The Myth of a Labor Shortage

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By USDR

Congress is currently considering immigration reform packages that include work permits for those in the country illegally, as well as substantial increases in future legal immigration. Many in Congress argue that the country needs more workers. Yet a new analysis of government employment data by the Center for Immigration Studies shows an enormous number of working-age Americans not employed, particularly those with modest levels of education who are among the poorest Americans.

“There is a profound disconnect between what Washington is doing on immigration, and what is actually happening in the U.S. labor market,” said Dr. Steven Camarota, CIS Director of Research. “Across the labor market the employment situation remains dismal, with the percentage of working-age Americans not working at a record high. Yet the Senate passed a bill that gives work permits to millions of illegal immigrants and also doubles the number of foreign workers allowed into the country.”

View the entire report at http://cis.org/u6-measure-still-no-evidence-of-labor-shortage

Among the findings:

The share of working-age (18 to 65) natives holding a job has not recovered from the Great Recession. In the fourth quarter of 2013, 31 percent were not working, something that has barely improved in the last five years.

In the fourth quarter of 2013, there were only two working-age natives holding a job for every one that was not employed. This represents a huge deterioration. As recently as 2000, there were three working-age adults holding a job for every one not working.

The total number of native-born working-age adults (18 to 65) of any education level not working (unemployed or out of the labor force) was 50.5 million in the fourth quarter of 2012 — 8.8 million more than in the fourth quarter of 2007, and 14.7 million more than in the same quarter of 2000.

Looking at the less-educated, only 38 percent of working-age adult natives who have not completed high school were employed in the fourth quarter of 2013. Back in the fourth quarter of 2000, 52 percent of these natives had a job.

Even among adults who had completed high school, but had no additional schooling, just 65 percent had a job at the end of 2013. Back in the fourth quarter of 2000, 74 percent worked.

Some of those not working do not wish to work, but looking at the broad measure of unemployment (referred to as U-6) shows that unemployment was 28.7 percent for native-born adults who have not completed high school and 16.5 percent for those with only a high school education. The U-6 measure includes those who want to work, but have not looked recently, and those forced to work part-time.

The Center for Immigration Studies is an independent, non-partisan, non-profit research organization founded in 1985. It is the nation’s only think tank devoted exclusively to research and policy analysis of the economic, social, demographic, fiscal, and other impacts of immigration on the United States.