"They're Taking Our Medals!"

08/17/2012 12:07 pm ET | Updated Oct 17, 2012
  • David Bier Director of Immigration Policy, Niskanen Center

"They're taking our medals!" That was the one reaction you did not hear after Mexican immigrant Leo Manzano won a silver medal for the U.S. last week. Manzano, whose parents brought him to the U.S. without documents at age four, helped the U.S. medal in the 1,500 meters for the first time since 1968. His success demonstrates immigration's benefits and helps undermine the often-repeated "they're-taking-our-jobs" argument against immigration.

America's economy, like its Olympic team, benefits when it can recruit talent from around the world. If U.S. companies cannot compete internationally, the Manzanos of the business world will find countries that do welcome them. Canada and Australia, for example, changed their immigration rules to allow more foreign workers to come. Some Canadian provinces provide automatic permanent residency to U.S. temporary high-skilled immigrants.

These foreign workers complement rather than displace natives. U.S. immigrants are concentrated at extremes, with elite athletes and the highly-educated at one end and the low-skilled and poorly-educated at the other. Most Americans fall somewhere in the middle. While 80% of Americans had either completed high school or college in 2009, immigrants accounted for almost half of all U.S. workers without a high school diploma. At the same time, immigrants held 27% of doctoral degrees.

The upshot is that immigrants mainly do not compete with American workers -- they create more opportunities for them. Low-skilled immigrants and highly-skilled engineers can work together in the construction of a new building, which also relies on thousands of other jobs needed to supply the materials, support, and technical assistance. Moreover, new infrastructure makes U.S. businesses more productive, thus creating jobs and increasing wages.

Immigration can benefit the skills of American workers in the long term in other ways. Early 20th century low-skilled immigration increased demand for medium-skilled workers, pushing Americans upward. Historian Aristide Zolberg notes that manufacturing's "skilled upper component consisted largely of natives or 'old' immigrants, whereas the lower semiskilled and unskilled one was filled by newcomers," and that, "recent research has confirmed contemporaneous reports of an overall increase of real wages in manufacturing in the pre-World War I decades."

Moderate or high-skilled immigration can have similar wage effects by increasing specialization, which is the root of all economic progress. As economist Donald Boudreaux noted recently in The New York Daily News, "[W]ith a larger labor force, workers become more specialized. The types of jobs change. We have today, for example, not only pediatricians, but pediatric cardiologists and pediatric gastroenterologists." Such specialization allows each worker's productivity to increase, raising their wages.

Unlike Olympic medals, there is not a limited number of jobs in the economy. Instead, innovation creates new jobs, even as it destroys old ones. As Fed Chairman Ben Bernanke has described, wages in industries that saw declines in employment in the 1990s were 6 percent less than wages in expanding industries. In other words, as manufacturing jobs were lost, even better sector jobs were gained.

Static economies, which retain the same jobs, fail to progress, innovate, and grow. Immigrants do not "take jobs;" they create new ones. Immigrants founded 28 percent of all new firms last year, making them twice as likely as natives to start a business. Over half of all Silicon Valley companies involved an immigrant founder. Similarly, in New York City, half of small businesses had an immigrant founder.

Driving away job creators and innovators does not make any more sense than driving away potential Olympic medalists. If America's immigration laws force Manzano and those like him out of the country, we will lose more than just another medal -- we will lose the economic growth and innovation immigrants bring. America must open itself up to compete for the most important aspect of capital -- human capital.