Immigrants, Jobs and Local Economies: Not So Simple

By Lisa Howard

During the early days of the Great Depression, when many Americans were desperate to find jobs, state and local officials in the United States began forcibly repatriating Mexicans, including American citizens of Mexican descent, to Mexico. Between 1929 and 1935, hundreds of thousands of Mexicans left the United States. Some estimates put the number at 500,000 to over a million.

Latino farmworkers 1930s

Mexicans picking cantaloupes in Imperial Valley, California, May 1937. Although the intent of Mexican repatriation was to create more jobs for Americans, a UC Davis study shows most native-born workers didn’t take the jobs left behind by Mexican laborers. (Credit: Dorothea Lange, Farm Security Administration, Library of Congress)

Professor Giovanni Peri, the chair of the Department of Economics at UC Davis, was curious. Did the jobs left behind by Mexicans end up being filled by Americans? Did the forced repatriation improve the economy?

Peri and Jongkwan Lee, a research fellow at the Korea Development Institute, and Vasil Yasenov, a postdoctoral scholar at UC Berkeley’s Goldman School of Public Policy, published their working paper, “The Employment Effects of Mexican Repatriations: Evidence from the 1930s,” in Fall 2017.

“We looked systematically at how these repatriations affected local economies,” Peri said. “What was the job growth for American cities in the subsequent decade? What were the wages? How did they change? And what type of jobs did Americans get as a consequence of the Mexican repatriation?”

The researchers found no evidence that the employment of Americans grew faster (or declined more slowly) in cities and counties where a large number of Mexicans had been removed or left.

“If anything,” Peri said, “there is evidence of the opposite. Communities where a large number of Mexicans were repatriated tended to suffer more job losses and had less employment growth for American workers.”

Peri explained that the Mexican population at that time was particularly specialized in jobs as laborers and farm laborers, what he refers to as “manual workers at the bottom of the wage distribution.” When that group left, few Americans took those jobs and the losses ended up creating a domino effect.

“Jobs connected to these lower-level jobs disappeared as well. Farms need laborers, but they also need workers like craftsmen who make tools. If a farmer can’t get his fruit picked, he doesn’t need to buy boxes,” Peri said.

The same was true in manufacturing. “Factories had laborers, but they also had clerks, accountants, craftspeople and managers. When you take away a bunch of laborers, you can create a negative multiplier effect. A few of them, yes, became laborers. But most of them just lost their jobs because firms closed or relocated,” Peri said.

NPR and Alabama poultry workers

Peri is director of the Migration Research Cluster, an interdisciplinary network of UC Davis economists, sociologists, political scientists, historians, demographers and law scholars working on issues related to international migrants and migration.

Giovanni Peri

UC Davis economist Giovanni Peri (Lisa Howard/UC Davis)

Studies from the interdisciplinary researchers in the Migration Research Cluster often reveal data that go against popular narratives.

In 2017, Peri completed a study for the popular NPR radio program This American Life. Host Ira Glass asked Peri to research whether an influx of immigrants into Albertville, Alabama, during the 1990s and 2000s had taken away poultry jobs from Americans and driven down wages for American workers. It was for a two-part segment by Glass and Miki Meek called “Our Town.

Peri used census data going back to 1980, 1990, 2000 and 2010 and compared Albertville to similar towns in Alabama that didn’t experience a large influx of immigrants.

“We found there was not very much difference in the employment and unemployment levels for people with low education between Albertville and elsewhere after 1990 when many immigrants arrived,” Peri said. “Native-born workers did not seem to have been displaced by this inflow of immigrants in Albertville.”

He also found that wages generally weren’t worse than elsewhere. Other factors, such as mechanization, outsourcing and decline of labor unions, were holding down wages for low-paid workers and low-education workers during this time.

The immigrants did, however, boost Albertville’s economy. The new arrivals needed homes, stores, haircuts and gas. Their jobs at the poultry farm fueled over businesses.

The data from Peri’s studies have been consistent. “Local economies thrive and grow on a multiplicity of jobs. More immigrant jobs actually help create more American jobs, not the other way around,” Peri said.

More information

The Employment Effects of Mexican Repatriations: Evidence from the 1930s (National Bureau of Economic Research)

This American Life, “Our Town” (National Public Radio)

UC Davis Migration Research Cluster

The original version of this story can be found here: Research from UC Davis Migration Research Cluster Shows Deporting Immigrants Hurts Local Economies (UC Davis Office of Research)

Lisa Howard is a writer with the UC Davis Office of Research

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