Wednesday, May 19, 2004

KRT Wire | 05/19/2004 | Experts say increase in temporary worker visas impacts economy

KRT Wire | 05/19/2004 | Experts say increase in temporary worker visas impacts economy
Posted on Wed, May. 19, 2004

Experts say increase in temporary worker visas impacts economy


St. Louis Post-Dispatch

WASHINGTON - The Belmontes brothers - (KRT) - Jose, Andres and Alejandro - boarded a bus in Villanueva, Mexico, in late February, en route to $7.25-an-hour jobs with Loyet Landscape Maintenance in St. Charles, Ill.

They had one stop first: The U.S. Consulate in Monterrey, Mexico. There, consular officials issued them three of the 150 temporary worker visas that the U.S. Labor Department had approved this year for Loyet to fill with foreign labor. In doing so, the agency had to certify that the company - which advertised the jobs first in local newspapers - couldn't get locals to do the jobs.

The number of temporary workers Loyet has used has grown steadily over the years, and the company is not alone in making more use of the visas, known as the H 2B. The Labor Department approved more than 4,000 visa applications from Missouri businesses last year, and more than 2,000 from Illinois - many times the numbers just a few years ago. (Not all of the applications result in visas that are used.)

Nationwide, the certifications nearly quintupled in the past five years. This year, the program that was halted in March when it reached its annual 66,000-worker limit, provoking an outcry among owners of summer-tourism businesses that rely heavily on foreign workers.

Most of the visas in Missouri and Illinois are used to hire landscape workers. Yet thousands of others also brought in forest workers, janitorial and housekeeping crews, and construction and restaurant workers - many of the same types of jobs that illegal foreign workers are doing.

President George W. Bush and others have floated plans to allow more such workers to be in the United States legally, prompting a wide-ranging debate about the impact foreign workers are having on the job market, and on consumers.

Critics say employers are taking advantage of both legal and illegal foreign labor because they don't want to pay enough to attractive native workers.

"Our own home-grown labor is in such terrible straits right now that it's callous to bring foreign workers into their job market. This directly attacks the poorest of the working poor," said Roy Beck of Numbers USA, a Washington-based group that advocates stringent immigration controls.

Employers who use low-skilled, low-wage workers counter that labor shortages demand expanded access to foreign labor. Without that, they say, their businesses would suffer significantly - or go under.

"You can't just create human beings by paying more," said John Gay, co-chairman of the Essential Worker Immigration Coalition, a group that spans several industries, from landscaping to plumbing, hotels and restaurants and advocates expanded access to foreign workers - including the legalization of illegal workers already in the United States. "Demographically we are not producing enough people in this country to sustain the economic growth that we as a society want to have."

Russell Roberts, an economics professor at George Mason University in Fairfax, Va., said each argument has merit.

"I think they're both right," he said. "There's a little hyperbole on both sides. Obviously (employers) could offer more and get more domestic native workers, but the question is how much more? And if they did, they'd probably have to raise their prices and wouldn't get as much business ...

"And there's another, hidden effect: Companies would have less money to spend on something else, because they would have to spend more for landscaping. So there'd be less of something else. What would that be? I don't know. ... There'd be less work in other industries outside of landscaping because of these changes."

Few would dispute that the growth in the visa program has been a boon in small, poor Mexican towns like the Belmontes' hometown of El Salto. For as long as anyone can remember, men from the town have crossed illegally to work in the United States - and are still doing so.

But with stepped-up border security, crossing illegally has become riskier. Under the temporary-worker program, men like the Belmontes brothers can return to their families just before Christmas and get a visa with the same company the next year to go back legally.

Andres Belmontes, 44, first came to St. Louis on a visa with Top Care Lawn Service, Missouri's top employer of H-2B workers. The Labor Department has regularly approved the company for 200 visas a year. For Belmontes, the one that came to him after a recommendation from a friend in St. Louis, it was a way to provide for his growing family. That was something he could barely do back home as a police officer, a notoriously poorly paid job in Mexico.

"It just wasn't enough to keep the family going. I wanted to improve my life," said Andres Belmontes, who lives nine months away from his wife and three kids to work in St. Louis, sleeping on the floor of his sister's trailer in Fairmont City, Mo. As a single man two decades ago, he crossed illegally to work in a factory in California, and he finds this alternative far better: "It's easier with the visa."

The numbers of foreign-worker visas in such low-skilled work has surged in recent years, particularly since 2000. At the tail end of a decade of rapid economic growth, the native labor market couldn't keep up with the demand. But even as a recession hit in 2001, the numbers continued to grow.

Many attribute the rush for visas to increased immigration sweeps in the 1990s. Immigration agents arrested and deported 22 Mexican nationals who had been working with false visas for Top Care in 1992. And in 1997, they deported more than 50 illegal Mexican workers employed in St. Louis by the Brickman Group, a national landscaping company based in Pennsylvania. The company did not return calls for comment for this story.

"I truly think that when Brickman was raided, that was a wake-up call to all of the employers," said Susan Cho Figenshau, a St. Louis immigration lawyer who has helped several clients, many of them landscapers, to secure visas for foreign workers.

Arthur Carr, another St. Louis immigration lawyer, cited a more subtle reminder from the federal government. Clients started coming to him looking for visa help after many began receiving letters from the Social Security Administration that said their employees' names didn't match with the Social Security numbers they were using. In some cases, it was because their workers were using false documents.

Social Security Administration spokeswoman Carolyn Cheezum said that was not the program's intent. But the effect was real for companies whose workers couldn't explain the mismatch, particularly in 2002, when 950,000 such letters landed in employers' mailboxes.

The employers who have most heavily used the visas in recent years say they can't run their businesses without them.

Loyet's general manager Mike King said few locals, if any, respond to the newspaper want ads that he must run before he can seek foreign workers under the program.

"Out of 125 openings, I had nobody apply for that work," King said, referring to landscaping jobs such as mowing lawns, putting down mulch or planting shrubs. "The year before, I had three who applied for 125 positions - and they didn't work out. Of those three, one showed up to be interviewed and was hired. He stayed three days. The other two elected not to take the position. The work was too hard. It's very physical work."

Top Care general manager Rusty White said he has similar experiences. He believes the temporary nature of the work is a significant reason: "Not a lot of people are interested in seasonal jobs. They'd rather have year-round income."

President Bush's guest-worker proposal, announced in January, would allow millions of undocumented workers here the chance to qualify for three-year renewable temporary visas to fill low-skilled jobs that U.S. workers won't take. Workers abroad could also apply.

His proposal also would allow the temporary workers to switch employers in certain circumstances - a luxury the H-2B program does not allow. Under Bush's plan, for example, the 21 Nicaraguan janitors who were laid off at Washington University in November after three months on the job would have been able to stay in the United States and look for a job elsewhere. (The university's dispute with the contractor who employed the janitors led to their quick return home to Nicaragua.)

The president's plan has received a cool reception from some Republicans who argue it will reward those who came into the country illegally. Other Republicans and many Democrats also oppose the plan - because it doesn't give illegal workers a path to permanent residency in the United States.

Republicans and Democrats have offered several other proposals that would expand foreign-worker programs. Most do provide a path to legal permanent residence that can eventually lead to U.S. citizenship.

The one most likely to become law is a proposal that would provide for the legalization of 500,000-850,000 agricultural workers and the possibility for eventual citizenship. The measure has broad, bi-partisan support, but wouldn't affect millions of other illegal workers here.

Andrew Sum is an economics professor and the director of the Northeastern University Center for Labor Market Studies in Boston who thinks now is a bad time to allow more foreign workers into the country.

He believes that foreign workers were needed during the boom times of the 1990s, but that when they continued to be hired in the recession that followed in 2001, it put low-skilled native workers out of work.

"Immigrants have made major contributions to the labor markets, but we never varied our immigration policy when the economy hit its downturn. We kept allowing large amounts of immigrants to come in," said Sum. He estimates that more than 2.1 million new immigrants - legal and illegal - have joined the U.S. work force since January 2001, displacing roughly 1.5 million native-born workers.

"Basically the types of jobs they're taking is of native-born workers with very similar education," he said. "They face this enormous competition from less-skilled immigrants."

Morton Paglin, an emeritus professor of economics at Portland (Ore.) State University who has studied the underground economy, said many businesses that depend on temporary labor could suffer if they are forced to increase wages to make jobs more appealing to American workers.

"It's true if you paid enough you could evoke more of a supply of labor in the United States. But then the viability of the business is in question - or if the cost is pushed up, then demand goes down," Paglin said.

"For example, in the leisure tourist industry, the demand for hotel space is fairly elastic given an increase in price will increase the demand. People could go some place where it's cheaper. They could pitch a tent in a national park. If you pay the price you can get (native labor) up to a point, but what are the consequences?"

All of the economists interviewed for this article agreed that a decrease in dependence on foreign labor and the increased labor costs to lure native workers to the jobs would inevitably lead to higher prices for consumers. In Missouri and Illinois, that would likely mean higher prices for landscaping, hotels and restaurants and for produce in the grocery store.

Sum, the Northeastern University economics professor, said he's willing to pay more, but acknowledges most likely would not. "I think I am not in the majority. A lot of people want to get things as cheap as they can. When you're trying to do it by trying to pound wages down to the lowest common denominator, I consider it bad social policy."

Roberts, the George Mason University economics professor, sees the issue differently. He uses the example of the public disdain for Wal-Mart, which grew to be the world's largest corporation by cost-cutting strategies that depend heavily on paying low wages and buying many of its products from the poorest countries.

"A lot of people complain that Wal-Mart creates all this social change - and they say, `For what? Just for the low prices?' But for some people, low prices are really important," Roberts said. "I don't feel comfortable telling someone they can't save money. What right do I have to tell them that? This argument that says, `The companies can afford to pay more,' what they're really saying is, `Customers can afford to pay more.' But sometimes, they can't."

Gary Clifton, president of Ambassador Hospitality Inc. and Proline Management of St. Charles, has been using temporary-worker visas to employ landscapers and hotel housekeepers since 2002. The companies contract out the workers to landscaping firms and resorts that have trouble filling their seasonal jobs. He paid the 138 housekeepers and the 148 landscapers he employed last year between $6.74 and $7.89 an hour, according to Labor Department records.

He brought in 500 more temporary workers this year, he said. Clifton said he likes the sound of Bush's plan and others that would allow him to hire illegal workers already living here. While he must provide housing and transportation for the workers he brings from abroad, those foreign workers already living here would eliminate such costs.

"I think you would see a great reduction in the number of workers brought in because the ones here would be coming out from the shadows and would be free to move about," Clifton said.

"The down side to that is, if they're able to hop from one employer to the next. If someone down the street offers them 25 cents more an hour, you'd be out of luck. But then again, that's the American way."


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