When Jobs Are Illegal, Only Illegals Will Have Jobs
February 18, 2004
by Jennifer Roback Morse

Maybe my headline exaggerates a bit, but not much. In all the furor over Bush's immigration plan, one essential point has been overlooked. Some of our illegal immigration problem arises from government regulations mandating higher wages and benefits than the market can sustain. Many commentators recognize the gap between Mexican and American jobs as an immigration magnet. But few people make the connection that artificially high compensation levels, in and of themselves, create a market for illegal jobs.

Sure, it sounds good to require employers to pay a "living wage." It sounds all wonderful and progressive to insist that employers provide health benefits, parental leave and many other benefits. But stop and think about the workers whose productivity is not great enough to make that combination of wages and benefits cost-effective for the employer.

In the absence of government mandated wages and benefits, those low skill workers could have found jobs, less desirable jobs to be sure, but jobs just the same. The high-minded requirements increase the costs of employing the young, the low-skilled, the poorly educated. Those workers are now unemployable. At least, they are not legally employable. Their jobs have been made illegal. Those jobs will either be done by people with few scruples about breaking the law, or will not be done at all.

Since it is easier to recognize a problem when someone else is guilty, let's look abroad to see the consequences. Let's look at Europe.

Most European countries have generous social safety nets, partially provided by employers. Benefits such as six weeks of paid vacation, short work weeks, health benefits, and maternal leave all increase the cost of employing workers. American feminists look to European countries as models for what the U.S. government should require in order to support the ambitions of professional women. All their problems are solved by the state, either directly through state-funded benefits, or indirectly through government requirements upon employers.

But the cost of these wonderful benefits is that some people have fabulous jobs, while other people have nothing, far less than they would have had in the absence of the mandates. All these benefits have to be paid for by someone. Workers whose productivity does not justify these compensation levels are out of luck. Unemployment in European countries has stabilized at 8%, a scandal by American standards. Germany and Denmark have been hemorrhaging jobs, at a rate of 2% in the first half of 2003. European youth, too young to have acquired skills commensurate with these compensation levels, spend years in universities, in socially enforced idleness, waiting to be allowed to do something genuinely useful.

In the meantime, there are still jobs to be done for which no one is willing to pay the legally required compensation package. All over Europe, immigrants from North Africa and the Middle East do those jobs. France has allowed itself to be filled up with Muslim immigrants, who are and always will be excluded from the higher-class jobs, and who are and always will be, angry about being so excluded.

No one admits to planning this outcome, of course. But it is the inevitable consequence of years of legislation. The progressive people of Europe have done a fine job of voting themselves higher compensation levels. They break their arms patting themselves on the back for their compassion, and miss few opportunities to declare us stingy by comparison. But they conveniently overlook the fact that these compensation levels were purchased by cutting off the lower rungs of the job ladder. People who would gladly have accepted slightly worse jobs, have had to do without any employment at all. People who would have acquired valuable job skills and work habits no longer have the opportunity to do so. The only way to acquire human capital is through formal education.

In his excellent book, Mexifornia, Victor Davis Hansen makes a compelling case that the steady influx of illegal immigrants has displaced American youth from simple jobs like lawn care and babysitting. He creates an unforgettable image of American teenagers hanging out at the mall while Mexicans cut all the lawns and babysit all the kids in their neighborhood. The children of the middle class are not learning the habits of work, thrift and industry that used to be the norm. That first job taught generations of Americans how to show up on time, how to get along with the boss, and a thousand and one little facets of the world of work. Now, kids hang out at the mall, waiting for the world to tell them they are finally grown up enough to work at something that matters.

But even an observer as astute as Hansen does not see the deeper connection between the idle American youth and the illegal Mexican workers. Jobs that used to be rites of passage for the young have been made illegal by the imposition of mandated wages and benefits. In the 2003 legislative session alone, California passed eleven bills that the Chamber of Commerce considered "job killers," including increased health care requirements and increased costs of frivolous employee lawsuits. One narrowly defeated bill would have outlawed employer discrimination against cross-dressers. All this is in addition to California's expensive paid family leave plan, and inflexible wage and hours restrictions.

How many American teenagers realistically need their own health benefits or paid parental leave? Like their European counterparts, California progressives expect employers to solve all the problems of the world, including child care, health care, and the tender psyches of transvestites.

Immigration policy is a mess, no mistake. And Bush's plan is a mess too. But unless and until we address the problem of government mandating unsustainable compensation levels, we will continue to have immigration problems. When we make jobs illegal, we ensure that only illegals will have those jobs.

Jennifer Roback Morse is a research fellow at the Hoover Institution at Stanford University. She is the author of Love and Economics: Why the Laissez-Faire Family Doesn't Work.