The Impact of Immigration on the American Labor Force

When the story of immigration is told, the news that makes it to the general public is about illegal crossings on the southern border and the risk it poses to the security of the states and cities where the immigrants end up. 

But there is a positive side to immigration, especially legal migration, solving a labor crisis. 

The American labor force has been facing some unique challenges since the wake of the COVID-19 pandemic. The economy was hit hard, and many businesses had to downsize or close their doors. As the economy started opening up, the labor shortage problem became imminent as most former employees opted to resign. 

Immigration The Game Changer

However, immigration is playing a critical role in the growth of the American job market in recent years, with the Biden Administration promising to accelerate visa processing and promote humanitarian parole programs.

“Legal Immigration rates are below the pre-Trump era levels because of COVID-19 restriction implemented at the height of the pandemic. With COVID-19 restrictions slowly getting out of the way, the Administration’s efforts to accelerate visa processing and promote humanitarian parole programs will see the numbers rise significantly.” Says Attorney Mario Godoy of Godoy Law Office Immigration Lawyers.

The immigration rebound has been instrumental in keeping wage rates in check. Under normal circumstances, you would expect wage inflation to rise, but that’s not happening with low unemployment rates. But this is not happening, meaning another factor is at play in the labor force. One likely explanation is that immigrants are entering the workforce and filling positions. Immigrants are coming in and taking jobs. 

The Restaurant Industry Benefits the Most

The restaurant industry bore most of the brunt in the pandemic and post-pandemic. During the pandemic, most restaurants had to shut down, which meant lying off their employees. Most of these employees went to industries that were hiring, for example, the construction industry making rehiring a huge challenge for restaurant owners. 

According to Al Flores, the general counsel of Tex-Mex restaurants in the Houston area, their establishment was hit especially hard by the labor shortage. As of January 2023, the chain employed 2,500 people, 12 percent of whom work under the Deferred Action for Childhood Arrivals program, or DACA. Another 10 percent of the employees, temporary protected status, granted to people fleeing turmoil in their countries and lasted for several years. 

According to Flores, there has been a significant decline in the number of people getting permanent visas but an increase in the number of people working on a temporary protected status. This means that the workers have to move to other countries at some point if they cannot change their status, which is tough for employees.

Undocumented Immigrants in Agriculture

The agriculture sector is one of the few industries with unlimited immigrant visas, with the number of guest workers allowed rising by double-digit percentages each year for the past few years to reach approximately 371,000 workers in 2022. The industry also has some of the highest numbers of undocumented workers. 

According to the Labor Department, nearly half of the agricultural workforce is undocumented. 

Business and immigrant advocacy groups have proposed changes such as introducing a new visa category for non-skilled workers to ensure workers without a college education, such as cooks, farm workers, and cashiers, also have a path to legal citizenship. 

Unfortunately, these efforts, including efforts to have the DACA program enshrined in the law, have not borne desired fruits. However, according to Todd Schulte, chief executive of FWD.us, a pro-immigration group, their efforts are on track.