NCPA - National Center for Policy Analysis


May 3, 2005

Hispanic workers accounted for more than 1 million of the 2.5 million new jobs created by the U.S. economy in 2004. But Hispanics are the only major group of workers to have suffered a two-year decline in wages and they now earn 5 percent less than two years ago, according to a Pew Hispanic Center analysis of latest data from the Bureau of Labor Statistics and the Census Bureau.

Despite strong demand for immigrant workers, their growing supply and concentration in certain occupations suggests that the newest arrivals are competing with each other in the labor market to their own detriment, says the report's author Rakesh Kochhar. This "Mexicanization" of the U.S. job ladder?s lower rungs raises important political and economic questions:

  • Will support diminish for minimum-wage increases when most low-wage earners are immigrants who can't vote?
  • As industries like construction, food service, lodging and landscaping grow dependent on imported labor, will they face labor shortages if border security is tightened?

The Pew study supports the theory that immigrants are supplementing the U.S. work force, not pushing native-born Americans out of jobs. Native-born U.S. workers have become better educated and more ambitious in the past four decades and are now seeking higher-skilled, higher-paying jobs.

According to the Wall Street Journal, the flip side of lower wages for workers is that employers can use the savings to keep prices lower. Additional immigrant labor can provide stability in industries where labor shortages are endemic.

Source: Rakesh Kochhar, "Latino Labor Report, 2004: More Jobs for New Immigrants but at Lower Wages," Pew Hispanic Center, May 2, 2005; and Joel Millman, "Low-Wage U.S. Jobs Get "Mexicanized," But There's a Price," Wall Street Journal, May 2, 2005.

For text:,,SB111499066092821715,00.html

For Pew Study:


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