Posted by
John Finnigan on Thursday, May 17, 2007 12:28:04 PM
If we could magically send the 12 million illegal immigrants in the U.S. back to their countries of origin it’s very likely that inflation would spiral out of control. The influx of low wage seeking undocumented immigrants is one factor that has kept inflation under control. It’s not the only one, but it is a contributing element. The pool of available labor for farm laborers, construction workers, meat processors, domestic workers, hotel and restaurant laborers, day labor and landscapers would all change radically. There are many other categories that are affected as well.
As citizens and documented labor and replaced the undocumented, wages would most likely rise. In some cases it would rise a lot. Labor cost increases of 10 to 50% would not be out of consideration.
Now I’m not saying we should not reform immigration, but I do think we should prepare for the consequences.
John