National Data | May Jobs: Obama-Era Immigrant Displacement Of American Workers Resumes
Print Friendly and PDF
The economy added a lackluster 217,000 jobs in May, about in line with what economists had expected. The unemployment rate remained at 6.3%.

Yet the MSM teased out a number of Happy Days Are Here Again factoids:

Reality check: As many as 90,000 of those jobs are needed just to absorb the new legal immigrants arriving each month. When you consider that 8 million native-born American workers were unemployed in May, and millions more have left the labor force entirely, 200,000 per month is, in fact, shockingly low. Reality check: Not since the Great Depression has it taken so long to recover all the jobs lost during a downturn.

But back then, immigration and native-born population growth was at a standstill. Stagnant population growth ameliorated the impact of stagnant job growth. By contrast, U.S. population has grown by about 12.5 million since 2008—most of it due to new immigrants and their U.S.-born children.

For perspective we analyze the “other” employment survey, of households rather than business establishments. The Household Employment Survey reports total U.S. employment at 145.814 million in May, or more than 7 million above the Establishment Survey’s total. As has uniquely pointed out, this discrepancy reflects, in part, the reluctance of employers to acknowledge the existence of illegal aliens on their payrolls.

Only 145,000 jobs were created in May, according to the Household Survey. The Household survey now breaks out the employment of immigrants, legal and illegal. Our analysis of the data finds that all of this May job gain accrued to immigrants:

In May:

  • Total       employment rose by 145,000, or by 0.10%
  • Native-born American employment fell by 39,000 or by 0.03%
  • Foreign-born employment rose by 184,000, or by 0.78%
Thus May marked the resumption of native-born American worker displacement, a trend which had been in hiatus during the horrific winter of 2014.

The displacement of native-born American workers by immigrants has been a central fact of economic life during most of the Obama era. This is evident in our New American Worker Displacement Index (NVDAWDI) graphic:


Native-born American employment growth is the blue line, immigrant employment growth is in pink, and NVAWDI—the ratio of immigrant to native-born American job growth—is in yellow. The graphic starts at 100.0 for both native-born American and immigrant employment in January 2009, and tracks their growth since then.

From January 2009 to May 2014:

  • Foreign-born employment rose by 2.235 million, or by 10.24%. The immigrant employment index rose from 100.0 to 109.1.
  • Native-born American employment rose by 1.358 million or by 1.13%. The native-born American employment index rose from 100.0 to 101.1.
  • NVDAWDI (the ratio of immigrant to native-born employment growth indexes) rose from 100.0 to 109.1 (100X(109.1/101.1)
A more detailed picture of American worker displacement over the past year, May 2013 to May 2014, is seen in Household Survey data published in the monthly job report:
Employment Status by Nativity, May 2013-May 2014(numbers in 1000s; not seasonally adjusted)
  May-13 May-14 Change % Change
Foreign born, 16 years and older
Civilian population 37,503 38,637 1,134 3.0%
Civilian labor force 24,958 25,392 434 1.7%
     Participation rate (%) 66.5% 65.7% -0.8% -1.2%
Employed 23,384 23,977 593 2.5%
Employment/population % 62.4% 62.1% -0.3% -0.5%
Unemployed 1,574 1,416 -158 -10.0%
Unemployment rate (%) 6.3% 5.6% -0.7% -11.1%
Not in labor force 12,545 13,245 700 5.6%
Native born, 16 years and older
Civilian population 207,860 208,985 1,125 0.5%
Civilian labor force 130,776 130,448 -328 -0.3%
     Participation rate (%) 62.9% 62.4% -0.5% -0.8%
Employed 121,048 122,421 1,373 1.1%
Employment/population % 58.2% 58.6% 0.4% 0.7%
Unemployed 9,728 8,027 -1,701 -17.5%
Unemployment rate (%) 7.4% 6.2% -1.2% -16.2%
Not in labor force 77,084 78,537 1,453 1.9%
Source: BLS, The Employment Situation - April 2014,Table A-7, June 6, 2014.PDF

Over the past 12 months:

  • Immigrant employment rose by 593,000 positions, a 2.5% increase; native-born American workers rose by 1,373,000 positions, a mere 1.1% increase. ADVANTAGE IMMIGRANTS
  • The labor force participation rate (LPR) fell by 0.8 percentage points for immigrants and by 0.5 percentage points for native-born Americans. Nevertheless, the immigrant LPR remains well above that of native-born American. ADVANTAGE IMMIGRANTS
  • The number of unemployed native-born Americans fell by 17.5%. The corresponding figure for immigrants was a decline of 10.0%. Sounds good for native-born Americans—but it may simply reflect the expiration of extended unemployment benefits to millions of native-born American workers. Once the checks stop, so does the illusion that they’ll find a job, and they stop looking. At that point they are no longer counted as unemployed.
Overarching everything is the burgeoning gap in working-age population growth. Over the past year the number of foreign-born aged 16 and over rose by 3.0%. The corresponding rate for native-born Americans: 0.5%.

If these differentials persist, the number of working-age immigrants will double in only 24 years. It will take 144 years for native-born workers to match that.

We need a Depression-era moratorium to counter-balance our increasingly Depression-era economy.

Edwin S. Rubenstein (email him) is President of ESR Research Economic Consultants.


Print Friendly and PDF