January 22-23, 2015: Frontiers of Immigration Research

January 22-23, 2015

The Gifford Center co-sponsored a January 22-23, 2015 conference, Frontiers of Immigration Research, that involved over 150 participants and 25 speakers discussing topics ranging from the economic effects of immigration in the US to the effects of migration on the development of migrant-sending countries.

Economic Impacts

Economists have debated the effects of immigrant or foreign-born workers on native workers for decades. The conventional wisdom is that the half century pause in immigration to the US between the 1920s and 1970s put upward pressure on the wages of US workers. Since the 1970s, when the number of legal and unauthorized immigrants began to increase, economists have debated what role low-skill migrants play in low labor force participation and slowly rising wages for similar US-born workers.

For example, much of the increase in the number of US workers who have not graduated from high school over the past three decades is due to the immigration of Mexicans and Latin Americans. How do these migrants affect US-born workers who did not complete high school?

Economic theory suggests that the migrants should reduce the wages and job opportunities of similar US workers, which is what some economists find.  The number of US workers with less than a high-school education rose by a quarter between 1990 and 2010 due to immigration, and Borjas, who believes that 25-30 year old less-than-high-school migrants are substitutes for similar US workers, finds that wages for such workers fell by over six percent due to this migration.

Borjas emphasizes that dividing workers into five education and eight age groups creates 40 cells and 1,600 potential interactions between migrants and natives, so that models of migrant-native interactions are forced to make simplifying assumptions that help to dictate their results. For example, if the education group is high-school education or less, the group of US workers is much larger than if the group is only those without a high-school diploma. The impacts of migrants are diluted as size of the native group increases.

The US economy has grown significantly between 1970 and 2010. Peri plotted economic indicators for natives, such as the change in wages or employment, against the change in immigrants in the 722 labor markets or commuting areas across the US. He found positively sloped lines, that is, larger increases in immigrant stocks are associated with more wage and employment growth for natives in most of these labor markets.

There are several explanations for this seemingly counter-intuitive result, including the fact that migrants move to opportunity, or to California rather than West Virginia. It may be that California’s economy is better poised for growth than West Virginia’s, and that structural factors rather than immigration explain the wage and employment growth.

Peri tried to control for such structural differences between areas and still found that larger increases in immigration are associated with higher wages and faster employment growth. He offers three explanations for this result. First, migrants are not substitutes for natives, even those of similar age and education. Second, businesses adjust to the labor supply that is available, so that if there is an influx of low-skilled migrants, firms make adjustments to hire them. Third, the diversity that accompanies immigration may have positive spillover effects on productivity and innovation, so that areas with migrants grow faster.

The spillover effects of migrants are most expected for high-skilled foreigners, those with college degrees or more. The US receives more college-educated immigrants and temporary workers than any other country, but they are a smaller share of all immigrants in the US than in Canada, which uses a point system to select migrants. Many studies find that areas with more college-educated immigrants have higher rates of patents and other measures of innovation, but it is not clear whether this reflects the composition of immigrants, many of whom are scientists and engineers, or their innovativeness.

Most Americans support accepting more high-skilled migrants, including foreign students who graduate from US universities. Many land-grant universities are accepting more foreign undergraduate students who pay full tuition to compensate for less state support. Those that can attract out-of-state US students, such as UCB, have taken fewer additional foreign undergraduates than others, such as UCD.

Immigrant Integration

How well do immigrants and their children integrate in the US? The US prides itself on its ability to integrate foreigners, as reflected in the motto e pluribus unum, or from many peoples come one people, Americans. The major finding of those who study immigrant integration is that living in the US integrates immigrant children, who lose their parents’ language by the third generation, when most identify themselves as Americans rather than identify with the country of their grandparents’ birth.

There are significant differences between the immigrants and their integration settings at the beginning of the 20th and 21st centuries. First, the economy has changed in ways that benefit the well-educated and hurt the low-educated. Second, multiculturalism is more accepted today than a century ago, when schools often discouraged immigrant children from speaking their parents’ language. Third, the continued arrival of newcomers in migrant areas can make it appear that those who are in the US longer are not integrating, even when they are. Finally, a majority of immigrants today are racial minorities, a sharp contrast to immigrants a century ago.

Asians are often considered model immigrants, lauded for their success in education and income. Most Asian immigrants are well educated, selected from the upper rungs of the education ladder in their countries of origin, while many Latin American immigrants have little education, often less than the average for those in their country of origin. Second-generation Latin Americans in the US often have more education and income than their parents but less than US-born youth, reflecting the fact that their parents often have only seven or eight years of schooling.

The largest group of Asian immigrants are Chinese, who stand out as being very successful in the US. This success reflects high levels of parental education and expectations in the US, so that US teachers expect Asian students to do well in school and many Asian students rise to the occasion and do well. Even Asian immigrants whose parents have little education expect their children to earn advanced degrees, and Asian youth in the US often compare themselves to other Asian-Americans rather than their white, Black, or Hispanic peers.

Migration and Development

How does the emigration of skilled workers and professionals affect the developing countries they leave? Worries about the brain drain, according to Clemens, are overblown, since the data suggest that if some professionals emigrate, more are trained to replace them. For example, in the two decades after a 1986 coup in Fiji that disadvantaged the half of the population of Indian origin, a third of Indians emigrated, mostly to Australia and New Zealand, yet Fiji had as many college graduates as before, a result attributed to more Fiji residents realizing that it was easier to emigrate with a college degree.

Migration from poorer to richer countries is seen as both an obstacle and an opportunity to development, defined as sustained and broadly shared economic growth. Over the past decade, most development agencies and many governments have seen migration as opening a window for faster development, and remittances from richer to poorer countries have become a shorthand indicator of migration’s potential to speed up growth.

However, there is no automatic link to ensure that more migration is linked to faster development. There are examples of countries that sent workers abroad in one period grew fast and imported workers in the next, such as Italy and Korea, and there are examples of rising emigration over time, including Jamaica and the Philippines. If a country is primed for development, migration, the disapora, and other factors can speed growth. However, if a country is riven by corruption and conflict, migration and remittances can fuel rent-seeking and civil war that slow development.

There are 47 countries with less than 1.5 million residents, including many Pacific Islands. Australia and New Zealand accept immigrants from Pacific Islands and recruit seasonal farm workers there. Careful studies of Tonga’s best high-school graduates in Tonga found that 85 percent emigrate, but two decades later only half were out of the country, suggesting many returns for family and other reasons. The returnees had about the same earnings as similar Tongans who did not emigrate, suggesting that higher earnings abroad were due to improved infrastructure there, not purely individual human capital.

The NZ RSE allows farmers to recruit workers in Pacific Island countries for up to seven months.  Surveys show that the migrant workers earn more, spend more in Tonga, and save more. Even though only two percent of Tonga’s 100,000 residents have participated in the RSE, the net economic gain estimated to be $5 million, is equivalent to almost half of the value of Tonga’s exports, $11 million.

About 70 percent of US farm workers were born in Mexico. Taylor, who has been surveying rural Mexicans for a decade, says there are fewer rural Mexicans who are willing to do farm work in the US.  Rural Mexican families are smaller, more children are staying in school, and there are more nonfarm jobs available closer to home, which discourages many rural youth from making an increasingly dangerous and expensive trip to the US to do farm work.

Farm work is a job rather than a career for most farm workers, so that many move on to nonfarm jobs after a decade in the fields. The Deferred Action for Parental Accountability (DAPA) and the Deferred Action for Childhood Arrivals (DACA) programs may speed exits from agriculture, since legal status tends to increase worker mobility in the US labor market.

US farmers would like a new guest worker program that ended requirements to try to recruit US workers before receiving permission to hire legal migrants, to allow migrants to find their own housing, and to reduce the required minimum wage that must be paid to guest workers. Such a new program would likely allow dairy and other farms that offer year-round jobs to hire guest workers and, under most proposals, guest workers would be allowed to stay in the US up to three years, which could justify recruiting in Asia rather than Mexico.

If farmers fail to persuade Congress to approve such a guest worker program, farm wages are likely to rise, prompting mechanization, mechanical aids to make farm work easier, and crop changes. Crops that are profitable but hard to mechanize such as strawberries may offer benefits to develop a stable corps of seasonal workers.

Migration Policy

The US accepts 1.1 million immigrants a year and has 43 million foreign born residents, about 20 percent of the world’s global stock of 232 million international migrants. The major issue over the past two decades has been what to do about 11 to 12 million unauthorized foreigners, over half Mexicans.

The ongoing debate over what to do about unauthorized immigration is framed by the extremes of enforcement and legalization. So-called restrictionists want more done to stop unauthorized migration, including make life so difficult for unauthorized foreigners in the US that they "self-deport." Admissionists, on the other hand, believe that unauthorized foreigners who have developed an equity stake in the US via work or US-born children should be eligible for immigrant visas and eventually US citizenship.

Enforcement and legalization were combined in so-called comprehensive immigration reform bills approved by the Senate in 2006 and 2013. However, the House, with a corps of enforcement-only members, refused to act, prompting frustration among migrant advocates.

President Obama in 2008 promised to propose immigration reform in his first year in office, but instead tackled the 2008-09 recession. In a bid to win Republican support for comprehensive immigration reforms that included a path to citizenship for unauthorized foreigners, Obama stepped up enforcement of immigration laws, earning the title "deporter in chief" for 400,000 removals a year.

Obama resisted taking administrative action to protect some unauthorized foreigners in the US until 2012, when the Deferred Action for Childhood Arrivals (DACA) program allowed unauthorized foreigners who came to the US before the age of 16 to apply for a lawful presence status and work authorization. In November 2014, Obama expanded DACA and announced the Deferred Action for Parental Accountability (DAPA) program, an executive action to allow an estimated four million unauthorized foreigners whose children are US citizens or legal permanent residents and who have lived in the US at least five years to apply for renewable three-year deportation deferrals and work permits.

There is little prospect of enacting comprehensive immigration reforms until 2017, after elections in 2016. Meanwhile, some advocates believe that incremental or building block reforms can be enacted, such as more H-1B visas, an easier path for foreign graduates of US universities to stay and work in the US, and perhaps new guest worker programs for agriculture. Meanwhile, DACA and DAPA recipients and their families will become better established in the US, so that the defacto policy of the US will be to allow foreigners who do not come to the attention of the authorities to settle.

Without open borders, immigration systems accept some and reject others. Most economists favor shifting away from the current US selection system, which selects a sixth of immigrants for employment reasons, and toward the Canadian system, where over half of immigrants are selected for employment reasons. However, unless the number of immigrants admitted increases, accepting more employment immigrants would require a reduction  in family immigrants, which many groups oppose.

Resolving such trade offs is a challenge. The Jordan Commission in the mid-1990s was the last major effort to explore migration trade offs, and its recommendations that family migration be reduced and employment migration be increased was rejected by Congress. It may be that the status quo remains the second-best solution for partisans who cannot achieve what they really want from immigration.

First Day

8:45: Welcome
9:00-10:30: The Economic effects of immigration
George Borjas (Harvard University)
Christian Dustmann (University College London)
Giovanni Peri (UC Davis)

10:30-10:45: Coffee break

10:45-12:00:  Foreign Scientists and Students and US education
William Lincoln (Johns Hopkins)
John Bound (U of  Michigan,)

12:00- 1:00: Lunch

1:00-3:00: Is the second generation integrating?
Ruben Rumbaut,(UC Irvine)
Philip Kasinitz (CUNY)
Jennifer Lee (UC, Irvine)

3:00-3:15: coffee break

3:15-4:45: Round Table: Asian and Latin American immigration
Erike Lee (U of Minnesota)
Natalia Molina, UCSD
Rose Cuison Villazor, UCD
Gabriel “Jack” Chin, UCD
Leticia Saucedo, UCD

Second Day

8:30-10:30: Migration and sending country economies
Michael Clemens (Center for Global Development)
Hein de Haas (IMI, Oxford University)
David McKenzie (World Bank)
J: Ed Taylor (UC Davis)

10:30-10:45: coffee break

10:45-12:45, Origins and Consequences of Migration Policy
Roberto Gonzales (Harvard)
Cecilia Menjivar (Arizona Sate University)
David Fitzgerald (UCSD)
Marc Rosenblum (MPI)

12:45-1:30: Lunch

1:30-3:30: The next 20 years of migration policies
Philippe Legrain (Autor, The European Spring)
Manolo Abella, (COMPAS)
Kevin Johnson (Dean, school of Law)
Tim Kane (Hoover Institution)

3:30-4:00: Concluding remark from UC Davis Chancellor Linda Katehi