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Harry J. Holzer January 2011

Immigration Policy and Less-Skilled Workers in the US: Some Reflections and Future Directions for Reform. Harry J. Holzer January 2011. More- v. Less-Educated Immigrants. Little Doubt about Contributions of More-Educated Immigrants to Native-Born Americans and the US Economy

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Harry J. Holzer January 2011

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  1. Immigration Policy and Less-Skilled Workers in the US: Some Reflections and Future Directions for Reform Harry J. Holzer January 2011

  2. More- v. Less-Educated Immigrants • Little Doubt about Contributions of More-Educated Immigrants to Native-Born Americans and the US Economy • What about Less-Educated??? Ratios of Benefits to Costs, How They Might Change, and Implications for Reform Policy

  3. General Goals and Major Questions (Cont’d) Questions: • Costs and Benefits of Current Flow of Unskilled, and to Whom Do They Accrue? • Would Costs and Benefits Change with Shift in Legal Status and Categories? • Effects of Immigrant Upgrading on US Economy and Native-Born?

  4. Costs of Unskilled Immigration:Competition for NB Less-Educated • Research by David Card, George Borjas, and others: Modest Negative Impacts on NB • Why are these impacts so modest? Product Demand, Imperfect Substitution for NB, Effects on Production Techniques • In Their Absence: What Kinds of New Labor Market Equilibria would Emerge? Disruptions of Reducing Flow in Short Run, Adjustments Over Time • Fiscal Effects as Well...Short-Run v. Long-Run, Federal v. State/Local

  5. Benefits to the US Economy • Employer Surplus • Consumer Benefits (P. Cortes) – Understated? For Whom? Not Just High-Income Consumers! • Labor Supply of Highly-Educated Women • Economic Dynamism and Efficiency

  6. Punchline: Too Many or Too Few Unskilled Immigrants in US? • Not a Clear Case Either Way! • Future Effects of Baby Boomer Retirements: Doesn’t Greatly Change the Picture (Though Costs of Unskilled Immigration Will Likely Diminish and Benefits Rise) • Desire to Upgrade Education and Skills of US Citizens v. Immigrants Providing Low-Skilled Labor: Conflict? Not necessarily…

  7. Costs and Benefits: Vary with Immigrant Category • Legal v. Illegal • Employment-Based: Greater Ability to Adjust to Economic Changes • So: Create Incentives for Illegal Immigrants and Employers to Shift to Legal/Temporary Modes that are Employment-Based; Requires Opportunities for Permanence

  8. Policy Implications Support for Comprehensive Immigration! But With Some Amendments: • Guest Workers: Ability to Switch Jobs, Option of Permanent Residence (Provisional Visa?) • Fees for Guest Workers • Macroeconomic Adjustments to Numbers Admitted • State-Level Variation and Flexibility?

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