A large low-skilled Mexican workforce can insulate native-born workers from bearing the full brunt of an employment decline, according to new research.
Americans living in cities with a larger share of low-skilled Mexican-born workers fare better in times of high unemployment than those living with a smaller population of Mexican immigrants, write researchers Brian C. Cadena and Brian K. Kovak in a new working paper published by the National Bureau of Economic Research.
While an influx of immigrant workers can increase competition for jobs, low-skilled Mexican workers tend to move away when the local labor market becomes depressed, freeing up opportunities for native-born workers, the researchers find. Low-skilled American-born workers, on the other hand, are less responsive to changes in the labor market. “Low-skilled natives living in cities with a predominantly native-born workforce will become trapped in a very depressed labor market,” says Mr. Kovak.
Using data from County Business Patterns and the 2006-2010 American Community Survey, Messrs. Cadena and Kovak analyzed the effect of a low-skilled Mexican-born workforce on the employment outcomes of low-skilled native-born workers in 97 cities during the Great Recession.
Phoenix and Riverside had large Mexican immigrant workforces, while Detroit and Palm Beach had relatively small Mexican populations. According to the researchers, while all of these cities faced larger than average job losses, natives fared substantially better in Phoenix and Riverside, where departing Mexican workers absorbed much of the decline.
“This willingness to move where the jobs are is an understudied benefit for having a low-skilled immigrant workforce,” says Mr. Cadena.
The new research comes after the U.S. migration rate declined to historically low levels between 2008 and 2010. Incidentally, fewer Mexican immigrants have been heading to the U.S. in recent years as an improving Mexican economy has drawn more back home, The Wall Street Journal reported in June.