The law of unintended consequences: Georgia’s immigration law backfires

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harvesting organic vegetables (Credit: Getty Images North America via @daylife)

By Benjamin Powell

To avoid repeating last year, when labor shortages caused an estimated $140 million in agricultural losses as crops rotted in the fields, Georgia officials are now sending prisoners to state farms to help pick fruit and vegetables to help.

The labor shortage, which is also affecting the hotel and restaurant industry, is a consequence of Georgia’s immigration law HB 87, passed last year. As State MP Matt Ramsey, one of the drafters of the bill, said at the time, “Our goal is … to remove incentives for illegal aliens to enter our state.”

Now he and others are learning: Be careful what you ask for, because you may get more than you bargained for.

Georgia law, similar to that in Alabama, Arizona and some other states, gives police the power to request immigration documents from suspects when arresting them for other possible violations. The law also makes it harder for companies to hire workers and provides tougher penalties for those who employ or harbor illegal immigrants.

The Pew Hispanic Center estimated that about 425,000 illegal immigrants were living in Georgia when the law was passed — the seventh-highest number in the country. Those numbers are now down as hoped, but the state’s economy is paying a heavy price.

The dirty secret everyone knew was that most of the state’s farm workers were immigrants, many of them illegal. Some lived in the state; others migrated to New York and back with the harvest from South Florida. Some of the former have moved away, while many of the latter are bypassing Georgia. Without them, farmers would lack about 40 percent of the labor force needed to harvest last year’s crop, according to a University of Georgia study.

Despite the high unemployment rate in the state, most Georgians don’t want such backbreaking jobs and don’t have the necessary skills either. According to Dick Minor, president of the Georgia Fruit and Vegetable Growers’ Association, immigrants are “fairly professional harvesters,” many of whom specialize in specific crops.

Workers are paid by volume, with skilled workers typically earning $15 to $20 an hour. Unskilled workers earn far less, which is why most locals don’t want the jobs.

Georgia’s experience is consistent with economic research on immigration. Although many Americans believe that immigrants are “stealing” our jobs and driving down our wages, economists find little evidence to support this.

Since 1950, the US labor force has roughly doubled, but there has been no long-term rise in unemployment. Most economic studies also find little evidence that rising immigration is depressing US workers’ wages. At worst, it could depress early school leavers’ wages, but even there, the impact is small.

A simple supply and demand analysis seems to indicate that as you increase the labor supply, wages will fall. But immigrants don’t just increase the labor supply. They deliver skills most Americans don’t have. As such, they don’t so much replace American workers as give them the opportunity to do other, typically better-skilled, things. This symbiotic relationship benefits immigrants and locals alike.

Georgia’s immigration law has had exactly the effect that economic studies could have predicted. Farmers have a hard time finding workers with the right skills to harvest their crops. As a result, Minor says, “A lot of the smaller growers have chosen not to grow as many crops, or not to grow crops at all.” Those cuts cascade through the state economy, and everyone loses.

Of course, Georgia’s immigration law was not only motivated by economic concerns. Many Georgians were also concerned about the high cost of providing illegal residents with public services: schooling, medical care, law enforcement and other publicly funded services.

But there are better ways to solve such problems than driving away needed workers.

Georgia’s immigration law is a blunt instrument, causing unnecessary harm to immigrants and native Georgians alike, and making everyone poorer. Both Georgia and any other states considering similar legislation should reconsider.

Benjamin Powell is Associate Professor of Economics at Suffolk University in Boston and Senior Fellow at the Independent Institute, Oakland, CA.

Guest commentary curated by Forbes Opinion. Avik Roy, opinion editor.Continue readingread less