Keeping out Mexican Immigrants won’t Help U.S. Workers

by Bryce Covert –

The U.S. once tried to shut out immigrants to increase jobs and wages, but it failed at both goals.

President Trump assumed the presidency promising to be “the greatest jobs producer God ever created.” And one way he said he would reach that goal as he campaigned for the White House would be to dramatically reduce immigration. “I will change immigration rules to give unemployed Americans an opportunity to fill good, really good paying jobs,” he said in June. “We don’t have good paying jobs anymore. These will be good paying jobs.”

The U.S. tried this approach before. A program that made it easier for agricultural workers from Mexico to work in the United States was ended in the 1960s as an explicit move to increase jobs and pay for U.S.-born workers. But a new paper finds that it didn’t do what leaders at the time wanted: wages and employment for domestic farm workers stayed the same, even as the supply of immigrant workers fell dramatically.

The U.S. and Mexico made three agreements that relaxed restrictions on employing Mexican workers in the country between 1942 and 1964, creating what came to be known as the bracero program, which eventually focused almost entirely on farm workers. The program brought nearly half a million workers to American farms each year.

But in 1962, the Kennedy administration began pulling back on it, and in 1964 the Johnson administration fully terminated it. This was explicitly done as a way to increase jobs and wages for domestic workers. As he took action to curb it, President Kennedy referred to the “adverse effect of the Mexican farm labor program…on the wage and employment conditions of domestic workers.”

As the authors of the paper note, “The exclusion of Mexican bracero workers was one of the largest-ever policy experiments to improve the labor market for domestic workers in a targeted sector by reducing the size of the workforce.”

But that’s not what happened after it was terminated. “We find that bracero exclusion had little measurable effect on the labor market for domestic farm workers,” the paper’s authors write. They examined states that had a large share of bracero workers and compared what happened to them with those that had few or no braceros. They found that wages and employment were about the same in states with previously large shares of braceros as in the others.

Bracero workers weren’t quickly replaced by U.S. natives, nor were their jobs taken over by other Mexican workers, either authorized or unauthorized. Instead, the termination of the program didn’t have much of an impact on jobs. While the authors found a modest increase in domestic workers’ employment in states that had previously had lots of braceros, there was a similar increase in states that had none.

“[T]here is no evidence of a rise in domestic employment concurrent with declines in bracero employment,” the authors write. “If anything, these results suggest a fall in domestic farm employment concurrent with falls in bracero stocks during the program, which is compatible with some degree of complementarity between Mexican and domestic labor.”

The same story played out for wages. Wages rose at about the same rate before and after the program was ended in states that had braceros, and they even rose more slowly in those states than in states that had none.

Instead, the authors find that American employers reacted to the end of the bracero program by either adopting new technology that could speed up the planting and harvesting processes or by cutting back on production. For tomato, cotton, and sugar beet crops, technology was already available that could significantly increase production, and those were deployed quickly after braceros were kept out. For the six other crops where technology wasn’t available, there were “large and lasting” declines in production during and after 1965.

These results, the authors conclude, “suggest that bracero exclusion signally failed as an active labor market policy intended to cause increases in domestic wages and employment in farm work.”

The paper’s findings could hold a warning for the administration that severely cutting back on immigration won’t help American workers. More recent experiments in restricting the flow of immigrants had similar results. After Arizona’s SB 1070, or the “show me your papers” law, went into effect, it lost 3,000 jobs in one year. A restrictive law in Alabama caused a shortage of workers that dramatically sowed work at factories and farms. It’s been estimated that a law in Georgia will cost between $300 million and $1 billion in lost agricultural output.

There’s other evidence that supports the findings. A massive report from 14 prominent economists and academics last year found that the impact of immigrants on native-born workers is small.

Deporting immigrants and halting their ability to enter the country, on the other hand, could seriously hamper the economy. The same report found that both legal and undocumented immigrants grow the economy by 11 percent every year. Another found that mass deportation would reduce it by 1.4 percent in the near term and 2.6 percent long term, while also decreasing employment in agriculture, construction, hospitality, and leisure by double digits. And yet another report from a conservative think tank found that immediately deporting all undocumented immigrants would shrink the economy by 2 percent while leaving millions of jobs empty.

Reprinted with permission from Think Progress, a branch of The Center for American Progress