zlacker

>>tysone+(OP)
Wage growth would help, but for some reason, these articles never even mention immigration. The scale of immigration both legal and illegal I believe has the greatest impact on the lowest sectors of society. The lack of discussion on the impact so many potential new workers is having on wage growth leads one to think they believe labor cost is the one thing immune to the law of supply and demand.

>>tosser+aH
It’s interesting the immigration cannot even be mentioned without getting down voted.

It seems obvious to me that fewer low skill workers would result in higher wages for those who could most benefit from it.

>>tosser+6I
This does not seem obvious to me. For example, imagine if you overnight doubled the US population. Would wages go down? Well, overnight you would also double the economy and double demand for just about every kind of work, from hairdressers to security guards. What's the overall effect? (And you are talking about just 3.5%, not 100%.)

Here's one classic study on the effect:

David Card, "The Impact of the Mariel Boatlift on the Miami Labor Market" (1990), http://davidcard.berkeley.edu/papers/mariel-impact.pdf

Quoting from the abstract: "…This paper describes the effect of the Mariel Boatlift of 1980 on the Miami labor market. The Mariel immigrants increased the Miami labor force by 7%, and the percentage increase in labor supply to less-skilled occupations and industries was even greater because most of the immigrants were relatively unskilled. Nevertheless, the Mariel influx appears to have had virtually no effect on the wages or unemployment rates of less-skilled workers…"

That's a rapid influx of 7% of Miami's population! But the effect isn't obvious to economists, either, and you can find people arguing both sides. This is a fairly balanced article: https://www.npr.org/2017/08/04/541321716/fact-check-have-low...

>>greene+1L
We can actually hold for immigration to some degree. For example, while not exactly doubling, the entry of women into the workforce after WWII had a similar effect of massively increasing the the supply of labour.

You would think that two income earners in a household would increase the economy enough that wages would need to rise due to a subsequent shortage of labor... but it did not.

Wages, in real terms, have largely lost purchasing power to the point where it takes two incomes to have the same (or less) purchasing power than one income did prior to WWII.

Part of it is the productivity gains made post WWII (i.e. we can do more with less labor) but a lot of it is the supply side of labor and competitive pressures pushing the price equilibrium (wages) down.

I'm not making an argument against the entry of women into the workforce. I'm an advocate for 'freedom' so I'm all for women doing what they want as long as they are following the law. My point here is the supply side of labor does not have a large enough increase to the demand side of labor to make up for the decrease in the price of wages.