Facts on Mexican Immigration

Assessing the impact on the United States

At their summit in February of this year, the new Presidents of Mexico and the United States promised to work together to create an “orderly framework for migration” between their countries. As a result of the summit, a new high-level working group has been established to study migration between the United States and Mexico. A number of members of Congress have also proposed changes in the laws governing immigration from Mexico, including a new guestworker program for Mexicans, an increase in legal immigration from Mexico, and an amnesty for illegal aliens. Whatever the outcome of these initiatives, policymakers in the United States clearly need up-to-date information in order to weigh the costs and benefits of such programs. Using the latest data available, this report examines the characteristics of the Mexican-born population in the United States in order to shed light on the effect Mexican immigration has on this country and to provide insight into the likely impact of future immigration from Mexico.

The report comes to some very troubling conclusions. By increasing the supply of unskilled labor, Mexican immigration has reduced the wages of workers who lack a high school education. This reduction in wages for the unskilled (who are already among the poorest workers in the United States) may reduce prices in the United States by no more than one or two tenths of one percent. The effect is so small because unskilled workers account for only a tiny share of economic output. Thus, even a substantial reduction in their wages cannot generate large benefits for consumers. Moreover, because such a large share of Mexicans are unskilled at a time when the U.S. economy offers limited opportunities to unskilled workers, Mexican immigration has added significantly to the size of the poor and uninsured populations, and to the nation’s welfare case load.