Hoover Daily Report

When Jobs Are Illegal, Only Illegals Will Have Jobs

Monday, March 15, 2004

My headline may exaggerate a bit but not much. The controversy over President Bush's immigration plan overlooks the fact that some of our illegal immigration problem arises from government regulations mandating unsustainable wages and benefits.

It sounds good to require employers to pay a "living wage" and provide health, parental leave, and many other benefits. But some workers are not economically productive enough to make those high-minded requirements cost-effective for the employer. Mandated benefits make the young, the low-skilled, and the poorly educated legally unemployable. Their jobs have been made illegal.

Since it is easier to recognize a problem when someone else is guilty, let's look at Europe. Most European countries have generous social safety nets partially provided by employers. Benefits such as six weeks of paid vacation, short workweeks, health care, and maternal leave all increase the costs of employing workers.

The result is that some people have fabulous jobs, and others have nothing. Workers whose productivity does not justify these compensation levels are out of luck. Unemployment in European countries has stabilized at 8 percent-a scandal by American standards. European youth (too young to have acquired skills commensurate with these compensation levels) spend years in universities, in socially enforced idleness, waiting to be allowed to do something genuinely useful.

In the meantime, there are still jobs for which no one is willing to pay the legally required compensation package. All over Europe, immigrants from North Africa and the Middle East do those jobs. These Muslim immigrants, barred from the higher-class jobs, are angry about their exclusion.

Of course, no one admits to planning this outcome. But that outcome is the inevitable consequence of years of legislation. European progressives have done a fine job of voting for bigger compensation packages. They break their arms patting themselves on the back for their compassion. But they conveniently overlook the fact that these compensation packages were purchased by cutting off the lower rungs of the job ladder. People who would have acquired valuable job skills and work habits no longer have the opportunity to do so.

Similarly, American teenagers hang out at the mall, while Mexican immigrants cut the grass and do the babysitting in the teenagers' middle-class neighborhoods. Suburban families prefer to pay those who work on a regular basis and who are often illegal; such work, which used to be a rite of passage for the young, has been made illegal by the imposition of mandated wages and benefits. How many American teenagers realistically need their own health benefits or paid parental leave?

In the 2003 legislative session alone, California passed eleven bills that the Chamber of Commerce considered "job killers," including increased health care requirements and increased costs of frivolous employee lawsuits. All this is in addition to California's expensive paid family-leave plan and inflexible wage and hour restrictions. Like their European counterparts, California progressives expect employers to solve all the problems of the world, including childcare and health care.

Immigration policy is a mess, no mistake. But until we address the problem of government's mandating unsustainable compensation levels, we will continue to have immigration problems. When we make jobs illegal, we ensure that only illegals will have those jobs.