The Economic Impact of Immigration David Coates As we assess the impact of the movement of so many undocumented workers on the economy into which they move, we need constantly to remind ourselves that immigration – legal or otherwise – has long been a key feature of the American economic story. In one sense, illegal immigration is as American as apple pie. Certainly, the first immigrants from the European mainland did not settle in the United States with the explicit permission of the Native Americans already here. On the contrary, their arrival was much resisted. It was not labeled as illegal, of course, that was not the Native American way; but it was resisted – resisted, indeed, even more fiercely than illegal immigration is being resisted now. Those first uninvited immigrants brought to these shores both the most progressive (in the English colonies) and the most backward (in the areas controlled by Spain and Portugal) of the competing sets of economic practices then prevalent in the Western Europe from which they had just departed. The economic impact of early migration into the Americas was in that sense profoundly bifurcatory.1 It helped to set the northern colonies onto a trajectory of sustained economic growth, and the southern American states onto one of blocked development and international economic subordination. We do well to note the irony of our present condition. Modern illegal immigrants within the Americas move about on an uneven economic stage that undocumented immigrants, long ago, helped to call into being.
Later immigrants into the United States were less the architects of a new and uneven order than the foot soldiers of its development. The great nineteenth century waves of more regulated immigration into the United States swelled the ranks of an emerging agrarian and then industrial labor force made necessary by that northern economic growth. Their arrival, though invariably initially disruptive, was eventually largely welcomed (it was certainly tolerated) precisely because those immigrants filled a critical resource gap created by the absence of a feudal peasantry in pre-industrial America. Lacking its own rural reserve army of labor, the United States, as it industrialized, borrowed other countries’ peasantries to keep its factories running, just as initially it also borrowed other people’s capital and technology. It was only in the second half of the twentieth century that industrial expansion in the American Northeast and Midwest drew predominantly on internal sources of migrant labor; and even then, that historically unprecedented internal migration of the black southern rural poor into the northern cities was accompanied by initially a steady, and then greater, external movement of migrants into the United States. As black Americans left the southern countryside for the cities and the North in the years after 1945, Latino workers moved in behind them, helping to fill the unskilled laboring jobs that by then even African-Americans were beginning to desert.
The question before us here is whether this escalating flow of Latino labor has been, and is, as beneficial to long-term economic growth in the United States as were the flows of immigration which preceded it. It may not be. We may be in qualitatively new times, requiring a qualitatively different attitude to the arrival here of other countries’ “huddled masses, yearning to breathe free.” Certainly many conservative commentators claim that to be the case. They tell us that the undocumented workers now entering the United States in such numbers bring no economic benefits commensurate to the cost and offence of their illegality. On the contrary, they do damage. They possess the wrong sets of skills, or no skills at all. They create unemployment. They erode the wages of native-born workers. They over-burden an already heavily-stretched welfare state. They add to the number of the American poor.2