Increase in illegal workers reduces wages, and increases the burden on social services. Supply and Demand; Labor Markets; Income Distribution and Poverty

Subject: increase in illegal workers reduces wages, and increases the burden on social services

Topic: Supply and Demand; Labor Markets; Income Distribution and Poverty

Key Words: Illegal Immigration, Labor Market, Poverty, Hispanics, Regulation

News Story

Since September 11, 2001, U.S. border patrols have increased significantly. Patrols have increased so much that the cost to cross illegally from Mexico into the US has increased to about $1,500 since 1995. This increase has had an unlikely effect: Workers who entered the US illegally are reluctant to try to cross back into Mexico during the winter, and therefore stay in the US permanently. In Stockton, California, workers cram into small apartments, sleeping wherever space is available.

This non-exodus has caused a drain on the social services provided by communities with high populations of illegal immigrants. Montezuma Elementary School in Stockton currently serves over 1,100 students, about four times its optimal capacity; hospitals are forced to write off medical bills of those uninsured and unable to pay their bills; and children born in the US to illegal immigrants are eligible for welfare assistance.

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Further, the illegal immigrants' permanent habitation has also caused wages to plummet. Wages for farm workers have fallen from $6.98 in 1989 to about $6.18 in 1998, causing not only Mexican workers to live in poverty, but also cutting American farm workers' income.

Part of the problem lies in the fact that, while the government has implemented stricter controls on border crossings, enforcement in the workplace has dwindled significantly. In other words, if immigrants make it across the border illegally, then it is highly likely that they will be able to remain for a significant period of time. If these individuals remain in poverty, it is unlikely that they will try to return to Mexico anytime soon, because of the...