New Labor Rules Make Some Fear Decline in Work Force

Houston industry and labor leaders say new federal rules that threaten businesses with prosecution if they don’t fire suspected illegal immigrants could cripple the regional economy.

Last week, the Department of Homeland Security issued a revised version of its “no-match” regulations, which punish employers whose employees’ names don’t match their Social Security numbers.

The regulations are provoking such urgency among local business leaders that the powerful Greater Houston Partnership has created a nonprofit lobbying group—Americans for Immigration Reform—to battle the new rules.

Jeff Moseley, president and CEO of the partnership, said the lobbying group is also working to revive comprehensive immigration reform in Congress later this year. They plan to hire at least 10 staff members and raise $15 million to $20 million from the business community.

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The partnership, a not-for-profit, private booster group with 1,800 member companies, lobbies governments on business issues important to Houston and works to bring new business to the area.

It estimates that the Houston Metropolitan Statistical Area has 250,000 undocumented workers who add $27 billion yearly to the regional economy.

The partnership says five industries account for the bulk of illegal workers in Houston: construction, manufacturing, professional and business services, accommodation and food services, and other services.

Dale Wortham, president of the AFL-CIO Council in Harris County, said the no-match rules could lead to a construction worker shortage.

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But there are some who downplay the potential harm to Houston’s economy, noting no-match letters are sent only to companies where more than 10 workers with discrepancies are identified.

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[Barton Smith, an economics professor at the University of Houston who directs the Institute for Regional Forecasting] said the no-match rule wouldn’t affect businesses with few employees, and workers from other parts of the nation could migrate here for jobs vacated by illegal immigrants.

Texas 2nd nationally

DHS estimates more than 7 million people, or 5 percent of the civilian labor force, is here illegally.

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The Social Security Administration sent out 138,447 no-match letters nationally in 2006. Texas was second with 12,713 businesses getting letters. Because each letter contains more than 10 discrepancies, it’s estimated that in 2006 at least 139,843 workers in Texas had names that didn’t match Social Security numbers.

Businesses previously were not required to take action on receiving the letters. But under the new rules, employers that don’t reconcile discrepancies in 90 days must fire workers or face fines and criminal charges.

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