The Economic Reality Of Tough Immigration Laws
Whatever you think about the immigration policy in the United States, there is clearly the law and then there is reality.
The immigration issue is often debated in terms of justice, rights and the protection of our borders, but there's a business story to be told as well. The question is: Can the U.S. economy really function without undocumented workers?
Gordon Hanson, an economist specializing in the impacts of immigration, studies the reality side of things at University of California-San Diego. He says that for decades there has been an unwritten social contract that says the U.S. isn't going to make it easy for immigrants to get in; there will be physical barriers and it will cost time, money and personal risk.
"What that did in effect was to select out people who weren't serious, to select out people for whom the opportunity of being in the United States didn't matter that much," Hanson tells weekends on All Things Considered guest host Robert Smith.
This policy was good for businesses and the workers who made it across the border. It created an ideal workforce of individuals focused on working, as long they were able to produce identification, valid or not, Hanson says.
There were flaws, but from a business point of view, this system was stable and predictable, Hanson says. Businesses could plan based on the reality of immigration enforcement. But tougher new laws in Alabama and Arizona changed all of that, amounting to what Hanson says is chaos.
"[It's] piecemeal reform undertaken at the state level with different states doing different things, making it harder for employers to hire illegal immigrants," Hanson says. "Employers just don't know what to think about what's going to come down the pike next."
That's what's happening on Jamie Boatwright's farm on Chandler Mountain in Alabama. His large variety of tomatoes are ripe and ready to pick, but there's a problem — no pickers. Most of Boatwright's usual workers left Alabama after the new immigration law went into effect in the state.
The law allows police to detain anyone they suspect of being an undocumented immigrant. Kids can't go to school without proving they are U.S. citizens. Many of the field workers in Alabama have fled to Florida, where there are fields with better work and no hassles. Boatwright says he never knows how many pickers will show up.
"It varies from day to day. Sometimes we have six, sometimes we have seven, sometimes eight," he says. "It just depends [on] their level of anxiety toward being able to come to work that day."
Why The Change
Republicans say the government should stop interfering in business and making life unpredictable for businesses. And yet, Republicans passed this law in Alabama and that's exactly what it does.
Alabama state Sen. Scott Beason, who sponsored the bill, says the status quo needed to change because businesses were being forced to hire undocumented workers if a competitor did so in order to keep their own business afloat.
"As they undercut the prices for their subcontractors, you begin to see people no longer in the drywall business, [it's] more difficult to be in the painting business, bricklaying or that sort of thing," Beason says, using the example of a construction company. "So over the years you end up with a big problem growing where more and more people hire more and more illegals."
Beason is now hearing complaints from local businesses that say it is difficult for them to hire workers and keep their businesses running, but he says that fixing any problem takes a period of adjustment.
"It is not going to be smooth and easy for every single person," he says, "especially if you've been out there basing your business, basing your livelihood, on breaking the law and hiring an illegal workforce."
Beason says the state did its job to warn businesses that the new law was coming and it is unfortunate that many businesses did not change the way they did business to get over the last few weeks of harvest. He also says, despite what some people believe, he thinks Americans are willing to do these jobs.
"There may have to be some differences in pay scale ... but Alabamians and Americans will do those jobs," he says.
The Wage Theory
Some economists theorize that without all those undocumented immigrants, the supply of labor will dry up and businesses will have to pay more to attract new, legal workers. Tomatoes end up costing more, but Alabama's 10 percent employment rate goes down.
But the theory isn't working so far at Boatwright's farm.
"Since this law went in to effect, I've had a total 11 people that were Americans come and ask for work," Boatwright says. "A total of one of those actually came back the next day."
That one worker picked about four boxes of tomatoes before leaving the field and quitting, Boatwright says. He says picking crops in the fields is a specialized skill that Americans just aren't accustomed to doing.
If Boatwright were to raise his wages in order to attract workers, he'd have to also raise the prices of his tomatoes. A price hike would not allow him to compete with the lower prices of tomatoes from neighboring states without tough immigration laws.
Boatwright's wife, Lana, says she fears how this will end.
"This problem is not going to go away for the state of Alabama," she says. "The farmers may go away from the state of Alabama, some of the industry may go away from the state of Alabama, but there's not a Band-Aid you can put on this to fix it quickly."
There is hope, however, but it requires an economic recovery.
"What we've seen after every U.S. recession ... is once the demand for labor really starts to pick up, what happens is those same politicians who were preaching a tough line on immigration suddenly get softer," says Hanson from University of California.
Hanson says these new laws are so tough, though, it may be difficult to go back — if the law stays in effect. The U.S. Justice Department has asked an appeals court to look at the constitutionality of Alabama's law.
ROBERT SMITH, host: This is WEEKENDS on ALL THINGS CONSIDERED from NPR News. I'm Robert Smith, in today for Guy Raz.
Up on Chandler Mountain in Alabama, it's harvest time. And every morning, Jamie Boatwright gets up early. By 6:30, he is out in the tomato fields waiting.
JAMIE BOATWRIGHT: Just seeing who all may show up to pick tomatoes that day.
SMITH: It's not a bad time of year to work outside.
BOATWRIGHT: It's a beautiful sunny day.
SMITH: Perfect temperature, 75 degrees.
BOATWRIGHT: Slight wind.
SMITH: And Jamie Boatwright says the tomatoes are ready, a nice pink orange glow, big ones the size of a softball.
BOATWRIGHT: Cherry tomatoes and also the Roma tomatoes.
SMITH: But there is a problem.
BOATWRIGHT: We've got plenty of all those different kinds of tomatoes and no pickers to pick them.
SMITH: The fields here are quiet. Most of the Boatwrights' usual workers have left Alabama, fled across the state line to Florida, too afraid to come out here and pick tomatoes. Late last week, a new immigration law went into effect in Alabama. The police can detain anyone they suspect of being an undocumented immigrant. Schools have to report the immigration status of their students. Life here on Chandler Mountain changed overnight.
BOATWRIGHT: Last week, we had 48 pickers at the beginning of the week. When the new law went into effect, we had eight.
BOATWRIGHT: And it varies from day to day. Sometimes we have six. Sometimes we have seven, sometimes eight. It just depends if, you know, their level of anxiety is towards being able to come to work that day.
SMITH: Level of anxiety, that's the crazy thing. Jamie Boatwright says they actually got special work permits for their undocumented pickers. But that didn't matter. The men got scared. Why take a chance getting picked up by the police? There are fields in Florida with better work and fewer hassles.
We called up Victor Spezzini in Birmingham. He is originally from Paraguay and now he's an organizer with the Hispanic Interest Coalition of Alabama. He says he saw the flight for the border firsthand.
VICTOR SPEZZINI: The mass exodus that began, really, all at one time was on September 28th, on that Wednesday. And at night, I had a family that's close to mine, and they left that same night at midnight with their children. And they gave their dogs away, and they were just weeping uncontrollably as they drove away. They wanted to be out of the state before the sun rose, before the law was in effect.
SMITH: We often speak about the immigration debate in terms of justice. Who has the right to be in this country? How far can you go to protect the borders? But there's an economic story here too. Can businesses really function without undocumented workers? That's today's cover story. Whatever you think about the immigration policy in the United States, one thing is clear, there's the law, and then there's reality.
Gordon Hanson studies the reality side of things at U.C. San Diego. He's an economist specializing in the impacts of immigration. Hanson says for decades, there has been an unwritten social contract.
GORDON HANSON: In which we said, we're not going to make it easy for you to get in. You're going to have to work hard, because there are going to be some barriers at the border. It's going to cost you some money. It's going to cost you some time. It's going to cost you some personal risks. And what that did, in effect, was to select out people who weren't serious, to select out people for whom the opportunity of being in the United States didn't matter that much.
SMITH: This is great for the workers who actually made it across the border because once they were here, they weren't hassled all that much. But it was also good for businesses, creating this ideal workforce.
HANSON: What we got out of that previous policy was a population of undocumented workers who were very focused on working. They had a higher employment rates that U.S. native-born workers.
SMITH: Sure, there were flaws. But Hanson says that from a business point of view, at least it was stable, it was predictable. You could plan a business based on the reality of immigration enforcement. The new tougher laws in Alabama and Arizona changed all that.
HANSON: And what we're getting now in immigration is just chaos, piecemeal reform undertaken at the state level with different states doing different things making it harder for employers to hire illegal immigrants with the federal government engaging in an additional set of tough enforcement actions, both at the border and at the work site, creating a jumble. Employers just don't know what to think about what's going to come down the pike next.
SMITH: That's the problem on Chandler Mountain. Jamie Boatwright doesn't know how many tomatoes to plant because now he has no idea if there's going to be anyone around to pick them. This is the perfect example of what Republicans are always talking about, regulatory uncertainty. Government, they say, should stop interfering in business, making life unpredictable for companies.
And yet, Republicans passed this new law in Alabama. Why upset the tomato cart? I talked to the sponsor of the bill, Alabama State Senator Scott Beason, about why the status quo needed to change.
State Senator SCOTT BEASON: Let's take the construction industry, for example. Two people are competing with each other, both of them may be framers. One of them, because we have low unemployment at that time, says, I'm going to hire some illegal workers. I don't care what the federal law is. I'm going to hire these folks. And because he can pay them a little bit less, and he's able to get more jobs because he has this ever-increasing illegal workforce, he begins to grow.
Well, his competitor down the street says, you know, I really don't want to hire any illegals. I know it's against the law. But if I'm going to survive, I need to go down that same route. Well, he begins to do that. And as they undercut the process for their subcontractors, you begin to see people no longer in the dry wall business, more difficult to be in the painting business, brick laying and that sort of thing.
So over the years, you end up with a big problem growing where more and more people hire more and more illegals, which is a continued magnet to draw more people into the state. And we have - we were down to that point, and then we have to try to fix that problem. And there's a little bit of jolt that happens when you stop the car and turn around and go the other way.
SMITH: Now, while you were considering this law, you must have heard from businesses around the state. They're complaining now - I assume they were complaining then - what were they saying to you?
BEASON: A number of these people are coming out and basically saying, you know, now we're in a tie because we can no longer hire people and continue to break what was a federal law, now it's a state law. I understand there's going to be a readjustment time, but it's like any problem you got to fix. There will be a certain amount of time you have to readjust, but things will be better in the long run.
It is not going to be smooth and easy for every single person, especially if you've been out there basing your business, basing your livelihood on breaking the law and hiring an illegal workforce. I think that gets missed a lot also.
SMITH: You seem to understand that this may be difficult in the short term. This is difficult to adopt for some people, yeah
BEASON: Oh, I do. I do. And I've always said that. I think what the unfortunate thing is, is that there were associations, groups, some members of the media who, since the end of May, first of June when we passed our legislation, basically led business owners, farmers, et cetera, to believe that it would never stand up. It's never going to go into effect, and then they were caught off guard when it actually did go into effect over the last weekend.
We were telling them for weeks and weeks. Now, we've done a good job. We've done our due diligence, and we're going to play on the ball field that we're allowed to. And I think it is unfortunate that they did not do the things in a third of a year, four months, to change the way they were doing business so they can get over these last couple weeks of harvest.
SMITH: Do you believe that American citizens, people who live in Alabama legally, do you believe that they're going to go out to the fields and pick the crops?
BEASON: There's always the argument that Americans or Alabamians will not do these jobs. And I don't believe that. Americans and Alabamians have done these jobs historically. I think they will do these jobs again. There may have to be some differences in pay scale, but I think those are things that people will see these opportunities. The pay may have to be different, but Alabamians and Americans will do those jobs.
SMITH: That's Alabama State Senator Scott Beason. He spoke with me from the Gardendale Civic Center. Senator Beason, thank you much.
BEASON: Thanks, Robert. You all have a good day.
SMITH: You'll notice that Senator Beason mentioned wages. Here's the theory: without all those undocumented immigrants, the supply of labor dries up. Businesses will have to pay more to attract new workers, legal workers. Tomatoes will end up costing more, but Alabama's 10 percent employment rate goes down. But theory isn't working so well on Chandler Mountain. Jamie Boatwright is seeing more legal workers looking for work.
BOATWRIGHT: Since this law has went into effect, I've had 11 - a total of 11 people that were Americans to come and ask for work. A total of one of those actually came back the next day. I told him, yeah, be here at eight o'clock in the morning. That person picked four boxes of tomatoes, walked out of the field and said: I'm done.
BOATWRIGHT: And so these Mexicans, migrating workers, it has nothing to do with race. It has more to do with work ethic and culture. They do this year-round. They are in shape to do it. They're accustomed to doing it. The majority of, you know, Americans, you know, they may go pick something out of the garden for 15 or 30 minutes, and it takes them until the next day to get over it.
SMITH: They're often referred to as unskilled labor, but this is a sort of skill.
BOATWRIGHT: Oh, it's - actually, it's a specialized skill. By the time I tell someone that didn't grow up in this field how to pack a box of tomatoes, the tomatoes would already be gone. You know, there's a lot of people say, well, pay more. Well, when you go to the grocery story, the way it stands right now is Alabama has this law and we don't have the migrant workers. And then you got all of our competing states that we are competing with on a daily basis that do have those workers, their tomatoes are going to, say, on average, be 99 cents a pound. My tomatoes are going to be 2.99 or 5.99 or 10.99 a pound.
And the people, as a consumer, when they walk in and they say, I got Tennessee tomatoes here for 99 cents a pound, Alabama tomatoes here for 7.99 a pound. They look identical. Which one are they going to pick up?
SMITH: He's stuck. Boatwright can't use a machine to pick his tomatoes. He can't find workers for the usual wage. But if he raises his wages, his tomatoes will be too expensive. Jamie's wife, Lana, says she fears how this will end.
LANA BOATWRIGHT: This problem's not going to go away for the state of Alabama. The farmers may go away from the state of Alabama. Some of the industry may go away from the state of Alabama. But there's not a Band-Aid you can put on this to fix it quickly if this law is fully implemented.
SMITH: If it's any consolation, there is something that usually ends this problem, an economic recovery. U.C. San Diego professor Gordon Hanson.
HANSON: What we've seen after every U.S. recession in the past 30 years or so is once the demand for labor really starts to pick up, what happens is those same politicians who were preaching a tough line on immigration suddenly get softer.
SMITH: Though, Hanson says, these new laws are so tough it may be difficult to go back this time around. If the law stays in effect, the U.S. Justice Department has asked a federal appeals court to look at the constitutionality of the Alabama law. Transcript provided by NPR, Copyright NPR.