September 22, 2011

Rick Perry's Texas Miracle (Americans need not apply)

Steve Camarota has done a very useful piece of research for the Center for Immigration Studies:
Governor Rick Perry (R-Texas) has pointed to job growth in Texas during the current economic downturn as one of his main accomplishments. But analysis of Current Population Survey (CPS) data collected by the Census Bureau show that immigrants (legal and illegal) have been the primary beneficiaries of this growth since 2007, not native-born workers. This is true even though the native-born accounted for the vast majority of growth in the working-age population (age 16 to 65) in Texas. Thus, they should have received the lion’s share of the increase in employment. As a result, the share of working-age natives in Texas holding a job has declined in a manner very similar to the nation as a whole. 
Among the findings: 
Of jobs created in Texas since 2007, 81 percent were taken by newly arrived immigrant workers (legal and illegal).  
In terms of numbers, between the second quarter of 2007, right before the recession began, and the second quarter of 2011, total employment in Texas increased by 279,000. Of this, 225,000 jobs went to immigrants (legal and illegal) who arrived in the United States in 2007 or later.  
Of newly arrived immigrants who took a job in Texas, 93 percent were not U.S. citizens. Thus government data show that more than three-fourths of net job growth in Texas were taken by newly arrived non-citizens (legal and illegal).  
The large share of job growth that went to immigrants is surprising because the native-born accounted for 69 percent of the growth in Texas’ working-age population (16 to 65). Thus, even though natives made up most of the growth in potential workers, most of the job growth went to immigrants.  
The share of working-age natives holding a job in Texas declined significantly, from 71 percent in 2007 to 67 percent in 2011. This decline is very similar to the decline for natives in the United States as a whole and is an indication that the situation for native-born workers in Texas is very similar to the overall situation in the country despite the state’s job growth. 
Of newly arrived immigrants who took jobs in Texas since 2007, we estimate that 50 percent (113,000) were illegal immigrants. Thus, about 40 percent of all the job growth in Texas since 2007 went to newly arrived illegal immigrants and 40 percent went to newly arrived legal immigrants.

A commenter in the one newspaper that has covered this study argues:
In reading the study, they came up with 2 sets of findings depending on how they compared the data: gross vs net showed 29% immigrant growth taking 81% of the new jobs and a net vs net comparison showed 31% immigrant growth taking 54% of the new jobs. The second finding is the more valid comparison (as noted above) but only the first is being reported in most of the media reports and headlines. 
An interesting part of their conclusion: 
"This analysis shows that job growth was significant in Texas. But, depending on how one calculates the impact of immigration, between 2007, before the recession began, and 2011 more than three-quarters or more than half of that growth went to immigrants. This is the case even though the native-born accounted for more than two-thirds of the growth in the working-age population. Some may argue that it was because so many immigrants arrived in Texas that there was job growth in the state. But if immigration does stimulate job growth for natives, the numbers in Texas would be expected to look very different. The unemployment rate and the employment rate show a dramatic deterioration in the Texas for the native-born that was similar to the rest of the country. Moreover, if immigration does stimulate job growth for natives, why have states that received so many new immigrants done so poorly in recent years? (See Table 2.) For example, unemployment in the top-10 immigrant-receiving states in 2011 averaged 8.7 percent, compared to 8.1 percent in the other 40 states. Moreover, unemployment is 7.2 percent on average in the 10 states where the fewest immigrants arrived since 2007. These figures do not settle the debate over the economics of immigration. What they do show is that high immigration can go hand in hand with very negative labor market outcomes for the native-born. And conversely the native-born can do relatively well in areas of lower immigration."

So, I'm going to suggest caution in quoting that 81% figure. You can read the report here and make up your own mind.

In a 2006 VDARE.com article, I explained why the then-current boom in Las Vegas wasn't doing American workers much good:
What [economist David] Card doesn't grasp is that illegal immigration is denying Americans the traditional wage premium for undergoing the pain of moving to a boomtown.{NYT writer Roger] Lowenstein can't see it either, as he writes: "Immigrants do help the economy; they are fuel for growth cities like Las Vegas …"
Imagine you are an American blue-collar worker in Cleveland, making $10 per hour. You know the local economy is stagnant, so you're thinking about relocating to fast-growing Las Vegas. But your mom would miss you; and you're not a teenager anymore so you don't make new friends as fast as you once did; and you really like the wooded Ohio countryside you grew up around and the fall colors and the deer hunting; and there's this girl that maybe you could get serious about, but her whole family is in Cleveland and she'd never leave. 
So, you decide, you'll leave home behind if you can make 50 percent more in Las Vegas, adjusted for cost of living. That seems fair. 
But, then you look through the Las Vegas want ads and discover you'd be lucky to make 10 or 20 percent more because the town is full of illegal aliens. They're moving from another country, so it's not much skin off their nose to move to Las Vegas rather than some place slower-growing. 
Well, forget that, you say. I'll stay in Cleveland. 
Unfortunately, too many economists forget that too. They can't—or won't—put themselves in other people's shoes and see how the world really works. 
That doesn't seem to hurt them professionally. But it can hurt America.

42 comments:

Anonymous said...

What does he have to lose from touting the Texas miracle, because it's not like Democrats would ever call him on this?

anony-mouse said...

Move to ND instead. Its more like Ohio than Las Vegas is (next door MN has all the trees and lakes you'd like) and lots fewer illegals than NV (or OH). Lower unemployment rate, and you're job is not dependent on a cyclical industry like gambling.

That solved that problem.

Next?

Tony said...

Yeah ok so? Perry aint that great but he's better than what we got now. If not Perry than who? And dont say Ron Paul. I'm talking about somebody who has a real chance to win the nomination and beat obama.

Anonymous said...

anon-ymouse - yeah, maybe but surely you understand the general point thats being made?

Gabe Ruth said...

"The share of working-age natives holding a job in Texas declined significantly, from 71 percent in 2007 to 67 percent in 2011." Is this a strange way of saying the native born unemployment rate in Texas is about 30%, or am I missing something?

Also, averaging two sources:

http://krugman.blogs.nytimes.com/2009/12/10/the-jobs-deficit/

http://seekingalpha.com/article/294274-here-s-why-the-u-s-needs-16-000-000-jobs-yesterday

we need 160,000 jobs to be created A MONTH to keep up with population growth (in the whole country). Texas contains about 8% of the population... so 279,000 jobs over FOUR YEARS, and they are a shining example of job creation... either I'm missing alot or we're in bigger trouble than even Derb thinks. Can anybody straighten me out?

JerseyGuy said...

Steve,
When Paul Krugman and Robert Reich were criticizing the Texas model (GDP growth driven largely by population growth), they were essentially arguing against mass immigration. Suprisingly, many of the New York Times readers pointed this out. Nothing much came out of it though.

Another big factor driving wages down has been the "race to the bottom" economic policies implemented largely by low wage states against higher wage states. Essentially, lower wage states employ industrial policies to pick industries off of other states, including anti-union legislation. However, these states still are largely the poorest in the U.S. Michael Lind has written alot about this.

Piper said...

"Libertarian economists" like Bryan Caplan constantly argue that immigration reduces native unemployment (i.e., helps more natives get jobs) by boosting the division of labor.

Empirical facts constantly refute that theory. Do open-borders advocates reëxamine their arguments? No, certainly not. They are not about to let facts get in the way of a fine-sounding theory.

JSM said...

"anon-ymouse - yeah, maybe but surely you understand the general point thats being made?"

I'm betting not, since (s)he doesn't seem to understand much about ND, either.

ND is booming because of the oil drilling of the Bakken Formation.
I live in WY, so I know all about the boom-bust (i.e., cyclical nature) of the oil / nat gas drilling industry. Oil drilling is NOTHING if not cyclical.

When the oil price is up, you can't get a rig. When it's down you get lots canceled drilling plans, ergo, lots of formerly employed roughnecks.

Also, we've got lots of mestizos in WY, and more coming every day. The imminvasion is spreading, and North Dakota will succumb, too, soon enough.

No, Mousey, moving to ND does NOT solve that problem. Your next Great Idea?

Bob Arctor said...

"If not Perry than who? And dont say Ron Paul. I'm talking about somebody who has a real chance to win the nomination and beat obama."

Real Clear Politics rolling poll averages have Paul only three points down on Obama, tied with Romney for first place among GOP contenders. The supposedly more electable Perry, on the other hand, is a whopping eight points down on Obama at the moment.

Perry is extremely popular in professional conservative movement circles, and all in all that's very understandable, but that popularity hasn't seemed to rub off on the general electorate just yet, if it ever will.

jody said...

steve, there is a boom going on right now in north dakota, due to the oil shale. you should check that out. unemployment is like 2% and wages for every job are way up. an average truck driver can make $100,000 a year. it is in the barren, undeveloped western part of the state. there are so many workers in the area they have no place to live. blue collar guys going up there have to live in tents or literally in their cars and trucks.

and the winter is positively brutal.

but there's few immigrants taking these jobs. pretty much all old stock americans doing these hard, backbreaking jobs "americans won't do".

read it said...

"Of jobs created in Texas since 2007, 81 percent were taken by newly arrived immigrant workers (legal and illegal)."


Very interesting.

I would like to see the percentage breakdown for all the other states especially New York and California, the other two giant states filled with immigrants.

It would be nice to see a nice neat table like AE did for TANF usage.

Anonymous said...

"Of jobs created in Texas since 2007, 81 percent were taken by newly arrived immigrant workers (legal and illegal)."


So, Texas created 50% of new jobs. 81% went to immigrants. That is still about 10% of all new jobs in America for natives and Texas has less than 8% of the US population. Meanwhile other states are bleeding jobs for Americans and still hiring immigrants.

It goes to show that you don't have to be awesome to be the best. You just have to be better than the competition. Texas has a huge border with Mexico that the Federal gov't will not close. What excuse do all the other states have. LIfe gave Texas lemons and they made lemonade. Is it the greatest possible utopia imaginable? No, but compared to how much the others suck, it comes out on top. That is what is so pathetic.

EYE OF HORUS said...

If these facts get transmitted to the Voters of America, then Slick Rick Perry's Campaign is Over - Finito - Kaput!
Immigration is basically going to be THE ISSUE for 2012. Its too bad that Tom Tancredo has not entered the Republican Nomination Race. He's just the kind of Anti-Immigration Candidate that Americans are looking for in a President...

Anonymous said...

"The share of working-age natives holding a job in Texas declined significantly, from 71 percent in 2007 to 67 percent in 2011."


Sucks doesn't it?

The national labor participation rate is only 58% which sucks even more.

Just goes to show that even the dumb capitalist can beat commies.

Anonymous said...

we need 160,000 jobs to be created A MONTH to keep up with population growth (in the whole country). Texas contains about 8% of the population... so 279,000 jobs over FOUR YEARS, and they are a shining example of job creation... either I'm missing alot or we're in bigger trouble



We're in bigger trouble.

Of course the media can't say that because they are infatuated with Obama.

jody said...

this might be a good time to analyze that forbes list of american billionaires for 2011.

a quick peruse shows there are still very few asians on that list, like between 1% and 2% of the billionaires. and no mexicans.

most of the people on the list earned a good amount of money between 2010 and 2011 despite the general economic decline in the US. so, many of america's wealthy are using this flood of immigrants for cheap, wealth producing labor.

JerseyGuy said...

Whenever talking to a free market economist, the conversation goes like this:

Me: "So I wanted to get your thoughts on this very complicated issue..."
Free market economist: "The answer is the market! Now what is the rest of the question?"

Beats the hell out of actually thinking...

Anonymous said...

Yet these very same illegals contribute tremendously in terms of productivity and they get paid low wages for it. Who do you think benefits from this? Almost everyone.

Gabe Ruth said...

That almost is doing alot of work there, buddy.

I forgot to mention, Ron Paul is the only guy I would consider voting for. Even if Perry was the best "electable" candidate, I really don't know what he would accomplish besides kicking the can down the road, and that would be if he succeeded beyond the wildest dreams of movement conservatives.

slumber_j said...

jody said...

"this might be a good time to analyze that forbes list of american billionaires for 2011.

"a quick peruse shows there are still very few asians on that list, like between 1% and 2% of the billionaires. and no mexicans."

You make a good point, or points. Then again, the trans-nationality of the truly sick-rich makes them not so easy to peg. Carlos Slim (the "Mexican" Arab-Mexican investor in the NYT among other very American things) probably doesn't show up as an American rich person. On the other hand, he did buy maybe a year ago the enormous Fifth-Avenue house on the same block as my daughter's school.

How does one categorize Carlos Slim, then? To what degree are these super-rich people "from" or "of" anywhere?

Whiskey said...

I'd venture most Texas job creation was the middle class of Mexico, such as it was, fleeing to Texas to open up restaurants, bars, and so on and employing ... wait for it ... NO GRINGOS! Only family members.

Perry only leads Romney in SC by three points.

Paul? He figures a border fence with Mexico is BAD: it might prevent Americans from fleeing down to Mexico. There's stupid. And then there's Ron Paul stupid. No I'm not kidding.

Romney is the best guy out there with a shot that has said anything negative about illegal immigration. He's yes RINO tastic, but this is about lifeboat time, not chocolate vs. caramel.

Reg Cæsar said...

NoDak is booming, but is preparing for the bust that is sure to come. How many extractive states do that?

Also, Hispanics and the Dakotas are no strangers to one another, what with a century of migrant workers passing through.

I remember meeting a couple of INS agents temporarily relocated from the Grand Forks office during the great flood. They were conversing in Spanish!

Anonymous said...

Paul? He figures a border fence with Mexico is BAD: it might prevent Americans from fleeing down to Mexico. There's stupid. And then there's Ron Paul stupid. No I'm not kidding.

A border fence is not necessary if the government followed Paul's advice and did not give out welfare, education and other benefits to illegals.

In addition, the idea that the US government might prevent people from leaving is not as absurd as you imply. It appears Congress has already passed legislation that taxes the crap out of anyone who wishes to give up their US citizenship. So technically a 'virtual wall' has already been built to try to keep us in.

eh said...

For business reasons, I flew into Dallas from Europe four times in 2010. Each time, the plane was half full of Indians, which at first I found quite surprising. Many of them seemed to be Mom and Dad, right off the Punjab, perhaps going to visit their kids. Or maybe they had already gotten green cards due to family connections. Who knows? Another sad moment realizing that yet another corner of America was being demographically washed away by the immigration tsunami. I would've thought Texans would put up more of a fight than the quiche-eating, white wine drinkers in California.

Anonymous said...

.I wonder what percentage of jobs went to second generation immigrants?
In all probability there are fewer 'old stock' Texans working now than 20 years ago.
Exactly the same thing happened in Britain during the last Labour(!) Government's 'open borders' imigration policy - statistics show that a pitifully small proportion of new jobs went to native Britons - there are certainly millions less native Britons in work now than 30 years ago.
The moral is that uncontrolled immigration does exactly what intelligent people always said it would do - the simple and obvious fact that it destroys wages, conditions and eventually whole nationalities(their pride won't let them live like coolies).Of course those 'clever' economists who argue otherwise are talking shit.That's the real moral 90% of economists just talk shit - there is more wisdom in the drivel of babies.

Paul Mendez said...

Yet these very same illegals contribute tremendously in terms of productivity and they get paid low wages for it. Who do you think benefits from this? Almost everyone.

First, "hard working" plus "low wages" does not always equal "productive." I've seen some amazingly bad construction work done by illiterate peasant immigrants who can't read instructions or understand the basic principles of indoor plumbing.

Second, who benefits? The employer. Not the consumer, who gets stuck paying the external costs of illegal immigration through higher taxes and a lower standard of living.

Paul Mendez said...

Yeah ok so? Perry aint that great but he's better than what we got now. If not Perry than who?

I am no Romney fan, but it is blatantly obvious that if he is able to win the GOP's nomination, Romney will absolutely crush Obama in 2012.

The Blue States said...

LIfe gave Texas lemons and they made lemonade. Is it the greatest possible utopia imaginable? No, but compared to how much the others suck, it comes out on top. That is what is so pathetic.

Ouch.

Malcolm said...

Just another Politician looking for the most votes. Believes in nothing but votes.

beowulf said...

It appears Congress has already passed legislation that taxes the crap out of anyone who wishes to give up their US citizenship. So technically a 'virtual wall' has already been built to try to keep us in.
Right, that's what makes Ron Paul's position so absurd. The US taxes its citizens on their worldwide income. Uncle Sam doesn't care if you stay or go, he's still getting his cut.

Whiskey is right, Romney is the best of the lot, he's practically running on Pat Buchanan's platform-- border fence, E-verify, employer enforcement and tariffs on China. He supports cutting payroll taxes to stimulate the economy and his plan to eliminate capital gains tax on incomes under $200K makes him a New Dealer compared to the rest of the GOP field, who wish to eliminate it entirely (half of all the capital gains go to the wealthiest 0.1 percent.).
To his credit, Romney is running as a Sailer-Davis-Nixon Republican. :o)
http://thenewnixon.org/wp-content/uploads/2009/10/richard-nixon-sammy-davis-jr.jpg

Anonymous said...

". Some may argue that it was because so many immigrants arrived in Texas that there was job growth in the state. But if immigration does stimulate job growth for natives, the numbers in Texas would be expected to look very different."

It is undoubtedly stimulating job growth. The important metric however, is net jobs growth. In that regard the answer is clearly no.

"Is this a strange way of saying the native born unemployment rate in Texas is about 30%, or am I missing something?"

Participation rate and the unemployment rate are two different numbers. Participation rate compares the full population(including unemployable people) vs those with jobs. The unemployment rate meanwhile is a blatantly manipulated lie where anyone who hasn't directly looked for a job in the past 3 weeks is considered unemployed.

poolside said...

My suburb of Houston is filled with Chinese, Indians and increasingly, Muslims from the Middle East.

There are entire well-to-do neighborhoods that are 100 percent Indian or 100 percent Chinese.

It's tough to spot a native Texan these days.

Tony said...

"I am no Romney fan, but it is blatantly obvious that if he is able to win the GOP's nomination, Romney will absolutely crush Obama in 2012."

Not so fast. Romney is a Mormon, which a lot of bible belt people arent comfortable with. They won't vote for obama. They just won't come out and vote period.

Anonymous said...

So maybe our immigration policy is a ponzi scheme?

Anonymous said...

"Not so fast. Romney is a Mormon, which a lot of bible belt people arent comfortable with. They won't vote for obama. They just won't come out and vote period."

You're saying that instead they'll stay home and let a black "Muslim" slightly to the right of Lenin get re-elected?

We'll have no problem winning the South this time. But if we nominate a guy like Perry, millions of Americans will have George W. Bush flashbacks, and won't vote for him. I won't vote for him. Perry has made it quite clear that the prosperity of the current citizenry so long as he and his billionaire patrons can have "growth." Despite having thrown a bone or two to the enforcement crowd, to fool them into believing he's on our side, it is quite obvious he is not - he's for in-state tuition, against local enforcement, against a border wall, against E-Verify.

I'm done with him and with Republicans like him. I would sooner vote for Obama. Hell, if Perry is the nominee I may very well give money to Obama, just to make my point.

jody said...

the oil boom in ND is going to last a long time relatively speaking. the field they are working on is developed on a time scale of decades. it's not like the oil fields of 100 years ago in pennsylvania and texas. it has MUCH more oil locked up in there, but it's also much slower and more involved getting it.

i've used this analogy before, but getting the oil out of the ground in ND is like supplying new york city with water by desalinating sea water from the atlantic ocean - through a straw. a near endless supply of liquids, but coming in at a trickle.

decades to go before they even have a lot of "straws" in operation up there in the bakken.

Anonymous said...

Kennedy decisively won the South in 1960 despite him being Catholic. What makes people think a mormon like Romney can't do the same in 2012? Most of the people I talk to who are vehemently against voting for a mormon are religious black democrats who won't be caught voting Republican in a million years.

Svigor said...

Yeah ok so? Perry aint that great but he's better than what we got now. If not Perry than who? And dont say Ron Paul. I'm talking about somebody who has a real chance to win the nomination and beat obama.

Wait, what? How is Perry better than Obama? Perry seems more likely to push through an open-borders agenda with a Republican congress than Obama does.

"I am no Romney fan, but it is blatantly obvious that if he is able to win the GOP's nomination, Romney will absolutely crush Obama in 2012."

Not so fast. Romney is a Mormon, which a lot of bible belt people arent comfortable with. They won't vote for obama. They just won't come out and vote period.


Which parts of the "bible belt" do you think vulnerable? 'Cause I'm going to start with a default of "none" on this one.

Captain Jack Aubrey said...

Perry's performance in Texas is par for the course. Just over the course of the summer Texas's unemployment rate climbed from 8.2% to 8.5%, even as the overall US rate was basically stable.

It's the same thing we saw in the last decade before the crisis hit: people at the top were doing very well, but the lower- and middle-class were pretty much stagnant, income-wise. It is a reminder, as if we needed any, that mass immigration does nothing to really benefit Americans. Some immigrants make superb conributions to our competitiveness - Sergei Brin, et. al. But the contributions of those immigrants get swamped by the costs of all the rests, from overbreeding illegalls to Mohamed Atta. The real point is that the average human capital of the American population is falling rapidly.

I'm dubious about not just Perry, but Romney, too. Although he's exploited Perry's weakness on immigration, Romney's own web page says absolutely nothing about immigration enforcement - and I'm talking about a page with a 100+ page PDF document outlining his plans for America. Check tthe full PDF for "Jobs" and you'll see references to "Admitting the Best and the Brightest" and letting more foreign graduates of US universities stay (pages 126-127) but no mention whatsoever of enforcement. None. Romney's a better bet than Perry, I'm sure, but he needs to be pressed to make promises on this. He's just another businessmen who sees economic growth as a recruitment problem - if you have bad workers, replace the workers.

Tony said...

"You're saying that instead they'll stay home and let a black "Muslim" slightly to the right of Lenin get re-elected?"
Thats what happened in '08 with McCain who was not a good conservative candidate but was solidly anti abortion, was an honorable POW, and picked a running mate favorable to the religious right. The religious right staying home made the difference in Va,NC, IN, Oh, and a few others out west.

David said...

Why don't you mail a letter to your fav candidates (whoever it is), instructing him or her to close the borders?

It will have an effect...if you remember to enclose a $50 million check in the envelope.

ben tillman said...

The real point is that the average human capital of the American population is falling rapidly.

That's right, and not just on a per-capita basis. The nation changes from one in which the whole is greater than the sum of the parts to one in which the whole is less than the sum of the parts. And all the while the sum of the parts continues to decrease as well.