National Data: American Worker Finally Catch A (Brief) Break — But New Immigration Surge Continues

05/10/2015

Goldilocks came home in April. After a rough first quarter in which GDP stalled and employment briefly nosedived, U.S. businesses added 223,000 payroll jobs in April. The unemployment rate fell from 5.5% to 5.4% — the lowest level since mid-2008. The number of people who entered the labor force in search of work also rose, a sign jobs are easier to find.

There is, however, a conspicuous weak spot in this economy: wage growth. Wages rose a scanty 0.1% in April. By this time in the recovery cycle gains of 3.0% per year are the norm. The influx of low wage foreign-born workers is undoubtedly a factor — albeit unacknowledged by the Main Stream Media — in keeping wages low.

April was one of those rare months in which native-born American workers crawled out of their foxholes, grabbing jobs at significantly higher rates while immigrants were losing them. The “other” employment survey, of households rather than businesses, reports 192,000 new jobs were added last month, with native-born Americans running the table. But the long term trend, of immigrants displacing Americans, remains intact.

In April:

Total employment rose by 192,000 — up by 0.1%
Native-born employment rose by 438,000 — up by 0.4%
Foreign-born employment fell by 246,000 — down by 1.0%

Needless to say, one month of good news does not undo years of bad. American workers have lost ground to their foreign-born competitors throughout the Obama years, and despite April’s job pop, the trend has accelerated over the past year. This is made clear in our New VDARE.com American Worker Displacement Index (NVDAWDI) graphic:

Native-born American employment growth is the black line, immigrant employment growth is in pink, and NVAWDI — the ratio of immigrant to native-born American job growth — is in yellow. The index starts at 100.0 for both immigrants and native-born Americans in January 2009, and tracks their employment growth since then.

From January 2009 to April 2015:

Foreign-born employment rose by 3.161 million, or by 14.5%. The immigrant employment index rose from 100.0 to 114.6.
Native-born American employment rose by 3.141 million or by 2.6%. The native-born American employment index rose from 100.0 to 102.6.
NVDAWDI (the ratio of immigrant to native-born American employment growth indexes) rose from 100.0 to 111.7 (100X(114.6/102.6)

The key variable is the immigrant share of total U.S. employment. In Barack Obama’s first full month in office (February 2009) 14.97% of all persons working in the U.S. were foreign-born, according to that month’s Household Employment Survey. Since then the foreign-born share has risen steadily, albeit erratically.

The immigrant share of total employment fell to 16.70% in April, the lowest level since July 2014. Despite the decline, the long-term displacement trend is intact: in only eight of the 76 months of Obama’s tenure have immigrant workers accounted for a greater share of U.S. employment than they did last month.

April’s immigrant employment share was 1.71 percentage points above the level recorded in February 2009, the first full month of Mr. Obama’s administration.

With total employment now at a record 148.5 million, every one percentage point rise in the foreign-born employment share translates to as many as 1,485,000 displaced native-born workers. Implication: Obama-era immigration may have pushed as many as 2.54 million (1.71 times 1,485,000) native-born Americans onto the unemployment rolls.

A detailed snapshot of American worker displacement over the past year is seen in the “Employment Status of the civilian population by nativity” table published in the monthly BLS report:

Employment Status by Nativity, April 2014-April 2015(numbers in 1000s; not seasonally adjusted)
	Apr-14	Apr-15	Change	% Change
	Foreign born, 16 years and older
Civilian population	38,391	39,997	1,606	4.2%
Civilian labor force	25,127	26,103	976	3.9%
Participation rate (%)	65.5%	65.3%	-0.2%	-0.3%
Employed	23,713	24,819	1,106	4.7%
Employment/population %	61.8%	62.1%	0.3%	0.5%
Unemployed	1,414	1,284	-130	-9.2%
Unemployment rate (%)	5.6%	4.9%	-0.7%	-12.5%
Not in labor force	13,264	13,895	631	4.8%
	Native born, 16 years and older
Civilian population	209,049	210,268	1,219	0.6%
Civilian labor force	129,718	130,451	733	0.6%
Participation rate (%)	62.1%	62.0%	-0.1%	-0.2%
Employed	122,054	123,769	1,715	1.4%
Employment/population %	58.4%	58.9%	0.5%	0.9%
Unemployed	7,664	6,683	-981	-12.8%
Unemployment rate (%)	5.9%	5.1%	-0.8%	-13.6%
Not in labor force	79,330	79,817	487	0.6%
Source: BLS, The Employment Situation — April 2015, Table A-7, May 8, 2015.PDF

From April 2014 to April 2015:

The foreign-born civilian labor force — the number of immigrants working or looking for work — rose by 976,000 (up by 3.9%), while the corresponding native-born labor force rose by 733,000 (up by 0.6%) The immigrant labor force grew six times faster than the native-born workforce.
Immigrant employment rose by 1.106 million, or 4.7%; native-born employment rose by 1.715 million, or 1.4%. In percentage terms, immigrants gained jobs at three times the rate of native-born Americans.
Unemployment rates fell for both immigrants and Americans; at 4.9%, however the immigrant unemployment in April 2015 was below the 5.1% native-born. Advantage immigrants.
The Labor Force Participation Rate [LPR], a sign of worker confidence, fell for both native-born and immigrants. At 62.0%, however, the native-born LPR remains well below that of immigrants (65.3%.) Advantage immigrants

Once again we are struck by the foreign-born population figures. The Labor Department estimates that 1.606 million immigrants of working age (16 and over) entered the country between April 2014 and April 2015. That is well above the figures Homeland Security reports for new legal entrants entering annually. As before, we ask: is another immigration surge under way?

Meanwhile, the native-born American population of working age grew by a mere 0.6% — one-seventh the growth rate of the immigrant worker population over the same 12 months.

Edwin S. Rubenstein is President of ESR Research Economic Consultants.

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