Claims that Immigrants 'Take Jobs' from Others Don't Hold Water in NYC
New York Times columnist Paul Krugman recently fact-checked the Trump-Vance campaign’s assertions that immigrants are taking jobs away from Black workers in particular and U.S.-born workers in general. Krugman pointed to the historically low Black unemployment rate and on-trend U.S.-born labor force participation as evidence that there is no basis for their assertions.
New York City has also become a target of the Trump-Vance campaign and their allies. They allege that the city is overrun by immigrants (and single cat ladies), and falsely claim that the city is experiencing a crime wave. Within this context, the busing of new migrants to the city by Governors Greg Abbott of Texas and Ron DeSantis of Florida since the spring of 2022 can be understood, not only as a political stunt, but as a pressure test on the city and its economy.
Given this, and long-standing evidence to the contrary, we conducted a local analysis of the labor market indicators Krugman examined to determine the impact of immigrants on New York City’s job market. There are three main takeaways:
1. Prime-age labor force participation of U.S.-born New Yorkers is at an all-time high.
Krugman argued that if immigrants were taking jobs away from U.S.-born workers, we’d see a decline in the U.S.-born labor force participation rate, since this group would be dropping out of the labor force due to their discouraging experience finding jobs. Times economics correspondent Ben Casselman added evidence to the argument, by pointing to the increasing U.S.-born, prime-age labor force participation rate.
In New York City, we see even stronger growth in U.S.-born, prime-age labor force participation (See Figure 1). In fact, U.S.-born, prime-age labor force participation is at an all-time high in the city and is converging with the national rate (which has historically been higher). Living in a city where an estimated 36.3 percent of the working age population is foreign-born and where over 200,000 new migrants have arrived since spring 2022 does not appear to have a negative impact on the desire of U.S.-born New Yorkers’ to work.
Figure 1
One caveat to this analysis: Since the beginning of the pandemic in March 2020, New York City has lost an estimated 375,000 working age residents due to out-migration. This may have shifted the composition of the population and contributed to the dramatic rise in the U.S.-born prime age labor force participation rate. We do not yet have enough data to estimate the potential impact of out-migration on this analysis. However, it is unlikely that it changes the direction of the trend line.
2. While Black and Hispanic workers, regardless of their citizenship status, experience the highest unemployment, non-citizens are the only group to see an increase in unemployment in the past two years.
Krugman points to the historically low Black unemployment rate as a sign that immigrants are not taking jobs from Black workers. This may be sufficient evidence for the national picture, but for many reasons more analysis is needed for New York City.
The city experienced a more severe shock and a slower recovery from the pandemic, which has had a disproportionate impact on historically disadvantaged groups in the labor market, particularly Black and Hispanic workers, young workers, and workers with less education. As a result, New York City’s Black unemployment rate has not been at historic lows in recent years.
It's important, then, to evaluate the unemployment rate of Black New Yorkers within the context of other race/ethnic and citizenship-status groups surveyed by the Bureau of Labor Statistics (BLS). There are some limitations to note. First, The BLS uses three citizenship categories: U.S.-born, naturalized citizen (people born abroad who have obtained U.S. citizenship), and non-citizen (everyone else born abroad, ranging from green card holders to undocumented people). Second, the non-citizen category may not best represent the experiences of this broad group, because undocumented people are likely underrepresented in the survey and new migrants are unlikely surveyed at all). Lastly, due to the sample size, we can only disaggregate data by race/ethnic or citizenship-status (not both).
Despite these limitations, we find that some race/ethnic groups and some citizenship-status groups experience either more privilege or more discrimination than others in the labor market. This is exhibited in how, nationally and in New York City, different race/ethnic and citizenship-status groups have a relatively fixed order when comparing their unemployment rates (though the gaps between their unemployment rates do change). (See Figure 2A Figure 2B). For example, white, Asian American and Pacific Islander (AAPI), and naturalized citizens of all race/ethnic groups always have the lowest unemployment rates. Meanwhile, Black workers historically have the highest unemployment rate, even when accounting for educational attainment level, a sign that they experience persistent discrimination in the labor market. Hispanic workers have the second highest unemployment rate. All of these trends were true before the pandemic and continue to be true today.
Figure 2A
Figure 2B
In between these two extremes of labor market privilege and discrimination, we find U.S.-born workers. Nationally, U.S.-born workers have a lower unemployment rate than non-citizens. In New York City, however, U.S.-born and non-citizen unemployment rates are similar. This perhaps reflects the large U.S.-born Black and Hispanic working age population that faces heightened friction in the labor market.
There are reasons to be cautious in making definitive conclusions about changes in these rates over time (even in applying a moving average as Krugman did to account for seasonality). However, Figure 3 shows that from the second quarter of 2022 to the first quarter of 2024, both nationally and locally, the non-citizen unemployment rate is the only rate to have gone up (though non-citizen labor force participation has also increased during this period). This time period is important for two reasons. First, spring 2022 is when migrants started arriving on buses in New York City. Second, during this period, the Federal Reserve raised interest rates and maintained those increases, intending to fight inflation. Many economists predicted this monetary policy would result in a recession and higher unemployment. It has not. Instead, the unemployment rate for most groups continued to decline during this period (even if at a slower rate, especially nationally where the Covid economic recovery had largely been completed).
Figure 3
If new migrants, coming from across the globe, are having any impact on labor market friction, it’s only within the group that most closely resembles them. There is no evidence here that the migrants who have arrived in New York City since 2022 have impacted access to employment for Black, white, or U.S.-born New Yorkers looking for work. On the other hand, Figure 2A and Figure 2B does illustrate similar movements in the unemployment rates of non-citizens and Hispanics, which reflect the high proportion of non-citizens who identify as Hispanic. The latest estimates from the Center for Migration Studies show that 56.4 percent of undocumented people in New York State identify as Hispanic.
3. There are other factors that contribute to New York City’s labor market inequality today.
While this analysis demonstrates that immigrants aren’t taking jobs away from U.S.-born New Yorkers, it’s not all good news. This analysis highlights that persistent labor market inequality is a feature of the American and New York City economy. It also shows the vulnerability of non-citizens in the labor market today, whether they arrived in New York City this year or a decade ago. There are a few factors worth highlighting here.
First, people of different demographic groups tend to sort or segregate into specific occupations and industries for a variety of reasons. This is not technically a problem if there are enough available high-quality jobs in each industry and occupation. However, these prerequisites do not exist in the United States. In fact, New York City’s post-Covid economic experience is an example of the disproportionate impact of industrial segregation on workers of color in particular. The city’s economy was transformed by Covid, with jobs in certain industries – like retail and construction – declining and jobs in other sectors – like home healthcare – increasing. High unemployment rates among Black and Hispanic workers signal that these groups have faced the greatest barriers pivoting to industries in which they have been historically underrepresented. As the economy continues to evolve, policymakers should prioritize developing active labor market policies that can support and retrain workers most likely to face these challenges.
Additionally, occupational and industrial segregation in our existing labor market, where not all jobs are high quality, points to the urgent need for better labor market standards and protections. This is particularly important in New York City, given the recent and projected growth in low-wage jobs and the impact it has on income inequality for women of color in particular. Increasing job quality impacts people’s sentiment about their jobs and economic prospects. Given the legal challenges non-citizens face in the labor market and the positive, long-term impact they have on the economy, policymakers should also toughen enforcement against wage theft in key industries where undocumented New Yorkers work. They must also improve protections for gig workers often misclassified as independent contractors.
Also contributing to labor market inequality is the dynamics and structure of economic growth. History demonstrates that sustained, strong economic demand can help to shrink unemployment rate gaps between different demographic groups. How many jobs are added to the economy and in what industries is the result of public and private investment and consumer spending. These sources of demand, combined with targeted economic development and active labor market policies, can produce jobs providing family-sustaining wages where and for whom they currently do not exist.
There isn’t enough space here to evaluate all of the policies that may be most effective at generating meaningful, demand-led growth for the U.S. and New York City today. However, increasing the likelihood that all workers have access to high-quality jobs requires policies that build off the skills and resources people bring to the economy and facilitates investment looking towards the future.