Does Kicking Out Mexicans Create Jobs?
Here’s what happened the last time an American president promised to create jobs by removing Mexican immigrants.
By Michael A. Clemens
February 15, 2017
The president pledges to remove more than a third of the Mexicans who work in the United States. He says this will improve “the wage and employment conditions of domestic workers.” That’s obvious, researchers tell Congress, since not even lawmakers can “repeal the law of supply and demand.” If the supply of workers goes down, wages must go up, right? The administration and Congress act together, and within a few years, those Mexicans are gone.
This is not 2017. It was 1962. The administration and both houses of Congress were controlled by Democrats. It was the last large-scale, targeted removal of Mexicans living in the U.S. And what happened next was nothing like what President John F. Kennedy promised.
For more than two decades leading up to 1964, the U.S. and Mexico created a lawful channel for Mexican braceros (manual laborers) to work temporarily in the U.S., mostly on farms. There were half a million at the program’s height. In 1964, President Lyndon Johnson accomplished what Kennedy had pushed for: ending the program and expelling the braceros from the country.
They did it to help U.S. workers. Did they succeed? Until recently, nobody knew.
I just completed a two-year study of the removal of these braceros together with Ethan Lewis of Dartmouth College and Hannah Postel, my colleague at the Center for Global Development. Prior to our work, no one had ever systematically tested whether the exclusion of braceros achieved its economic goal. Historians had focused almost entirely on the politics. Kennedy’s beliefs about the economic effects of the braceros relied on the findings of a Department of Labor commission that hadn’t actually analyzed economic data and was, in fact, led by Rufus von KleinSmid, charter member of a society of eugenicists that had advocated blocking Mexican immigration, believing that Mexicans constituted a genetically inferior race.
We had to start by gathering detailed data on farm wages and employment from that period. The reason our study took us two years is that no one had ever assembled data on how many braceros were working in each state; we had to dig into boxes of yellowing paper archives all over America to uncover the data that would enable us to measure what really happened to U.S. workers’ wages and employment when the braceros were suddenly gone.
What we discovered was a surprise: Excluding the Mexican braceros did not affect the wages or employment of U.S. farmworkers.
To illustrate, here’s a small sample of our data. Below are the average U.S. farm wages in the states most heavily exposed to bracero exclusion, compared to wages in states barely affected, or entirely unaffected by exclusion at the end of 1964:
Bracero exclusion meant that in some states, farms lost more than a third of their hired seasonal workforce. If bracero exclusion had raised wages for American farmworkers, you would see wages rising faster in the heavily affected states after exclusion. There just isn’t a hint of that. If anything, wages grew more in the states untouched by the removal of Mexican workers. That’s remarkable, since when an economic good like labor becomes more scarce, you might expect its price to rise.
Does this mean, as one researcher sarcastically told Congress in a 1961 hearing about braceros, that the law of supply and demand had been repealed? Not quite. In immigration debates, it is common to assert that “basic economics” holds that when workers are scarce, firms must raise wages. But the economic truth is that in a free market, firms have various ways to respond to fluctuations in supply or demand.
American firms—in this case, farms—are remarkably adaptable and innovative. When workers they depend on aren’t available, businesses can adapt. They can reduce production, shift to less labor-intensive products, create new production technology, adopt existing mechanization technology, adjust product quality for a different consumer segment, shift production overseas, merge or even exit the sector. They can also jack up wages, but whether that’s the best choice depends on myriad factors, including the supply of U.S. workers at any given wage. In hand-harvest agriculture, that supply was low in 1965 and has gotten even lower since.
We show that U.S. farms primarily responded to the absence of braceros in some of these alternative ways, not by raising wages. In crops with readily available mechanization technologies for harvesting and field preparation, those technologies were quickly adopted. The starkest example is California tomato picking, where the excluded braceros were mostly replaced by mass-adoption of mechanized harvesters within just one year. In crops where technologies didn’t exist for quick mechanization—like asparagus and fresh strawberries—exclusion of bracero caused sharp declines in production. That reflects some combination of U.S. agriculture changing its crop mix, moving production abroad and farmers being forced out of business.
You might think that unauthorized Mexican workers simply substituted for the braceros. That did happen to some degree, but only about 10 years later. The braceros of 1964 didn’t stay illegally into 1965, since almost all of them were registered upon return to Mexico. Nor was there a wave of unauthorized arrivals in 1965: Border apprehensions barely budged for several years, even though enforcement efforts steadily expanded throughout the 1960s. The braceros were not replaced by unauthorized Mexican workers or by U.S. farmworkers; they were replaced by machines and innovation.
Politicians who claim to know the effects of excluding foreign workers, and lecture the public about “basic supply and demand,” simply fail to account for the complexity of the U.S. economy and the agile adaptability of U.S. firms. Kennedy’s statements were just as confident, but we know now that he was simply wrong. When you are preached to about the “obvious” effects of future worker exclusions, be skeptical—and look for guidance in hard facts from the lived experience of American history.
Michael A. Clemens is an economist at the Center for Global Development and the IZA Institute of Labor Economics, whose research has won the Royal Economic Society prize. He is the author of The Walls of Nations, forthcoming from Columbia University Press.