The Washington Post had a lengthy article reporting on the findings of a study by the Center for Immigration Studies, which purports to show that stepped up enforcement of immigration laws has reduced the flow of illegal immigrants into the country. The basis for this contention, according to the article, is that the number of immigrants in the country illegally fell sharply by some estimates in the summer of 2007. The study attributes this decline to enforcement rather than the economy, because the unemployment rate did not begin to rise for less educated Hispanics until 6 months after the decline in immigration. There are several problems with this assessment. First, the residential construction sector, which was an important source of jobs for undocumented workers began to contract in the winter of 2006. By the summer of 2007, housing starts were already down by more than one-third. If this source of jobs had dried up it may not have been reflected in unemployment rates for two reasons. First, the main impact could have been that flow of immigrants slowed, since the jobs were no longer here, and some unemployed workers returned to their home countries. This means the loss of jobs may not have been associated with an increase in the unemployment rate among Hispanics in the United States. The second reason that the job loss may not have resulted in an increase in the measured unemployment rate is that many undocumented workers are not covered by the Census Bureau's main survey for measuring unemployment, the Current Population Survey. The coverage rate for young Hispanic men in this survey is just over 70 percent. This means that there can be a substantial increase in unemployment among this group that may not be picked up by the survey, especially if unemployed workers are less likely to be covered than employed workers. For these reasons, it is entirely plausible that the labor market turned down for undocumented workers before there was any measured increase in the unemployment rate among less educated Hispanics. The recent upturn in the unemployment rate for this group can be explained by the fact that the continued deterioration of the labor market may be reaching segments of the Hispanic population with deeper roots in the United States, who are more likely to both stay in the country when unemployed, and be covered by the survey.
--Dean Baker
