Jason Richwine, Center for Immigration Studies, April 16, 2019
One of the many trade-offs inherent to immigration policy is efficiency vs. distribution in the labor market. Importing more workers from abroad can lower the cost of production, but the savings come in large part from holding down wages. Anyone who claims that immigration offers only benefits or only costs to the labor market is not being honest about the issue. Unfortunately, immigration advocates have a habit of developing exactly those sorts of one-sided talking points. One of the most prominent right now is the idea of a “labor shortage”. Forget all this talk about trade-offs, they say, employers simply cannot find any more workers without immigration.
That claim is false. Neither theory nor evidence backs the existence of a “labor shortage”. As discussed below, when employers complain of a “shortage”, they really mean a shortage of people willing to work for the (low) wage that employers would like to pay. The percentage of working-age Americans not in the labor force remains significantly below the level from the year 2000, and employers should strive to bring those potential workers back.
[Editor’s Note: There is not charge for the entire study, which is available at the original story.]