Undocumented workers in the labor market: an analysis of the earnings of legal and illegal Mexican immigrants in the United States

This paper studies the differences in earnings between Mexican legal and illegal immigrants in the United States. The analysis includes a cross-sectional examination of the wage differences between legal and undocumented workers as well as a longitudinal analysis examining the impact of legalization on the earnings of previously-undocumented workers. It is shown that the average hourly wage rate of male Mexican legal immigrants in the United States was 41.8% higher than that of undocumented workers while female legal immigrants earned 40.8% more. Though illegal immigrants have lower education and English proficiency, and a shorter period of residence in the United States, than legal immigrants, it is shown that differences in the observed characteristics of legal and illegal immigrants explain only 48% of the log-wage gap between male legal and illegal workers and 43% of the gap for women. An analysis of undocumented immigrants legalized after the 1986 U.S. immigration policy reform shows significant wage growth in the four years following legalization. These gains are due mostly to the change in legal status itself, not to changes in the characteristics of immigrants over time. Received: 7 July 1997/Accepted: 16 March 1998     

A consideration of the effect of immigration reform on the number of undocumented residents in the United States

The volume of immigration to the United States exceeds the amount of immigration to any other nation, but quantification must rely on measurement of population stocks. Comparison of foreign-born population figures for two or more survey dates reveal net immigration but fail to partition the foreign-born population by legal status. This analysis presents national survey data on the foreign-born population in November 1989 for comparison with an independently derived estimate of the legally resident foreign-born population at the same date. The demonstration of a measurable undocumented population residing in the United States is very helpful in evaluating the success of the Immigration Reform and Control Act of 1986. Despite the legalization of 1.7 million aliens who provided evidence of undocumented residence since before 1982, and economic sanctions against employers found to hire undocumented workers, an undocumented population persists in the United States that appears to be largely composed of aliens from Latin American countries. Precise measurement of the size of this population is complicated by the uncertainties surrounding the population of approximately one million Special Agricultural Workers admitted under IRCA. The work and residence history of these aliens as well as their future labor sector experiences and residence patterns are not known. Despite efforts to stop undocumented immigration to the United States, undocumented migration, especially across the southern border, appears to have occurred at consistent levels throughout the past fifteen years.This paper reports the general results of research undertaken by Census Bureau staff. The views expressed are attributable to the author and do not necessarily reflect those of the Census Bureau.     

Immigration to the U.S.: the unfinished story

Annual totals of new immigrants and refugees in the US may now be up to the record highs of over a million immigrants counted in 6 years between 1905 and 1914. Since 1979, legal immigrants have averaged 566,000 a year (570,009 in 1985), newly arrived refugees and asylees approved have averaged 135,000, and the "settled" illegal immigrant population is growing by up to 1/2 million a year, according to some estimates. 1/2 of illegal immigrants are persons who entered the US legally but then overstayed the terms of temporary visas. Immigration and Naturalization Service apprehensions of illegal aliens, projected at a record 1.8 million for fiscal year 1986, indicate a sharp increase in illegal border crossers, driven by Mexico's and Central America's mounting population and economic pressures and lured by the prospect of jobs with employers who through a loophole in US immigration law can hire illegal aliens without penalty. The Census Bureau estimates that net immigration now accounts for 28% of US population growth and will account for all growth by the 2030's if fertility stays at the current low 1.8 births per woman. Public opinion strongly favors crubs on illegal immigration and legalization of illegal aliens long resident in the US, and in 1986 Congress enacted legislation to reduce illegal immigration to the US. Asians and Latin Americans now make up over 80% of legal immigrants and Latin Americans comprised 77% of illegal immigrants counted in the 1980 census. Asians far outstrip Latin American immigrants in education, occupational status, and income and might be expected to assimilate in the same manner as earlier immigrant group did. Hispanic immigrants so far appear to favor cultural pluralism, maintaining their own culture and the Spanish language. Research in California indicates that recent Hispanic immigrants (legal and illegal) have helped preserve low-wage industries and agriculture. Illegal immigrants appear to draw more on public health and education services than they pay back in taxes. With or without immigration reform, population and economic pressures in Mexico and the Caribbean Basin ensure that the numbers of people seeking to enter the US are only likely to increase.     

The initial effects of immigration reform on farm labor in California

Agriculture was the major industry singled out for preferential treatment in the Immigration Reform and Control Act (IRCA) of 1986. Farmers argued that their traditional reliance on unauthorized workers and the seasonal nature of work in perishable commodities required extra time for them to adjust to immigration reforms.A February 1989 survey of California farm employers indicates that these employers had not yet adjusted to IRCA. Instead of revising their personnel policies to retain newly legalized farmworkers, farmers expected to hire more workers through labor contractors if the seasonal workforce contracts in the years ahead.     

On financing the internal enforcement of illegal immigration policies

"We introduce a government budget constraint into an illegal immigration model, and show that the effect of increasing internal enforcement of immigration laws on the host country's disposable national income depends on the mix of employer fines and income taxation used to finance the added enforcement. These issues are addressed under alternative assumptions about (a) the ability of host country employers to discern between legal and illegal workers, and (b) host country labor market conditions. Empirical evidence for the United States indicates that the employer sanctions program may have had a negative impact on disposable national income."     

Do amnesty programs reduce undocumented immigration? Evidence from Irca

This article examines whether mass legalization programs reduce future undocumented immigration. We focus on the effects of the 1986 Immigration Reform and Control Act, which granted amnesty to nearly 2.7 million undocumented immigrants. We report that apprehensions of persons attempting to cross the U.S.-Mexico border illegally declined immediately following passage of the law but returned to normal levels during the period when undocumented immigrants could file for amnesty and the years thereafter. Our findings suggest that the amnesty program did not change long-term patterns of undocumented immigration from Mexico.     

Immigration and free trade with Mexico: protecting American workers against double jeopardy

Free trade may well increase immigration from Mexico to the United States before ultimately slowing it down. Rapid population growth, unemployment or underemployment of half the labor force, and vast ethnic and kinship links to the United States have given Mexican migration a stubborn momentum. Increased prosperity from free trade will give many would-be migrants the means to resettle in the U. S. Foreign competition will displace Mexican workers in small farms, state-owned enterprises, and less competitive industries, forcing some to migrate. The noneconomic incentives and expectations driving migration will also remain strong. Mexicans may see free trade as making the border a mere formality or as conferring an entitlement to live in the United States. On the U. S. side, free trade may well deepen the government's traditional complacency about border controls. Over the long-term, however, a successful free trade agreement could reduce immigration by improving Mexico's democracy and the quality of life, diminishing the prospects of mass asylum movements from Mexico, creating a better climate for effective family planning, and luring marginal, immigration-magnet industries from the U. S. to Mexico. In the United States, less- skilled American workers in some industries and regions can expect job displacement and other disruptions from free trade. Particularly vulnerable will be workers in perishable crop agriculture, border retail trade, construction, apparel, and light manufacturing such as furniture, auto parts and glass. Continued heavy immigration of Mexican and other foreign workers into those industries and communities will further impede the adjustment of resident workers by competing for jobs and consuming public resources needed for retraining and job search. To ease the adjustment of displaced workers, the U. S. must make Mexico's cooperation in restraining immigration a condition for free trade. Mexico's cooperation should include enforcement of its own laws against clandestine border crossing; action against alien smugglers, document forgers and transiting illegal aliens from Central America; and curbs on the reentry of aliens deported from the United States. U.S. initiatives that would cushion vulnerable American workers against the added disruption of immigration would be: better identification and screening of applicants for public assistance; tightened enforcement of safety and labor standards in immigrant-impacted firms and provision of legal workers to such firms; protection of public assistance resources through better screening and identification of applicants; and curbs on imports of temporary foreign workers for firms that will now have access to Mexican labor in Mexico. Finally, the United States must consistently press Mexico for higher safety, environmental and labor standards at the workplace to improve the job satisfaction and quality of life of working Mexicans who might otherwise migrate, as well as to narrow Mexico's labor cost advantages over the United States.     

An analysis of public opinion toward undocumented immigration

Public opinion toward illegal migration to the United States varies considerably across different segments of the population, but little is known about why some individuals hold more liberal attitudes than others. Several hypotheses are scattered throughout the research literature, but they have not been brought together in one place and tested using a common data set. Nor have the limited tests been satisfactory from a methodological standpoint. Instead of using multiple regression, typically analysts have relied on cross-tabulations of the data. This paper tests five hypotheses about attitudes toward illegal immigration and undocumented migrants using public opinion data from southern California. Only weak support is found for a labor market competition hypothesis. There is firmer evidence for hypotheses relating to cultural affinity between respondents and undocumented migrants and to the role of education. Respondents' evaluations of tangible costs and benefits to themselves also influence their assessments of illegal immigration. Finally, the results of this analysis provide additional support for a symbolic politics model of opinion formation when the model is extended to the issue of undocumented migration to the United States.     

The U.S. 1986 Immigration Reform and Control Act and undocumented migration to the United States

One of the major goals of the 1986 Immigration Reform and Control Act (IRCA) is to reduce the number of undocumented immigrants coming to and residing in the United States. This goal is pursued by allocating increased resources to Border Patrol enforcement, imposing penalties on employers for hiring undocumented workers, and offering to legalize the undocumented population that has resided in the country for a substantial period of time. This paper evaluates the impact of IRCA on the flow of undocumented migrants across the U.S.-Mexican border by analyzing a monthly time series of Border Patrol apprehensions from January 1977 to September 1988 within the context of a multivariate statistical model. The model provides a good fit to the data (R² = 0.94), and our results indicate that INS resources, Mexican population growth, comparative economic conditions on both sides of the border, and seasonal factors related to the agricultural planting and harvesting cycle are all determinants of border apprehensions and, by implication, of the flow of undocumented migrants to the United States. IRCA's impacts on the number of ‘apprehensions averted’ operate mainly through changes in INS effort, the SAWs agricultural legalization program, and other IRCA-related factors. Our analysis concludes that the effects of IRCA, though perhaps smaller than sometimes alleged, were associated with a cumulative net reduction in linewatch apprehensions of nearly 700,000 in the 23-month period following enactment of the law. The associated reduction over the same period in the number of illegal border crossings may be as high as 2 million.     

Pathways to legal immigration

In this paper we use the New Immigrant Survey Pilot Study (NISP) todescribe the amount and kind of experience that immigrants accumulate in the United States before they become permanent resident aliens. The NISP surveyed a representative sampleof legal immigrants who acquired residence papers during July and August of 1996, yielding a completed sample of 1,135 adults. Our analysis revealed that roughly two-thirds of thesenewly arrived immigrants had prior experience in the United States within one of six basic categories: illegal border-crossers, visa abusers, non-resident visitors, non-resident workers, students or exchange visitors, and refugees/asylees. Each of these pathways to legal immigration wasassociated with a different profile with respect to nationality, social background, and economic status. Using simple earnings regressions we demonstrate how these differences can yield misleading conclusions about the process of immigrant adaptation and assimilation, even if measured effects are reasonably accurate. We suggest that social scientists should changethe way they think and ask about immigrants' arrival in the United States.     

Stemming the tide? Assessing the deterrent effects of the immigration reform and control act

This study uses a new source of data to assess the degree to which the Immigration Reform and Control Act (IRCA) deterred undocumented migration from Mexico to the United States. Data were collected from migrants interviewed in seven Mexican communities during the winters of 1987 through 1989, as well as from out-migrants from those communities who subsequently located in the United States. We conduct time-series experiments that examine changes in migrants' behavior before and after passage of the IRCA in 1986. We estimate trends in the probability of taking a first illegal trip, the probability of repeat migration, the probability of apprehension by the Border Patrol, the probability of using a border smuggler, and the costs of illegal border crossing. In none of these analyses could we detect any evidence that IRCA has significantly deterred undocumented migration from Mexico.     

The Effects of Deferred Action for Childhood Arrivals on the Educational Outcomes of Undocumented Students

Deferred Action for Childhood Arrivals (DACA) is the first large-scale immigration policy to affect undocumented immigrants in the United States in decades and offers eligible undocumented youth temporary relief from deportation as well as renewable work permits. Although DACA has improved the economic conditions and mental health of undocumented immigrants, we do not know how DACA improves the social mobility of undocumented immigrants through its effect on educational attainment. We use administrative data on students attending a large public university to estimate the effect of DACA on undocumented students’ educational outcomes. The data are unique because they accurately identify students’ legal status, account for individual heterogeneity, and allow separate analysis of students attending community colleges versus four-year colleges. Results from difference-in-difference estimates demonstrate that as a temporary work permit program, DACA incentivizes work over educational investments but that the effect of DACA on educational investments depends on how easily colleges accommodate working students. At four-year colleges, DACA induces undocumented students to make binary choices between attending school full-time and dropping out of school to work. At community colleges, undocumented students have the flexibility to reduce course work to accommodate increased work hours. Overall, the results suggest that the precarious and temporary nature of DACA creates barriers to educational investments.     

Undocumented Mexican immigrants and the earnings of other workers in the United States

This article examines the effects of undocumented Mexican immigrants on the earnings of other workers in geographical labor markets in the Southwest. The number of undocumented Mexicans included in the 1980 census in southwestern SMSAs is estimated. We then estimate the parameters of three specifications of a generalized Leontief production function with various demographic groups as substitutable factors. The statistically significant effects of undocumented Mexicans on the earnings of other groups are positive, but of slight magnitude. Legal immigrants' effects on native white earnings, however, are small and negative. The results are consistent with the possibility that undocumented Mexican immigrants' jobs complement those of other workers. The implications for public policy concerns about the effects of illegal Mexican immigration are discussed.     

Illegal immigration,deportation policy,and the optimal timing of return

Countries with strict immigration policies often resort to deportation measures to reduce their stocks of illegal immigrants. Many of their undocumented foreign workers, however, are not deported but rather choose to return home voluntarily. This paper studies the optimizing behavior of undocumented immigrants who continuously face the risk of deportation, modeled by a stochastic process, and must decide how long to remain in the host country. It is found that the presence of uncertainty with respect to the length of stay abroad unambiguously reduces the desired migration duration and may trigger a voluntary return when a permanent stay would otherwise be optimal. Voluntary return is motivated by both economic and psychological factors. Calibration of the model to match the evidence on undocumented Thai migrants in Japan suggests that the psychological impact of being abroad as an illegal alien may be equivalent to as large as a 68 % cut in the consumption rate at the point of return.     

What is the annual net flow of undocumented mexican immigrants to the united states?

Senior government officials have claimed that in recent years an average of 1.4 million illegal aliens have entered the United States annually without apprehension. This conjectural figure does not take into account the fact that the net flow of immigrants is always less than the gross flow. In this paper, seven estimates are made concerning the net flow of undocumented Mexican immigrants to the United States in the period 1970--1975. These estimates are based on the growth of the population of Mexican origin according to the Current Population Survey. According to these estimates the annual net flow ranged from 82,300 to 232,400 persons.     

Immigration policies and trends: A comparison of Canada and the United States

This paper discusses recent migration to North America with reference to the 1962 and 1967 Canadian immigration regulations and the 1965 United States Immigration and Nationality Act. Despite the similar emphasis on manpower and kinship criteria as the basis for the admission of immigrants, differences between Canada and the United States exist with respect to the importance of immigration for the respective economies, the organization of immigration, the formal regulations, and the size and composition of migrant streams. After an examination of the volume, origin, and occupational composition of immigration to Canada and the United States, flows between the two countries are studied. The paper concludes with a scrutiny of changes in immigration regulations which are pending in both countries.     

Effects of the immigration act of 1965 on selected population characteristics of immigrants to the United States

Recent changes in immigration law have affected the characteristics of immigrants coming to the United States. The major changes in immigration policy contained in the 1965 Immigration Act, which amended the McCarran-Walter Act of 1952, concerned the abolition of the quota system, preference system and labor clearances for certain classes of immigrants. The effects of these policy changes on two controversial characteristics of immigrants, their country of origin and occupational levels, are traced. The law led to clear changes in origin of immigrants. Southern European, Asian and Caribbean immigrants make up a larger proportion of immigrants than previously. Although the volume of immigration increased, the distribution of occupational levels remained about the same. The sources of the various occupational groups shifted to some extent, especially the professional level from Asian countries. Some effects of the policy changes and the changes in population characteristics on the American social and political scene are briefly outlined.     

Playing Cat and Mouse at the U.S.-Mexican Border

Border control and apprehension activity represents a major element of the Immigration Reform and Control Act of 1986. Does apprehending an undocumented migrant deter remigration? If it does not, does it change future migration behavior? I explore these questions by testing hypotheses about the effects of apprehension on the actual and desired length of stay in the United States and on the frequency of migration for undocumented Mexican male migrants. Results suggest that INS policy may well be backfiring. Migrants stay in the United States longer on non-apprehended trips and stay in Mexico for shorter spells between trips to compensate for the cost of a past apprehension.     

Changes in Trip Duration for Mexican Immigrants to the United States

Using the Mexican Migration Project sample, this paper explores the patterns of trip duration for Mexican immigrants to the United States and the reasons for the patterns observed. I found that the most important factors leading to changes in trip duration are US immigration policy, the conditions of the Mexican economy, and the development of social networks. It appears that the legalization of many immigrants after passage of the Immigration Reform and Control Act encouraged short-term migration, but the build-up at the US-Mexico border may have changed this pattern leading to longer duration in the United States. Furthermore, changes in the exchange rate, a devaluation of the peso relative to the dollar, for example, leads to more return migration, as immigrants are able to get more value for his dollars in Mexico. On the other hand, an expansion of networks and resources for immigrants in the United States leads to longer duration in the United States.     

Unintended consequences of US immigration policy: explaining the post-1965 surge from Latin America

Immigration reforms in the United States initiated in the 1960s are widely thought to have opened the door to mass immigration from Asia and Latin America by eliminating past discriminatory policies. While this may be true for Asians, it is not the case for Latin Americans, who faced more restrictions to legal migration after 1965 than before. The boom in Latin American migration occurred in spite of rather than because of changes in US immigration law. In this article we describe how restrictions placed on the legal entry of Latin Americans, and especially Mexicans, set off a chain of events that in the ensuing decades had the paradoxical effect of producing more rather than fewer Latino immigrants. We offer an explanation for how and why Latinos in the United States, in just 40 years, increased from 9.6 million people and 5 percent of the population to 51 million people and 16 percent of the population, and why so many are now present without authorization.