Immigration doesn't keep wages down
14/10/22
The Nobel Prize for Economics was won last year by David Card for his 1980 study on immigration and wages. Back then, about 125,000 Cubans arrived in Miami within a few months, all eligible to work immediately in the United States. The greater Miami workforce jumped by 7% in weeks and the number of low-skilled workers increased a whopping 20%. What do you think happened to wages?
Professor Card showed that the sudden supply of new workers had no negative effect on wages for the low-skilled natives of Florida.
But surely simple supply and demand should dictate that more low-skilled workers lowers wages? Card reassured policy-makers that simple logic was wrong.
The reasons have been debated ever since, but the results are widely accepted: Local low-skilled workers transitioned into jobs that required good English, while new migrants took jobs that didn't need language skills.
Josie argues that immigration doesn't suppress wages, in her weekly Stuff column.
Professor Card showed that the sudden supply of new workers had no negative effect on wages for the low-skilled natives of Florida.
But surely simple supply and demand should dictate that more low-skilled workers lowers wages? Card reassured policy-makers that simple logic was wrong.
The reasons have been debated ever since, but the results are widely accepted: Local low-skilled workers transitioned into jobs that required good English, while new migrants took jobs that didn't need language skills.
Josie argues that immigration doesn't suppress wages, in her weekly Stuff column.
