President Obama’s Executive Action on Immigration Will Improve the Wages and Working Conditions of Unauthorized Immigrants and U.S.-Born Workers Alike

The internet and Twitter have virtually exploded over President Obama’s scheduled announcement tonight at 8 p.m. EST, regarding the actions he will take to reform the immigration system without Congress, relying on the legal authority he has to execute the laws of the United States. Most of the discussion surrounding this has focused on: 1) what the substance of the reforms will be and, regarding the most important reform—shielding unauthorized immigrants from deportation—estimating the share of the unauthorized population that will be eligible; 2) whether the executive reforms are lawful without a legislative directive from Congress; and 3) how the reforms will impact American politics (including whether there will be a government shutdown and if the reforms will “poison the well” for cooperation between Republicans and Democrats on other topics).

Tonight we’ll find out the exact substance of the reforms. And I’ve already discussed at length here and here how temporarily removing the threat of deportation (also known as “deferred action”) for up to four or five million unauthorized immigrants who have resided in the United States for at least five or ten years, and granting them employment authorization—is well within the bounds of the president’s legal authority to act. The Constitution allows the president prosecutorial discretion to enforce the law selectively when he has limited resources available to him, and he’ll be targeting those resources more effectively if he focuses the government’s immigration enforcement machinery on criminals and terrorists, rather than otherwise law-abiding immigrants who have deep ties to the nation and U.S. citizen children and spouses. Regarding the political impacts of the action, I’ll leave that up to the political analysts and prognosticators. But the one aspect that receives too little attention is the positive impact that deferred action and work authorization will have on the wages and workplace bargaining power of the unauthorized immigrant workers in our labor market who might qualify for the president’s new deferred action.

It’s not hard to understand the benefits. According to a landmark study and survey of thousands of workers, 37 percent of unauthorized immigrant workers were the victims of minimum wage law violations at the hands of their employers (meaning they were not paid the legally required minimum wage). A whopping 84 percent who worked full time were not paid for overtime, i.e., the legally required time-and-a-half rate for the hours they worked in a week beyond 40 hours.

Survey data show how the lives of young people who qualified for DACA, Obama’s existing deferred action initiative from 2012, have improved as a direct result of it. The unauthorized immigrants who qualify for Obama’s new, expanded deferred action and work authorization will, for the first time, have the same legal protections as those protected under DACA, and where they’ll count most is in the workplace. Those who qualify will be able to work legally and increase their earnings, either with a better-paying job or by demanding they be paid the minimum wage and for overtime. If their employer fails to comply, the newly-authorized workers will be empowered to complain to authorities without fear of employer retaliation or deportation. The workers would also be able to access the court system in order to compel an employer to pay the amount they’re owed.

The Center for American Progress estimates that across the board, unauthorized immigrants will see their wages rise by 8.5 percent on average. To illustrate, imagine a janitor in California who earns $7.00 an hour. If that janitor becomes work authorized and can begin working legally and earning the California minimum wage of $9.00 an hour, that represents a 28.6 percent increase in pay. Add in overtime pay, and it’ll be more.

This is obviously good for the unauthorized immigrant worker. But even if you don’t care about that, you should know that U.S.-born workers would also reap important benefits.

According to the aforementioned study on low-wage workers, U.S.-born workers also suffer disastrously high rates of minimum wage and overtime violations. 15.6 percent of low-wage-earning U.S.-born workers experienced minimum wage violations and 68.2 percent weren’t paid properly for their overtime hours. Those numbers suggest that most low-wage workers in the country are being exploited regardless of their legal status, and the total amounts lost to wage theft are truly staggering. But the bargaining power of U.S.-born workers competing in the low-wage labor market is especially undercut because the millions of unauthorized workers cannot safely complain about workplace violations or file a lawsuit to enforce the law. When the immigrants’ wages are unfairly held down, so are the wages of U.S. workers competing for the same jobs and hours.

Even after reforms are implemented and millions of workers come out of the shadows and begin exercising their rights, there will still be far too many exploitable immigrants and Americans in the labor market. That still needs to be addressed, but the more workers who have rights and are paid higher wages, the better.

The country won’t have a permanent solution until Congress steps up and passes a legislative immigration reform package that legalizes all unauthorized immigrants who are deeply integrated into the fabric of American society, and provides them with a path to citizenship. That reform package must also thwart a new flow of unauthorized immigrants by including a rational and cost-effective electronic employment verification system and by authorizing funds to dramatically increase labor law enforcement, and make key reforms to temporary foreign worker programs to prevent visa overstays and keep employers of guestworkers from putting downward pressure on wages. Until then, any executive actions President Obama takes will simply be a down payment on the necessary labor market improvements the country needs.

Powerful people oppose improving the labor market through executive action because they believe unauthorized immigrants are “law breakers” and solely to blame for coming to the United States in search of a better life without permission. That’s one part of the equation, but it ignores and absolves the other responsible parties. Major elements of American society abetted the creation of a large population of unauthorized immigrants, including major industries such as agriculture, meat packing, and construction, which came to rely on unauthorized workers. For decades, U.S. employers recruited and illegally hired workers from abroad for low-wage jobs with impunity. Unauthorized immigrants entered the country without inspection at the border in order to take those jobs, or overstayed temporary visas. The U.S. government also played a major role: Democratic and Republican administrations ignored the problem and failed to adequately enforce existing laws. Congress itself got the ball rolling when it passed an immigration reform law in 1986 that included a paper-based “I-9” employment verification system that is easily susceptible to fraud and difficult to enforce. And the legalization program the 1986 law included wasn’t nearly broad enough; it failed to legalize millions, which left behind the core of today’s unauthorized population.

Employers, unauthorized immigrants, and the government must now share the blame equally, but only Congress can fix this for good.


  • tuhaybey

    That certainly coincides with the empirical data. States with many undocumented immigrants tend to have median incomes about $5k higher than states with few undocumented immigrants- http://politicsthatwork.com/graphs/undocumented-immigrants-median-income But when you look at all immigrants- documented and undocumented- the figure jumps to $11k higher- http://politicsthatwork.com/graphs/foreign-born-population-median-income

    To me, that suggests that bringing people out of the shadows is a very good thing for the economy.

    • wm

      The statement: ” we need a rational and cost-effective electronic employment verification system and by authorizing funds to dramatically increase labor law enforcement, and make key reforms to temporary foreign worker programs to prevent visa overstays and keep employers of guest workers from putting downward pressure on wages.” can be agreed to by nearly all–unless you are here illegally. The references given by tuhaybey are bogus. They show if you work in a high cost state you on average get paid more–nothing else.

      Democrats want cheap votes and a few businesses think they want cheap labor. The victims here are the American Taxpayers who have to support all these low skill workers who will never pay enough taxes to pay for all the services they receive. Low skilled workers and the Welfare State are incompatible. The great increase in GDP touted by Obama et. al. that all these illegal workers becoming “legal” is phony. Indeed, because of the way GDP is defined they will slightly increase GDP because more of them will be on the books. But, since they work at low skilled jobs (all they are qualified for) with low pay the GDP/person, the one
      that counts, will decrease because they will be earning far less the average wage paid in the US. Of course all this increased income they are receiving is “stolen” from our own low skilled workers. The National Research Council (part of the National Academy of Science) in their book “The New Americans; Economic, Demographic and Fiscal Effects of Immigration” showed that the average Hispanic/ Latino family COSTS the state, local and federal governments about $5,000/year over and above what little taxes they pay. This result is not surprising considering according to PEW almost 50% of Hispanics are the equivalent of high school drop outs and will in nearly all cases earn income in the bottom 40% of all salaries–the same group that gets the vast majority of all subsidies. A welfare state and low skilled immigration are not compatible.

      Real immigration reform would cut the immigration to the US to less than 500,000/yr (its now over 1,000,000/yr), only accept workers who have the equivalent of a BS degree or equivalent for citizenship or green card, require real citizenship status checks to get a job and disqualify all illegal immigrants from ever getting citizenship or even being considered. These types of workers would contribute to the US economy instead of costing us money.