The likes of Scott Beason continue to say HB56, the Alabama Anti-Immigration Law, is a “jobs bill” although this is contrary to all evidence. Based upon all available economic research and evidence, the Federal Reserve Bank declared “there is no evidence that immigrants crowd out U.S.-born workers in either the short or long run.” It further found that

Statistical analysis of state-level data shows that immigrants expand the economy’s productive capacity by stimulating investment and promoting specialization. This produces efficiency gains and boosts income per worker. At the same time, evidence is scant that immigrants diminish the employment opportunities of U.S.-born workers.

And concerning HB56, economists almost universally concur that:

Anti-immigration laws like Alabama’s are jobs and economic growth killers. It’s a tried and failed approach that plays well politically, but is based on flawed economic logic. Immigration laws are a way to tarnish and scapegoat people who don’t look or sound like us. – Dr. Scott Beaulier, executive director of the Johnson Center for Political Economy at Troy University

The reason for this is that, as Michigan economics professor Mark Perry says,

“There is no fixed pie or fixed number of jobs, so there is no way for immigrants to take away jobs from Americans. Immigrants expand the economic pie.”

What will HB56 do to Alabama’s economic pie?  A study by the Perryman Group, produced an “An Analysis of the Economic Impact of Undocumented Workers on Business Activity in the US with Estimated Effects by State and by Industry” provides some idea.

The study analyzes the net impact, on a state-by-state basis, of strict enforcement policies and laws like HB56 on state economies.  Dr. M. Ray Perryman, the founder and president of the firm, developed the US Multi-Regional Impact Assessment System (USMRIAS). “The model has been used in hundreds of significant and innovative studies over an extended period, and enjoys an excellent reputation for the reliability of its findings.”

The study concludes that if Alabama is sucessful and every undocumented immigrant self-deports, Alabama will lose over 18,000 jobs and 2.6 billion in economic activity. And that is a billion with a b. However, these numbers are even understated:

The Perryman Group measured losses if the undocumented workforce is removed for a static scenario (reflecting the immediate losses that would be associated with an enforcement-only type of program) and dynamic scenario (reflecting losses after time for market adjustments such as changing production processes and raising wage rates to attract additional workers).

If 18,000 lost-jobs across Alabama is not scary enough, consider that this number (the “dynamic scenario”) assumes policies are enacted which increase the number of legal immigrants (i.e. more temporary work-visas).

If an “enforcement-only” strategy is fully implemented, it
would effectively eliminate the undocumented workforce and,
thus, quickly lead to a situation much like that portrayed in the
static analysis. Moreover, if there were no contemporaneous
adjustments to provide for some level of entry, it would be
difficult to accomplish the adjustments embodied in the
dynamic results.

Therefore, with HB56 standing alone (the “static scenario”) without any “contemporaneous adjustment” at the federal level, Alabama stands to lose over 51,000 jobs and 8 billion in economic activity. (BTW, this is the present situation.)

Because of these staggering numbers, the analysts conclude:

The most compelling conclusions from this assessment are (1) the undocumented workforce is vital to US business growth and prosperity (and, in some cases, sustainability) and, thus, (2) an enforcement-only and removal approach is simply not viable. . .

The Perryman Group’s analysis indicates that the undocumented workforce has a positive effect on the economy, even when the costs of the undocumented immigrants are considered. In fact, if all undocumented workers were removed from the US economy, the immediate effect would be the loss of some 8.1 million jobs. Even after the economy adjusted, job losses would still exceed 2.8 million. Every state sees some level of negative impact, although the magnitude varies widely.

It is becoming more and more apparent that Dr. Keivan Deravi, an economics  professor at AUM and budget adviser to the Legislature, was right, HB56

“wasn’t supported by facts and wasn’t based on real economic theories and research.

Advertisements