You are really twisting things to make your argument sound plausible in the general case. More supply means less wages. Why focus on low paying jobs? Are you seriously suggesting that if we import every software engineer from India that wants to come here that my salary will increase? If so, that's very interesting why tech CEOs are lobbying so hard for this.
Your "more supply equals lower wages" argument is demolished by top economic research. A recent NBER study calculated that "immigration, thanks to native-immigrant complementarity and college skill content of immigrants, had a positive and significant effect between +1.7 to +2.6% on wages of less educated native workers" between 2000-2019.
The economy isn't zero-sum. As Milton Friedman noted, "most economic fallacies derive from the tendency to assume that there is a fixed pie, that one party can gain only at the expense of another." Immigrants create demand for housing, food, education, entertainment, and specialized services that natives often provide.
Historical evidence consistently disproves the fallacy: When women entered the workforce, it didn't cause massive job losses among men. When segregation was abolished, Black workers didn't cause mass unemployment among whites. The vast majority of Americans descend from immigrants who contributed to economic growth.
Research on H-1B visas shows that firms that get immigrant labor end up "hiring more tech workers and paying them more, because they become more efficient and sometimes scale up." In fact, studies show each H-1B worker creates approximately 1.83 jobs for native-born Americans.
The UK's Migration Advisory Committee, after reviewing studies from 2003-2018, concluded that "immigration had little or no impact on average employment or unemployment of existing workers" and "little impact on average wages."
The overwhelming consensus among economists is that immigration grows the economic pie rather than merely redistributing slices. That's why America's most immigrant-rich cities consistently have the highest wages, not the lowest.
PLEASE, I am begging you. Spend 15 minutes reading actual economic research before posting confidently incorrect Econ 101 oversimplifications. The "immigrants take our jobs" fallacy has been debunked by virtually every reputable economic study for the past 30 years. This isn't some fringe academic view. It's the overwhelming consensus of actual economists who study this for a living. Your intuition about "more workers = lower wages" seems logical but falls apart when tested against actual economic data. The real world is more complex than a supply-and-demand graph from an introductory textbook.
Nowhere in the economic research does it explain what you are so confidently stating, that wages are, somehow, the only thing in all of economics where positive supply shocks do not matter. The arguments that tend to be made are that, on a long enough time horizon, mean wages increase because overall economic output goes up, and mean economic output goes up because there is a higher supply of available labor.
You're fundamentally misunderstanding both the economic research and my argument. No one is claiming wages are "the only thing in economics where positive supply shocks don't matter."
The research shows that labor markets aren't simple supply-demand curves because of complementary productivity effects and gains from specialization, selection effects, and, of course, demand generated by the immigrants. If you have general labor size increase, in general equilibrium with a responsive central bank interest rates will lower to keep employment tight.
This isn't about "long enough time horizons" - studies find positive or neutral effects in the short and medium term too. The fundamental issue is that your model assumes a fixed economic pie that immigrants simply divide into smaller slices, when in reality immigrants help grow the pie overall.
Okay. Which other things don't see effects from positive supply shocks? You're just restating my premise about time horizons. The pie grows, with time, if a bunch of other things happen in the right order. Wages haven't grown in two decades in the UK, your original example. So, how are you defining short and medium term? Three decades?
man idk, maybe it was the long conservative rule after the crash? Maybe it was the long austerity? Maybe it was the huge mass of natives that voted to crash out of an agreement with a bloc that handles over 80% of their trade?
More seriously...
- for US: The newest NBER IV estimates put the wage effect of all 2000-19 US immigration at +2 % for non-college natives. Show me a UK study of similar vintage that finds anything near –2 %.
- for UK: UK real wages tracked productivity one-for-one after 2008; BoE and NIESR pin that on capital deepening, Brexit and austerity. Not on immigration, which the MAC finds moved wages by _at most_ –1% (aggregate, not yearly!) and the final report was ~0.1%, basically a null finding.
- We've already been through lump of labor, so I don't know why you've been banging on equilibrium.
And to finally address your time horizons: Short-run? Mariel-style shocks still show null effects. Medium-run? 2009-20 UK data flips positive. Long-run? Productivity wins. Pick your horizon. Immigration is at worst a rounding error next to TFP, which is positively associated with migration.
Happy to dive deeper, but at this point the burden of proof is on anyone claiming large negative wage effects. The best evidence, across multiple methods and countries, just isn’t there.
Got a link to that NBER study? It's not that I don't believe you or think you're making it up, but I would like to understand what instrumental variable they were using to make the claim that an increase of low skilled immigration makes wages for non-college educated natives go up.
I skimmed this and read a few sections closely. Most econometric papers spend too much time rambling on about stuff that most people who actually seek out and read these things already know. Anyway, +2.6% in wages for non-college educated natives, over 20 years, is not a ringing endorsement. I honestly doubt anyone would notice this, and over two decades that's just noise, frankly. If I'm understanding one of the central claims correctly, it's not that low skilled immigrants "took" jobs from natives, it's that natives ended up working more, and as a result their earning power increased. That's ... also not a ringing endorsement. Sure, you didn't get fired in favor of an immigrant, but you had to take a second shift to stay in the game. Wow what a benefit.
I'm also going to quibble a bit with how they constructed this Instrumental Variable. The way it's constructed, the higher the turnover (for lack of a better term) from native to foreign, the better the predictor it is (because in their theory, it's exogenous to wages at the local level). Does anyone really believe this? Immigrants respond to incentives just like anyone else. They're not choosing to immigrate to Sac City, Iowa, or any other low-COL/low-wage town, for a reason. It also doesn't answer my original question, which was central to my initial claim: why? The "why" is going to answer a lot of other layered questions about hostility to ever-increasing immigration. Are firms moving in that exploit low-wage immigrants, generating other adjacent economic activity? Probably! Not controlled for or referenced at all in this, and this paper is by no means a definitive conclusion that high low-skill immigration is good (even on a two decade timeline, which even typing that is just absurd).
The +2.6% is hourly pay, not extra hours; it’s the difference between flat wages and one more year of raises. Every credible quasi-experiment, from Denmark’s refugee lottery to U.S. enforcement crackdowns, confirms that more immigrants leave natives at least as well paid, often better off, because firms invest, prices fall and natives climb the job ladder. Shift-share IVs have been combed over by three separate methodological papers and pass; drop them and refugee lotteries STILL give you the same answer. UK stagnation is a productivity story (zoning, anyone?), not an immigration one. So unless you have a better identification strategy that overturns all of these results, the weight of the evidence says immigration grows the pie, and natives get a slice (if you can't believe any synergy than at least just bearing a smaller share of defense spending).
I'm also going to flip it around for a second. As I said with the Mariel boatlift study, where a 7% increase in the labor force yielded more or less no impacts on hyperlocal labor force, even considering (possible? I know little havana right now is mostly spanish but idk what it was back then) language and skills barriers. How do you explain that? That is the most short term of local supply shocks with basically no short term employment or wage impact. Thirty-five years of re-checks (Card 1990 → Borjas 2015 → Clemens-Hunt 2019 → Peri-Yasenov 2019 → Lewis et al.) still show more or less zero effect on native wages or jobs (once you fix compositional glitches in Borjas’s sample). If a shock that extreme can’t push wages down, the `more workers = lower pay` story is busted.
Yeah I got that part, maybe you're misreading. You seem to be interested in advertising that you've read all this stuff, which is great, a lot of people have. But you aren't really addressing the problem statement, so I'll state it clearly: no one gives a shit about a 2.6% hourly wage increase over 20 years. They don't care because immigration comes with a bunch of other externalities, that are very near term, that academics deliberately remove from their models. "Natives get a slice ... of 1.7-2.6% ... over the course of 20 years" is not a convincing argument, which is why most of the quantitative debate about immigration is largely academic. If the benefits were so obvious we wouldn't need a team of nerds to tell us that, well, actually your hourly wages do go up ... eventually. Insofar as you care about some sort of policy outcome here, you are going to have to figure out a different way to frame this.
I'm not familiar with zoning laws in the UK to comment, so, sure. Maybe a byzantine zoning bureaucracy is the problem there, that does ring distinctly "British" to me.
I haven't read the Mariel study, and honestly I don't really have any interest in it because the underlying story is that Cubans just replicated their own economic structures in a hyper-contained locality, with significant ethnic solidarity given a shared history of hardship. Again, there's qualitative aspects to this that economists - especially the econometricaly inclined - struggle with.
> Cubans just replicated their own economic structures in a hyper-contained locality, with significant ethnic solidarity given a shared history of hardship
Damn if only there was a way to study assimilation. Wait, there is, we have, and if you look a few replies up you'll see that its basically a complete success with sufficient NGO support that vastly boosts social participation.
> If the benefits were so obvious we wouldn't need a team of nerds to tell us that, well, actually your hourly wages do go up ... eventually.
This kind of thinking leads to Trump. Unironically. Handwaving about "if it were real I'd know of it" is what leads to terrible economic policy.
Well, if it were real people wouldn’t have voted for Trump. What you’ve presented is, like I keep saying, the most unconvincing tidbit of minor benefits. You seem totally uninterested in addressing the problem, that no one cares about this study and what it says because it’s such a tiny effect on the margins, utterly impossible to translate into daily life.
I’ll keep making whatever claims I want, and you can keep gatekeeping (or attempting to) as much as you like (now I really won’t read the Mariel study, nevermind that you are conditioning success on Uncle Sam handing over money to make it work). The force with which state something as plainly obvious only appears as such inside the spreadsheets, so enjoy them.
spite driven willful ignorance is something that I didn't expect to find when starting this conversation.
I'm mostly looking for you to retract your claim about how short-run supply shocks must obviously show up in wages and employment.
EDIT: also nowhere does it require fiscal outlays for assimilation, the single biggest thing is expedited provision of work permits, which is obviously fiscally positive.
Strawman. You're talking about wages and jobs in aggregate which wasn't my argument at all. Nothing you said addresses how my salary is affected in the industry the person is joining.
Sure, in total, other jobs may be created and growth is increased -- it's essentially a tautology.
I don't know why you think you're entitled to any particular job due to government policy, that seems like a really poor and inefficient way to run an economy.
