Establishment economists couldn’t contain themselves:
“This was everything you could have asked for, maybe more,” said Michelle Meyer, head of United States economics at Bank of America Merrill Lynch. “We’re seeing new entrants into the labor market, which implies a longer runway for the business cycle.”Well, yes Ms. Meyer, new entrants are surging into the U.S. labor market. But as you can see in the table at the bottom of this article, most the this “surge” is from overseas. (The foreign-born immigrant labor force grew 5-times faster than the native-born American labor force over the past 12 months).
“This is a validator,” said Michael Gapen, chief United States economist at Barclays. “This is a report that indicates that the slowdown in hiring earlier in the year has been reversed.”
By Nelson D. Schwartz, NYT, August 5, 2016
And yes, Mr. Gapen [Email him] the slowdown in hiring evident earlier this year does seem to have reversed—but immigrants, not native-born Americans, are the overwhelming benefactors. (Over the past two months immigrants have gained 647,000 jobs—a 2.6% gain—while American workers have lost have lost 160,000, a 0.1% loss.
While July saw a robust 420,000 gain in Household Survey employment, the foreign-born component surged more than twice as fast as the native-born.
Native-born American employment growth is represented by the black line, immigrant employment growth is in pink, and NVAWDI—the ratio of immigrant to native-born job growth—is in yellow. The index starts at 100.0 in January 2009 for both immigrants and native-born Americans, and tracks their employment growth since then.
From January 2009 through July 2016:
The foreign-born share of total U.S. employment has risen steadily, although erratically, throughout the Obama years:
In February 2009, President Obama’s first full month in office, 14.972% of all persons working in the U.S. were foreign-born. The foreign-born share reported in July was 17.046%, ranking second among the 91 months of Mr. Obama’s administration. The record, 17.077%, was reached in March of this year. Six of the 10 worst months of American worker displacement during the Obama years—i.e., months with the highest foreign-born employment shares— have occurred during the first seven months of 2016.
So July’s immigrant employment share was 2.07 percentage points above the level recorded in February 2009, Barack Obama’s first full month in office. With total employment now at 151.5 million, this implies that Obama-era immigration may have pushed as many as 3.14 million native-born Americans onto the unemployment rolls since then.
A detailed snapshot of American worker displacement over the past year is seen in the Employment Status of the Civilian Population by nativity table published in the monthly BLS Report. PDF
|Employment Status by Nativity, July 2015-July 2016|
|(numbers in 1000s; not seasonally adjusted)|
|Foreign born, 16 years and older|
|Civilian labor force||26,079||27,132||1,053||4.0%|
|Participation rate (%)||65.0||65.7||0.7 %pts.||1.1%|
|Employment/population %||61.6||62.9||1.3 %pts.||2.1%|
|Unemployment rate (%)||5.2||4.2||1.0 %pts.||-19.2%|
|Not in labor force||14,056||14,178||122||0.9%|
|Native born, 16 years and older|
|Civilian labor force||132,448||133,572||1,124||0.8%|
|Participation rate (%)||62.8||62.9||0.1 %pts.||0.2%|
|Employment/population %||59.3||59.6||0.3 %pts.||0.5%|
|Unemployment rate (%)||5.6||5.3||0.3 %pts.||-5.4%|
|Not in labor force||78,293||78,737||444||0.6%|
|Source: BLS, The Employment Situation—July 2016, Table A-7, August 5, 2016.|
From July 2015 to July 2016:
Once again the civilian population numbers give us pause. BLS estimates that the population of working age immigrants grew by 1.2 million over the 12 months from July 2015 to July 2016. That is larger than the commonly cited figure of 1 million per year for net legal immigration of all ages.
As Donald Trump might say: What’s going on here?