The U.S. economy shed 80,000 jobs in March — the biggest drop in five years, as weakness in construction and finance spread to a wider swath of occupations. (See the BLS report. [PDF] .) The March drop, along with revised figures showing sharper than previously reported declines in January and February, offer the most persuasive evidence yet that we’re in a recession.
We say: Not so fast!
The “other” employment survey — of households rather than businesses — shows a curiously mixed job picture for March.
Total employment fell 24,000 (-0.02 percent) from April
Hispanic employment fell 132,000 (-0.65 percent)
Non-Hispanic employment: rose 108,000 (+0.09 percent)
In fact, March is the latest of a string of months in which Hispanic workers lost ground relative to non-Hispanics. (So many Hispanics are foreign-born that we can use them as a proxy for immigrants, since the federal government chooses not to break out immigrant employment). The trend — call it reverse American worker displacement — started in late summer 2007 when housing construction started to tank. But this also was a period when federal authorities ramped up enforcement of the immigration laws. Immigration and Customs Enforcement (ICE) made 4,940 workplace arrests last year, a 13 percent increase from 2006. In 2002 only 510 such arrests were made. [Worksite Enforcement fact sheet, ICE] We opined that many illegals — especially those with criminal records — would self deport rather than risk being caught in an ICE bust. Their former employers are equally wary, having read media accounts of companies losing their entire workforce and paying hundreds of thousands of dollars in fines.
It’s too early to pronounce the reversal in Hispanic job growth as anything other than an economic phenomenon. That said, why haven’t non-Hispanics lost jobs at similar rates? Hispanic employment peaked at 20.6 million in September 2007. From that month through March 2008:
Total employment fell 291,000 (-0.20 percent)
Hispanic employment fell 350,000 (-1.70 percent)
non-Hispanic employment rose 59,000 (+0.05 percent)
The past six months marked the longest stretch of declining native displacement in seven years–as seen in our VDAWDI graphic:
Could enforcement be the explanation? Stay tuned.