Study Entrants cost AZ workers $1.4B a year
Capitol Media Services
Jan. 8, 2008

By Howard Fischer

Tucson, Arizona | Published:

Arizona workers lose $1.4 billion in wages a year because companies here hire illegal entrants, according to a study commissioned by the Maricopa County Attorney's Office.

George Borjas, a professor of economic and social policy at Harvard University, also concluded that foreigners in the state illegally have reduced the employment rate of legal Arizona residents.

Hardest hit in both wages and job availability, he said, are high school dropouts who, at the bottom of the wage scale, are the ones most likely to be competing with illegal immigrants.

The study is being presented to U.S. District Judge Neil Wake, who is hearing a challenge to a new state law making it illegal to knowingly employ illegal border crossers.

David Selden, lead attorney for businesses seeking to overturn the law, on Monday dismissed the study as meaningless.

He said it makes irrational assumptions that if all the illegal workers left, they would be replaced immediately by legal U.S. residents moving here from other states. Even if that eventually were true, he said, Arizona's economy would be in a shambles by the time that happened.

Maricopa County Attorney Andrew Thomas conceded that the study, paid for by taxpayers, did not look at what benefits there might be to the state economy by having so many illegal immigrants and their families here, both in filling jobs and paying taxes.

Selden instead wants Wake to pay attention to another study, which was done by Judith Gans, immigration policy program manager at the Udall Center for Studies in Public Policy at the University of Arizona. Gans' report concluded that the costs of illegal immigration in Arizona are more than offset by the state tax revenues generated by their presence.

But that study also has its limits. While concluding illegal immigration costs $1.4 billion a year for education, health care and law enforcement, it puts the benefits to Arizona of all immigrant workers at $2.4 billion. Gans does not, however, limit her benefit analysis to just those here illegally.

Selden acknowledged that shortcoming but said the figure is impossible to compute.

The competing studies are legally irrelevant to the question of whether the law, known as the Legal Arizona Workers Act, is constitutional. But they are crucial to efforts by business advocates and activist groups to persuade Wake to block enforcement of the law until the federal court challenges are all heard.

Both Wake and the 9th U.S. Circuit Court of Appeals have so far refused to suspend enforcement of the law, which took effect on Jan. 1. But that is based on assurances from county prosecutors that they won't bring charges before Feb. 1. Wake has scheduled a hearing for next week and promises to have a ruling by then.

Thomas said the Borjas study shows why he should be allowed to enforce the law, most specifically the conclusion that low-skilled legal workers are being paid 4.7 percent less than they would otherwise make if they were not competing against illegal immigrants.

"Enforcement of the employer-sanctions law will help to protect and potentially increase wages in Arizona, especially among lower-skilled workers," Thomas said.

But Selden noted the state's relatively low jobless rate, as well as the fact that the figures in the Borjas study put the impact that illegal entrants have on wages at less than 50 cents an hour for a $10-an-hour job.

Selden also said that even if Borjas is correct, his study doesn't consider how enforcement might affect companies here.

"How long is it going to take the economy to make that adjustment?" Selden continued. "How many businesses are going to go out of business?"