Immigrants Have Been Critical Drivers Of The United States Economy Based On Two Reasons

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Immigrants have been critical drivers of the United States economy based on two

reasons: first, they provide low wage labor to American formal and informal sectors. More

importantly, unlike the United of America citizenry immigrants are not choosy, and they engage

in odd jobs. Further, employing immigrant workers does not require formal documentation such

as contracts which encourages farmers with vast farm fields. Another significant contribution by

immigrants in America can be seen in the catering industry. As President Trump administration

push the agenda to remove illegal immigrants there will be some harsh effect on the American’s

economy. It is expected that there will be significant loss in the economy due to withdrawal of

cheap labor and

From an economist perspective, the rules of demand and supply determine a country’s

economy at any given time. In this regard, if President Trump’s immigration laws are

implemented such as constructing the Mexican wall and deporting illegal immigrants the supply

of workers will decrease. With the increased demand for foods, farmers will experience labor

shortage and will find it challenging to feed Americans. There will be an increased demand for

labor and a decrease of supply of labor resulting to high wages and low productivity.

Furthermore, there are indicators that there will be adverse economic consequences to the

United States Economy due to withdraw from labor. Profit making organizations such as King of

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Teas Roofing Company have experienced labor shortage due to the new immigration rules. The

construction of Mexican wall will limit immigration which is a significant source of cheap labor

in the United States. However, the effects of labor economics in the United States will affect

Mexican workers and households in Mexico. Notably, the United States labor market is popular

among immigrants due to higher wages (compared to Mexico) and market stability. The

Congress has made some attempts to prevent the effects of immigration on the economics of

labor. By May, there were about 700,000 vacant positions in the restaurant and accommodation

sector. There is a high job opening rate which has been stated to be at 5.1 %, the highest since

2001 according to the Labor Bureau Statistics.

A survey conducted by the Associated General Contractors has shown that 86% of

American construction companies are struggling to fill vacant positions of Carpenters,

electricians and other work positions. It is expected that there will be a 40% jump for home aides

in the next decade, in the healthcare setting according to Labor Department. Trump and the

Alabama senator Jeff Sessions complain of many people entering America, and they say that the

influx of the foreign workers is sapping the wages and job prospects. The US employers say that

Americans don’t want the kind of odd jobs that the foreigners do. Due to lack of the skilled low-

waged labor workers, has shown Braddy of the Texas Roofing increase wages from $17.65 per

hour to $20 per hour.

Most eateries in the United States are catered for by Mexicans. According to

Mr.Hargrave, the founder of Tacolicious, the industry of the eateries in the US can’t survive

without Mexicans. He gives an example of Mr. Ek a Mexican who had worked for him and said

such workers do not come over to seek employment lately. Mr. Johnson, a fruit farmer, says the

outcome from his business was better off when he had workers than machines. Lack of labor

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made him purchase machines which do not distinguish ripe fruits from unripe. The strong

bureaucratic rules in the registration centers at the Mexican-American border delays the arrival

of workers to the farms in the US making significant losses as crops perishes in the farm fields.

The labor shortage in the United States is further contributed by the aging population and

the trends towards blue-collar jobs and education. In fact, research by Associated General

Contractors of America established that even in the absence of immigrants it is increasingly

difficult to find low skilled workers in America. It is quite absurd that despite the influx of

workers the Trump administration is still pursuing to remove illegal immigrants in the states.

As a reactionary measure of labor shortage industries and farm have turned on

technological. When firms prefer the use of technology that are less labor-intensive the

employment levels decline. Moreover, the technological innovation may have detrimental

effects on the American casual workers. According to research, price inflation lowers the real

minimum wage between congressional actions. Regional differences in wages disrupt real

minimum wage. For a specified nominal minimum wage, the difference in prices in regions

differentiates the real minimum wage. The real minimum wage is different in Alaska, where

prices are high compared to Mississippi where they are low. An increase in the level of

employment due to an expansion of the economy can lead one to conclude that minimum wage

increment does not affect employment effects. In a growing economy, reduction in the rate of

growth of employment can be as a result of a one-time increase in the minimum wage.

When assumed that all labor costs are variable, the agents will consider it costly to

change behavior when demand or supply changes. For this reason, workers find it difficult to

adjust employers and firms find it expensive to hire or fire workers. This model implies that we

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tend to shift from the frictionless market model. For a company to make a profit it has to choose

wage and employment levels correctly. The first thing is to use employment level to maximize

profit and then use supply curve to determine the wage necessary to attract the number of

workers that can maximize profit.

After firms acquire employees, there is need to train them. Training can be either

specific or general. Training will increase the productivity of labor. The condition for training

for workers is that the worker must stay in the firm after training. Workers demand leisure.

Leisure is an opportunity cost for a company. Wage increase affects both income and

substitution. Substitution and income work in opposite directions to create ambiguity in

predicting the overall labor supply. Taking consideration of all these factors, labor supply is

expected to drop drastically in the USA in the next 20 years according to my own opinion. If the

immigration policy can’t be changed and then the law against illegal immigration is implemented

according to trump, the labor industry will decline. A decline in the labor industry will mean law

productivity in the United States.

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Works cited

Jordan, Miriam and Santiago Pérez, “Small Businesses Lament that there are Too Few Mexicans

in U.S., Not Too Many” The Wall Street Journal, November 28, 2016,

http://www.wsj.com/articles/smallbusinesses-lament-there-are-too-few-mexicans-in-u-s-

not-too-many-1480005020 (accessed 11/19/2017)

Works cited

Jacobs, Jane. The death and life of great American cities. Vintage, 2016.

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