National Data | March Jobs— Is “Trump Effect” Reversing American Worker Displacement, Illegal Influx?


Virtually all MSM economics writers focused on the disappointing 98,000 job gain reported by the March Employment Survey released Friday. Rarely has Big Media missed the Big Story as thoroughly. Immigrant displacement of American workers increasingly appears to have reversed since the end of the Obama Administration—and illegal immigration appears to have collapsed.

Immigration patriots have been getting impatient with Trump. But this is one area where his mere arrival—and what used to be called “jawboning”—seems already to have had a beneficial effect.

Jeffrey Barash of MarketWatch was typical:

Many economists were skeptical the recent pace of job creation was sustainable after a six-year hiring boom that chopped the unemployment rate in half and ignited growing complaints among companies about a shortage of skilled workers to fill open jobs.

As a result, economists polled by MarketWatch had estimated the number of new jobs created in March would taper off to 185,000 in the third month of Donald Trump’s young presidency. Instead the decline was even steeper.

[U.S. jobs growth slumps to 98,000 in March, April 7, 2017]

 But the “other” employment survey, of households rather than employers, tells a different story – a story of robust growth with no sign that worker shortages are crimping U.S. employers, especially those willing to hire their own. Plus the Household Survey records immigrant status,

In March:

  • Total employment rose 472,000, up by 0.31%
  • Native-born employment rose 411,000, up by 0.33%
  • Foreign-born employment rose 61,000, up by 0.24%

Foreign-born workers held 16.94% of all jobs in March—down from 16.95% in February. Not since April and May of 2016 has the immigrant share of jobs been below 17% for two consecutive months.

We have a long way to go, of course. Native-born American workers lost ground to their foreign-born competitors throughout the Obama years, and this trend accelerated significantly in the months leading up to the election. The displacement of Americans by immigrants, which we measure by the extent by which immigrants have gained jobs at a faster pace than the native-born since January 2009, hit an Obama-Era high in August 2016.

In contrast, the first two full months of the Trump Administration saw native-born Americans gain 986,000 jobs, and immigrants lose 67,000.

While this “feels” like an inflection point—a reversal in the long-term trend of American worker displacement—the fact that it by no means undoes the damage of the prior eight years is brought out in our New VDARE.com American Worker Displacement Index (NVDAWDI) graphic:

OBAMA'S LEGACY: IMMIGRANT VS. AMERICAN EMPLOYMENT GROWTH

January 2009 though March 2017

(Monthly employment index: Jan. 2009=100)

*VDARE.COM AMERICAN WORKER DISPLACEMENT INDEX
Source: BLS Household Employment Survey; VDARE.com

Native-born American employment growth is represented by 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 in January 2009 for both immigrants and native-born Americans, and tracks their employment growth since then.

From January 2009 through March 2017:

  • Immigrant employment rose by 4.273 million, or by 19.7%. The immigrant employment index rose from 100.0 to 119.7.
  • Native-born American employment rose by 6.506 million, up by 5.4%. The native-Born American employment index rose from 100.0 to 105.4.
  • NVDAWDI (the ratio of immigrant to native-born employment growth indexes) rose from 100.0 to 113.6. (100X (119.7/105.4))

During the 96 months of Barack Obama’s tenure immigrant employment rose 4.2 times faster than native-born American employment—19.8% versus 4.7%.

During Trump’s first two full months, immigrant employment fell by 0.26%, while native-born employment rose by 0.78%.

The key variable in the displacement story: the foreign-born share of total U.S. employment. This rose steadily, albeit erratically, throughout the Obama years. It has fallen in President Trump’s first two months.

IMMIGRANT SHARE OF U.S. EMPLOYMENT

January 2009 through March 2017

Source: BLS Household Employment Survey; VDARE.com

In February 2009, Barack Obama’s first full month in office, 14.97% of all persons working in the U.S. were foreign-born. In his last full month, December 2016, 17.05% of workers were foreign-born. This implies that Obama-era immigration pushed as many as 3.16 million native-born Americans onto the unemployment rolls.

By contrast, the immigrant share of employment in March (16.94%) was 0.11% points below the share in Obama’s last month.

This implies that the mere threat of a Trump’s immigration crackdown may have already put 168,000 native-born American workers back to work.

Which is actually quite plausible, given the hysteria about Trump in the MSM. Some immigrants, legal and illegal, may have decided to leave. Others, above all illegals, may have decided not to come after all.

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. [PDF]

 

Employment Status by Nativity, March 2016-March 2017
(numbers in 1000s; not seasonally adjusted)
  Mar-16 Mar-17 Change % Change
  Foreign born, 16 years and older
Civilian population 41,148 41,204 56 0.14%
Civilian labor force 27,029 27,062 33 0.12%
 Participation rate (%) 65.7 65.7 0.0 %pts. 0.00%
Employed 25,741 25,857 116 0.45%
Employment/population % 62.6 62.8 0.2%pts. 0.03%
Unemployed 1,288 1,205 -83 -6.44%
Unemployment rate (%) 4.8 4.5 -0.3pts. -6.25%
Not in labor force 14,119 14,142 23 0.16%
Native born, 16 years and older
Civilian population 211,620 213,210 1,590 0.75%
Civilian labor force 131,825 132,850 1,025 0.78%
 Participation rate (%) 62.3 62.3 0.0%pts. 0.00%
Employed 124,997 126,771 1,774 1.42%
Employment/population % 59.1 59.5 0.2%pts. 0.00%
Unemployed 6,828 6,079 -749 -10.97%
Unemployment rate (%) 5.2 4.6 -0.6%pts. -11.54%
Not in labor force 79,795 80,360 565 0.71%
Source: BLS, The Employment Situation -March 2017, Table A-7, April 7, 2017.
PDF

 

Over the last 12 months (March 2016 to March 2017):

  • The native-born labor force grew six-times faster than the foreign-born labor force: 0.78% versus 0.12%. This rarely happened during the Obama era: drop-outs seem the be returning to the workforce—a Trump effect for sure.
  • Native-born employment rose 1.774 million, up 1.42%, while Foreign-born employment rose by 116,000, up 0.45%. Advantage native-born Americans
  • Native-born American unemployment rate fell by 0.6 points, a 11.5% drop; the immigrant rate fell 0.3 points, a 6.25% drop. Advantage native-born
  • The number of unemployed natives fell by 749,000, down 11%; the number of unemployed foreign-born dropped 83,000, off by 6.4%. Advantage native- born

Of course, the foreign-born are only the tip of the immigration iceberg. The true measure of post-1965 immigration impact on the labor market would include their U.S.-born children. My estimate: factoring in U.S.-born children virtually doubles (+ 80%) immigration’s depression of American wages.

But there’s still more good news: the population data. The immigrant working age population is estimated to have grown by just 56,000 over the past 12 months – only a fraction of 900,000-1 million figure commonly cited for legal influx of all ages.  That seems to confirm another sharp change noted in the February dataSince January 2016, immigrant workforce growth regularly exceeded estimated legal inflow, evidence of the surge of illegal immigration that occurred in Obama’s last year.

Needless to say, a couple months do not a trend make. It could be “statistical noise.” It could be that illegals who had formerly responded to the Household Survey, are more wary now. Or shielded in Sanctuary Cities.

Or have seen the writing on the wall, and left the country.

Now what if Trump really had stepped up deportation? work place raids? Implemented e-verify? Put the effort into an immigration cutback he’s wasting on healthcare, taxes?

Edwin S. Rubenstein (email him) is President of ESR Research Economic Consultants.