency, "immigration provides net economic benefits to domestic residents, although some individuals may suffer losses of income."

Costa Mesa Mayor Allan Mansoor is among those who see the negatives to illegal immigration.

"Any time you have a large number of people coming here to work, it's going to suppress the wages," he said. "Americans are willing to do those jobs and are willing to work for a decent wage."

Part of the trouble with determining the effects illegal immigrants have on the economy is that they are obviously difficult to document.

"The unemployment rate is traditionally low and is still very low and anybody who wants a job can go find a job, so how can it be said that anyone is taking a job away from anyone," said Ed Fawcett, president and chief executive officer of the Costa Mesa Chamber of Commerce.

According to the California Labor & Workforce Development Agency study, foreign-born people are more likely to work in service, construction or production jobs than management and professional occupations. Illegal immigrants make up 19% of farming workers, 17% of workers in cleaning jobs and 12% of construction workers, according to the study.

Immigration falls under federal jurisdiction and if the employment laws were strictly adhered to or enforced, the lack of cheap labor would be reflected in the wallets of consumers.

"The main benefit to the economy that we normally see is that things cost less when there are lower wages," Klowden said.

The children of illegal immigrants — whether the children are citizens or not — are eligible for a kindergarten through 12th-grade education. In the short-term, studies and some experts agreed, this is a cost most absorbed by taxpayers. In the long-term, however, it could benefit the economy. As the children surpass their parents' education level, they can become more integrated into society and obtain higher paying jobs.

The job profiles of children or illegal immigrants tend to look more like the profiles of citizens, the labor study said.

"As each generation comes along, if people are properly educated they have a much better chance for advancement and that can benefit the economy," Klowden said. "The question is can they get integrated into the economy and into society in a legal fashion — if so, it benefits everybody."

The illegal immigration issue is not clear-cut, everyone tends to agree, but it seems the climate of the economy will be the judge of whether it has more of a negative or positive impact on citizens.

"That's the core of it in a way," Bean said. "It's not totally black and white, it's sort of part good and part bad and whether the balance of good outweighs the bad depends on the strength of job growth, which may not be a neat sound byte, but it's the reality."

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