and wages in food processing:
Figure 1: Foreign born labor force (nsa) as share of civilian labor force over 16 (sa) (blue, left scale), and real wage in nondurables manufacturing – food, in 2022$ (tan, right log scale). Uses chained CPI seasonally adjusted using X13. NBER defined peak-to-trough recession dates shaded gray. Red dashed lines at Trump administration. Source: BLS, NBER, and author’s calculations.
I chose food processing wages (food processing) because it was in one of the sectors with the highest proportion of foreign born labor (nondurables overall, and specifically), and at the same time highest job vacancies in 2021.
Source: Peri, Zalour, EconoFact (2022).
As the trend in foreign born in the labor force has been re-established, the relative wage was come back to trend.
For comparison, here are nondurables and food services real wages over time.
Figure 2: Real wage in nondurables manufacturing – food, in 2022$ (tan), in nondurables manufacturing (light blue), in hospitality and leisure – food services (green). Uses chained CPI seasonally adjusted using X13. NBER defined peak-to-trough recession dates shaded gray. Red dashed lines at Trump administration. Source: BLS, NBER, and author’s calculations.
The surge in real food processing wages relative to trend seems to coincides with the shortfall.
So, at least part of the inflationary pressures of 2021-22 can be attributed to the policies of the Trump administration, with respect to immigration/border policies, as well as the implementation of Title 42 (public health measures).
Agricultural (in the field) worker wages are not in Figure 2, unfortunately. Here is annual data, from a different data set.
Source: USDA.
The impact of the immigration shortfall on the low wage labor force is only part of the story. For other implications, see Peri and Zaiour (2022).
Yes, but, we all know – because faux news tells us so – that immigrants are a burden on “the system”. That burden is perfectly obvious when comparing the overall unemployment rate to the rate among immigrants:
https://fred.stlouisfed.org/graph/?g=1cbip
Wait a minute…, I’d better try again. What I meant to say is that immigrants place a burden on the Social Security system. Just look at this:
“In 2010, the Social Security Administration estimated that immigrants contribute $12 billion more to the Social Security System than they take out, especially because they don’t have access to the same benefits that legal migrants and natural citizens do.”
(https://finance.yahoo.com/news/20-states-highest-migrant-workers-140221099.html?guccounter=1&guce_referrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&guce_referrer_sig=AQAAAIBzQXZztb4Yf3JQefTldTR5RKKxuGvlFdI9b0hFYVs10WkABl47xgQOUoWCgDyh9iwxsTKs-7d9A3BmwqPaiG0f9eWOL2a2O-yckxN-no0LP7s6JNEdgCBa0quJp0VCpR56szFyQinZGHXzZCNV5wd6W6RlhkvHDiaODh74LkmN)
Wait…,what I meant to say is, it’s the CRIME! Just look!:
“As a group, immigrants had higher incarceration rates than US-born white men before 1870, similar rates between 1880-1950, and lower rates since 1960. Although there are substantial differences in incarceration by origin country, the relative decline in incarceration since 1960 occurred among immigrants from all sending regions.”
https://www.nber.org/papers/w31440
But in Texas at least, where a great deal of effort goes into roundng up those dangerous immigrants, the need is absolutely clear:
“Relative to undocumented immigrants, US-born citizens are over 2 times more likely to be arrested for violent crimes, 2.5 times more likely to be arrested for drug crimes, and over 4 times more likely to be arrested for property crimes.”
https://www.pnas.org/doi/10.1073/pnas.2014704117
F%$# it! I know what I know.
Immigrants are bad, I know
Because faux news tells me so
They bring crime and death and woe
The fact say “stay” but they must go!
Yes, faux news tells me,
Yes, brightbart tells me,
Steven Miller tells me
The facts say “stay” but they must go!
(Music by William B. Bradbury. Lyrics by a oversized water fowl.)
By the way, immigrants to the U.S. prior to 1870 were mainly voluntary immigrants from Western Europe, including the British Isles, and slaves from Africa. After 1870, Southern and Eastern Europeans dominated the immigrant flow to the U.S. until around 1910, when Mexican immigration rose in reaction to civil wars at home. In 1921, the National Origins Formula got the idea of national quotas started.
Anyhow, the timing of immigrant criminality suggests its the Europeans you need to worry about.
‘at least part of the inflationary pressures of 2021-22 can be attributed to the policies of the Trump administration, with respect to immigration/border policies, as well as the implementation of Title 42 (public health measures).’
Nicely said. It is odd that the MAGA hatters complained bitterly about the high cost of food never tying this back to Trump’s racist policies. Too easy to blame Biden I guess.
Wow – excellent analysis and reporting! – why are the Washington Post and NY Times not giving us reports like this – instead of getting a couple of quotes from GOP operatives telling us “the price of groceries is sky high” (also – one of my favorite data points in this is the one Macroduck highlights – ““In 2010, the Social Security Administration estimated that immigrants contribute $12 billion more to the Social Security System than they take out, especially because they don’t have access to the same benefits that legal migrants and natural citizens do.”” – this never gets mentioned by the GOP)
Also – for my day job in Wisconsin – I work with individuals with disabilities and attend several caregiver conferences and for several years have been hearing about the “lack of caregivers crisis” in Wisconsin – anecdotally, I’ve interacted with several foreign born front line care givers – I wonder if a similar dynamic is occurring in the front line care giver field? But – oh gee whiz – I get an extensive report about the crisis in paying for long term care for older adults in the NY Times – but very little about what is driving those costs – https://www.nytimes.com/2023/11/14/health/long-term-care-facilities-costs.html
IMO – we urgently need to be building bridges – not walls – and encouraging foreign immigration with common sense immigration policies to grow our aging domestic workforce – https://www.brookings.edu/articles/new-census-projections-show-immigration-is-essential-to-the-growth-and-vitality-of-a-more-diverse-us-population/ (I won’t go into details – but all this is especially true in Wisconsin.)
Thanks Menzie for your work.
Beautiful data that gets way too little attention in the Main Street press.
Immigrants are the pillars of our society not a burden.
For the longest time GOP managed to use the basic “territorial invasion” instincts of us “monkeys in clothes” to scare people – yet at the same time make sure their rich puppet masters could use illegal immigration to keep wages down by refusing to do anything about that presumably existential problem. We need the immigrant but the GOP don’t want them to be legal (and protected against gross exploitation).
‘Agricultural (in the field) worker wages are not in Figure 2, unfortunately. Here is annual data, from a different data set.’
This chart suggests that this nominal wage is about 2.6% what it was 20 years ago. Of course the consumer price index is about 2.1 times what it was 20 years ago. So real wages have grown by about 25% over the past 20 years.