All Employment Growth Since 2000 Went to Immigrants

Number of U.S.-born not working grew by 17 million

Government data show that since 2000 all of the net gain in the number of working-age (16 to 65) people holding a job has gone to immigrants (legal and illegal). This is remarkable given that native-born Americans accounted for two-thirds of the growth in the total working-age population. Though there has been some recovery from the Great Recession, there were still fewer working-age natives holding a job in the first quarter of 2014 than in 2000, while the number of immigrants with a job was 5.7 million above the 2000 level.

All of the net increase in employment went to immigrants in the last 14 years partly because, even before the Great Recession, immigrants were gaining a disproportionate share of jobs relative to their share of population growth. In addition, natives’ losses were somewhat greater during the recession and immigrants have recovered more quickly from it. With 58 million working-age natives not working, the Schumer-Rubio bill (S.744) and similar House measures that would substantially increase the number of foreign workers allowed in the country seem out of touch with the realities of the U.S. labor market.

Three conclusions can be drawn from this analysis:

• First, the long-term decline in the employment for natives across age and education levels is a clear indication that there is no general labor shortage, which is a primary justification for the large increases in immigration (skilled and unskilled) in the Schumer-Rubio bill and similar House proposals.

• Second, the decline in work among the native-born over the last 14 years of high immigration is consistent with research showing that immigration reduces employment for natives.

• Third, the trends since 2000 challenge the argument that immigration on balance increases job opportunities for natives. Over 17 million immigrants arrived in the country in the last 14 years, yet native employment has deteriorated significantly.

Among the findings:

• The total number of working-age (16 to 65) immigrants (legal and illegal) holding a job increased 5.7 million from the first quarter of 2000 to the first quarter of 2014, while declining 127,000 for natives.

• In the first quarter of 2000, there were 114.8 million working-age natives holding a job; in the first quarter of 2014 it was 114.7 million.

• Because the native-born population grew significantly, but the number working actually fell, there were 17 million more working-age natives not working in the first quarter of 2014 than in 2000.

• Immigrants have made gains across the labor market, including lower-skilled jobs such as maintenance, construction, and food service; middle-skilled jobs like office support and health care support; and higher-skilled jobs, including management, computers, and health care practitioners.

• The long-term decline in the share of working-age natives holding a job began before the 2007 recession, falling from 74 percent in 2000 to 71 percent in 2007. It is now an abysmal 66 percent, improving only slightly since the bottom of the recession.

• The share of natives working or looking for work, referred to as labor force participation, shows the same decline as the employment rate. In fact, labor force participation has continued to decline for working-age natives even after the jobs recovery began in 2010.

• Immigration has fallen in recent years. But despite the economy, between 2008 and the start of 2014 6.5 million new immigrants (legal and illegal) settled in the country and three million got jobs. Over the same time, the number of working-age natives holding a job declined 3.4 million.

• In contrast to natives, the employment rate of working-age immigrants increased from 2000 to 2007 and has recovered more quickly from the Great Recession than natives, though it has not fully recovered.

• Since the jobs recovery began in 2010, 43 percent of employment growth has gone to immigrants.

• If the employment rate of working-age natives in the first quarter of this year were what it was in 2007, 7.9 million more natives would have a job. If the share working were what it was in the first quarter of 2000, 12.5 million more natives would have a job today.

• There were a total of 69 million working-age immigrants and natives not working in the first quarter of 2014. There were an additional 7.3 million forced to work part-time despite wanting full-time work.

• The supply of potential workers is enormous: 8.7 million native college graduates are not working, as are 17 million with some college, and 25.3 million with no more than a high school education.

Introduction

Congressional Budget Office projections indicate that if the Schumer-Rubio bill (S.744) becomes law, the number of new legal immigrants allowed into the country will roughly double to 20 million over the next decade, adding to the 40 million immigrants (legal and illegal) already here.¹ This increase is in addition to the legalization of illegal immigrants already in the country. The primary argument for this dramatic increase is, as Republican congressman Paul Ryan (R-Wisc.) has argued, that without it the country faces “labor shortages”. The National Restaurant Association, National Association of Home Builders, National Association of Manufacturers, Business Roundtable, U.S. Chamber Commence, and numerous other companies and business associations have all argued that immigration should be increased because there are not enough workers in the country — both skilled and unskilled.² This report examines employment trends for immigrants and natives to see if potential workers are, in fact, in short supply.

The findings show that employment growth has been weak over the last 14 years and has not kept pace with population growth and new immigration. Among the working-age (16 to 65), what employment growth there has been has entirely gone to immigrants (legal and illegal). This is truly remarkable because natives accounted for two-thirds of overall population growth among the working-age population.³ In short, natives accounted for two-thirds of the growth in the number of potential workers, but none of the growth in the number of actual workers.⁴ Employment, of course, fluctuates with the economy, but all of the net increase in employment has gone to immigrants from 2000 to 2014, partly because natives never fully recovered from the 2001 recession and a disproportionate share of employment growth went to immigrants. Further, natives were somewhat harder hit by the 2007 recession and immigrants have recovered from it faster than have natives.

Immigrants made gains through the labor market over the last 14 years; about half of that growth in immigrant employment was for those with a bachelor’s degree or more. At the same time, there has been a long-term deterioration in the employment rate for natives of every education level, race, and age.

There has been some improvement for natives since the job market bottomed out in 2010, but still 43 percent of employment growth has gone to immigrants. Despite some improvement, the share and number of working-age natives holding a job has not come close to returning to the levels in 2007 or 2000.

This analysis is based on the “household survey” collected by the Census Bureau for the Bureau of Labor Statistics. The survey, officially known as the Current Population Survey (CPS), is the nation’s primary source of information on the U.S. labor market.⁵ The CPS survey does not include those in institutions such as prisons. We concentrate in this analysis on the first quarter of each year 2000 to 2014 because comparing the same quarter over time controls for seasonality and the first quarter of 2014 is the most recent quarterly data available. (Table 1 reports figures for every quarter and year.) We also emphasize the economic peaks in 2000 and 2007 as important points of comparison.

We primarily focus on the share of working-age people holding a job, referred to by economists as the employment rate. The employment rate is a straightforward measure of who has a job and who does not. To a lesser extent we examine labor force participation, which is the share of people working or looking for work. Labor force participation and the employment rate are measures of labor force attachment that are less sensitive to the business cycle than the often-cited unemployment rate, which we also report.

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