Economist: Law would hike wages in Hazleton (Hazleton Standard-Speaker)

By KENT JACKSON
Staff Writer

SCRANTON — Enforcing Hazleton’s ordinance to prevent employers from hiring illegal immigrants will increase wages for legal workers, a Harvard economist testified Monday in a trial about the law’s constitutionality.

Professor George Borjas based his testimony on his national research showing a 10 percent increase in immigration triggers a drop in wages of 3 to 4 percent. Wages declined 8 percent in one study of low-skilled workers from 1980 to 2000, he said.

Borjas, who emigrated from Cuba in 1962, was the first witness called by the city in the trial that began March 12.

The American Civil Liberties Union, the Puerto Rican Defense and Education Fund and other plaintiffs are still presenting their case but allowed Borjas to testify out of order to meet his travel schedule from Massachusetts.

The groups sued to prevent the city from enforcing the ordinance, which they claim interferes with the federal right to set immigration law and discriminates against Latinos.

Attorney Ilan Rosenberg for the plaintiffs objected to Borjas testifying as an expert, saying Borjas’ opinion isn’t relevant to the case because Borjas hadn’t done research in Hazleton or Pennsylvania.

Asked by an attorney for the city, Kris Kobach, if economists commonly apply national standards to draw local conclusions, Barjas said they do.

Judge James M. Munley, who issued a restraining order against Hazleton’s law and will decide the case in U.S. District Court for the Middle District of Pennsylvania, agreed to let Borjas testify.

Borjas testified that a raid on a chicken processing plant in Georgia illustrated the interplay between immigration and wages.

After federal authorities apprehended three-fourths of the workforce at the Crider plant in Stillmore, Crider increased wages about 14 percent.

Asked by Rosenberg if the raid created an unusual circumstance, Borjas said, “Yes,” but added that Swift meatpacking also increased wages after a raid by immigration authorities.

Rosenberg asked if Borjas knew whether immigration increased the workforce by 10 percent in Hazleton – he didn’t know – but if it rises that much, how much above the national minimum wage would hourly pay increase?

“Twenty cents,” Borjas said.

Rosenberg also asked about research in Italy that actually found wages rose after immigration.

Borjas said the Italian study found wages rose for native-born workers, but immigrants in Italy before the study began absorbed a huge decline. When averaging those results, which Borjas did in his research in America, the results are not far apart, but he agreed that views of economists on the findings or the methods to use aren’t unanimous.

He said Hazleton’s law would increase wages even if imperfectly enforced and even if applied just to people hired after it takes effect rather than on people currently working in the city.

“There are still people not hired, still people coming to the (job) market. These people are affected,” he said.

Any effect on wages he said would be in the short term and in the long term, factors such as the migration of legal workers and new employers to Hazleton would even out wages.

Borjas said the short term could last years but he didn’t think it would end as quickly as three months.

Told by Rosenberg that people already might have left Hazleton because the ordinance was approved, though not enforced, Borjas said the short-term effects might already have begun.

His analysis did not consider legal workers leaving because of the animosity they felt in Hazleton after city council approved the ordinance.

Kobach asked if he was surprised that the U.S. Chamber of Commerce opposes Hazleton’s law – an endorsement that the plaintiffs list in their favor. Borjas said he wasn’t. The chamber represents employers who have an interest in low wages, he said.

“My conclusion is an influx of illegal immigrants will have an effect of decreasing the wage of competing workers. Their wages would have been better had this never taken place,” Borjas said.