[Senate Hearing 109-775]
[From the U.S. Government Publishing Office]
S. Hrg. 109-775
EMPLOYMENT-BASED PERMANENT IMMIGRATION: EXAMINING THE VALUE OF A
SKILLS-BASED POINT SYSTEM
=======================================================================
HEARING
OF THE
COMMITTEE ON HEALTH, EDUCATION,
LABOR, AND PENSIONS
UNITED STATES SENATE
ONE HUNDRED NINTH CONGRESS
SECOND SESSION
ON
EXAMINING THE VALUE OF A SKILLS-BASED POINT SYSTEM RELATING TO
EMPLOYMENT-BASED PERMANENT IMMIGRATION
__________
SEPTEMBER 14, 2006
__________
Printed for the use of the Committee on Health, Education, Labor, and
Pensions
Available via the World Wide Web: http://www.gpoaccess.gov/congress
// senate
U.S. GOVERNMENT PRINTING OFFICE
30-005 PDF WASHINGTON : 2007
------------------------------------------------------------------
For sale by Superintendent of Documents, U.S. Government Printing
Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800;
DC area (202) 512-1800 Fax: (202) 512-2250. Mail: Stop SSOP,
Washington, DC 20402-0001
COMMITTEE ON HEALTH, EDUCATION, LABOR, AND PENSIONS
MICHAEL B. ENZI, Wyoming, Chairman
JUDD GREGG, New Hampshire EDWARD M. KENNEDY, Massachusetts
BILL FRIST, Tennessee CHRISTOPHER J. DODD, Connecticut
LAMAR ALEXANDER, Tennessee TOM HARKIN, Iowa
RICHARD BURR, North Carolina BARBARA A. MIKULSKI, Maryland
JOHNNY ISAKSON, Georgia JAMES M. JEFFORDS (I), Vermont
MIKE DeWINE, Ohio JEFF BINGAMAN, New Mexico
JOHN ENSIGN, Nevada PATTY MURRAY, Washington
ORRIN G. HATCH, Utah JACK REED, Rhode Island
JEFF SESSIONS, Alabama HILLARY RODHAM CLINTON, New York
PAT ROBERTS, Kansas
Katherine Brunett McGuire, Staff Director
J. Michael Myers, Minority Staff Director and Chief Counsel
(ii)
C O N T E N T S
__________
STATEMENTS
THURSDAY, SEPTEMBER 14, 2006
Page
Enzi, Hon. Michael B., Chairman, Committee on Health, Education,
Labor, and Pensions, opening statement......................... 1
Sessions, Hon. Jeff, a U.S. Senator from the State of Alabama,
opening statement.............................................. 3
Beach, Charles M., Professor of Economics, Queen's University.... 4
Prepared statement........................................... 5
Borjas, George J., Professor of Economics and Social Policy,
Kennedy School of Government, Harvard University............... 12
Prepared statement........................................... 15
Massey, Douglas S., Office of Population Research, Princeton
University..................................................... 18
Prepared statement........................................... 19
Tonelson, Alan, Research Fellow, U.W. Business and Industry
Council Educational Forum...................................... 21
Prepared statement........................................... 24
ADDITIONAL MATERIAL
Statements, articles, publications, letters, etc.:
Report for Congress, July 2006............................... 42
Katherine M. Donato, Douglas S. Massey, and Brandon Wagner... 58
Response to Questions of Senator Kennedy and Senator Sessions
by Charles M. Beach........................................ 72
Response to Questions of Senator Kennedy by Douglas S. Massey 74
Response to Questions of Senator Sessions by George J. Borjas 75
Letter from Monte Solberg to Senator Sessions................ 77
(iii)
EMPLOYMENT-BASED PERMANENT
IMMIGRATION: EXAMINING THE VALUE
OF A SKILLS-BASED POINT SYSTEM
----------
THURSDAY, SEPTEMBER 14, 2006
U.S. Senate,
Committee on Health, Education, Labor, and Pensions,
Washington, DC.
The committee met, pursuant to notice, at 10:34 a.m., in
Room SD-430, Dirksen Senate Office Building, Hon. Mike Enzi,
chairman of the committee, presiding.
Present: Senators Enzi and Sessions.
Opening Statement of Senator Enzi
The Chairman. Good morning and welcome to today's hearing
on employment-based, permanent immigration. U.S. immigration
policy is currently the focus of considerable public discussion
and debate. Our policies regarding immigration have broad-
reaching, practical implications, including ones that impact
the diverse jurisdictional areas of this committee. Immigration
policy affects our educational systems and training programs,
our health care delivery and insurance systems and our overall
labor market economics. As this public policy discussion and
component of that policy, which has received less notice than
some others, is the issue of permanent immigration. It is,
however, a component that deserves greater attention.
Last year, some 1.2 million immigrants were accorded legal
permanent resident status, and, over the last decade, permanent
immigration status has been accorded to a little less than 1
million immigrants annually. Among those groups that are
accorded permanent resident status are those whose admission is
employment-based. The relative number of individuals that
obtain permanent resident status through employment-based
immigration and the criteria by which their suitability for
permanent residency is determined are issues that have been
faced recently by other countries. In reviewing our own
immigration policies, it makes sense to review the experiences
of other countries that have dealt with many of the same issues
that face us today. Two countries, Canada and Australia, have
implemented reforms regarding employment-based permanent
immigration. Both countries utilize a skills-based point system
to determine matters relating to permanent residency. Today's
hearing will examine both of these systems in an effort to
determine their potential value in the context of U.S.
immigration policy.
We are fortunate to have with us this morning a
distinguished panel of experts to provide us with their
insights and views on these issues. Charles Beach is Professor
of Economics at Queens University in Ontario, Canada, where he
also serves as the Director of the Institute for the Study of
Economic Policy. He has researched and published extensively in
the fields of public policy, income distribution and labor
market analysis and is currently engaged in extensive research
in the area of Canadian immigration policy. He is the founder
of the Canadian Econometric Study Group and the Canadian
Econometric Research Forum as well as Program Director of the
Canadian Labor Market and Skills Researcher Network. Welcome.
George Borjas is the Scrivner Professor of Economics and
Social Policy at the Kennedy School of Government at Harvard
University as well as Research Associate at the National Bureau
of Economic Research. He is the author of a number of books and
has written over 100 scholarly articles on labor market issues
and immigration policy. His work appears regularly in major
magazines, newspapers and editorials. Both Business Week and
the Wall Street Journal have called him America's leading
immigration economist. Thank you for being here.
Mr. Douglas Massey is the Bryant Professor of Sociology and
Public Affairs at Princeton University. His research efforts
have focused on issues of international migration. He is the
author of numerous scholarly works, including most recently,
``Crossing the Border: Research from the American Migration
Project'' and ``International Migration: Prospects and Policies
in the Global Market.'' He served as President of both the
American Sociological Association and the Population
Association of America. Thank you for being here.
We also have with us Alan Tonelson, who is a Research
Fellow at the U.S. Business and Industry Educational
Foundation, a Washington, DC. research association studying the
issues of national security, technology and economic policy. He
is the author of a number of books and articles on economic,
domestic and foreign policy. He has previously served as a
Fellow on the Economic Strategy Institute and as Associate
Editor of Foreign Policy. Welcome to you and to all of you on
behalf of the committee, we thank you for your willingness to
participate in today's hearing.
We are also fortunate today to have with us Senator Jeff
Sessions of Alabama, who has been a leader in the Senate with
respect to immigration issues; and, who has encouraged the
review and study of other immigration systems. He suggested
that this kind of forum would be a good way to build a record
that we can utilize as we explore the issues of permanent
immigration. Unfortunately, permanent immigration is a
component of overall immigration policy that is too often
neglected.
I do have to say because of my schedule this morning, I'll
be unable to remain for the entire hearing and Senator Sessions
has graciously offered to chair the hearing. I would also,
again, say thanks to each of our distinguished panelists. I
look forward to reviewing your testimony and your responses and
I have some questions that I'll hope to have answered. The
record will remain open so that committee members can submit
written questions to the witnesses within 10 days of the
hearing and we would appreciate your expeditious effort to
answer those questions. That's the way that we'll be able to
turn this issue into reality.
Senator Kennedy is not here so I'll turn the proceedings
over to Senator Sessions and be a participant. I'll pass the
gavel.
Opening Statement of Senator Sessions
Senator Sessions [presiding]. All right. You're passing the
gavel already. Senator Enzi, thank you for your leadership. We
treated immigration--and it is appropriately assigned to the
Judiciary Committee, which I am a member, as more of a law
enforcement issue and enforcement question and that's where the
debates have all focused. But in truth, immigration is a very,
very important matter for our national economy. It is very
important for labor, which this committee has jurisdiction of
and oddly, in this whole process of the debate and I was in the
Judiciary Committee and was involved on the Floor, we had
almost no discussion of the great issues of immigration about
how immigration can benefit a Nation, how to maximize that
benefit, how to create an immigration policy that selects the
people who are going to be most successful in the country and
by inference, will be most beneficial to that country. It's
just a logical thing that we should, as we go forward,
consider.
In the Judiciary Committee we had one panel, at my request,
with the economists. Basically after the die had been cast on
the immigration bill. One or two of the economists said this
and the others nodded their heads and it is consistent with
what Professor Borjas said in his book, Heaven's Door--which I
think is the most authoritative compilation of data on
immigration afoot today--and it is, the first thing a nation
should do, is to decide whether or not immigration is in their
national interest and should it be in their national interest?
In other words, who is being served? Is it the people who want
to come or is it the nation who chooses who to receive. I think
the answer is pretty obvious, that the nation ought to set a
policy that serves its national interest. Any other argument, I
think, is not sound and what they said at that other hearing
was, once you make that decision, then it is pretty easy to do
a rational analysis of how to create a system that serves the
national interests. One of the things we want to think about
is, how many should come and in what fields of work, whether it
is skilled or low-skilled and a legitimate interest of this
committee is how it effects labor in this America and the
working people because we're passing bills and trying to help
working people in America in a lot of different ways and we
need to ask how immigration impacts our system.
So I'm glad that you've agreed to have this. This will be a
part of the record. We have, in these weeks here that we wrap
up this session, a lot of things happening at this very moment.
I should be in another hearing but I'm not and we're going to
take this record that we have today and I assure you, other
Senators will become educated on some of the issues that are
being raised here because I'll make sure that they are.
Senator Enzi, do you have any questions? Do you want me to
start with some questions? I guess the first thing I would say
that is most--oh, excuse me. I need a good chairman here,
somebody who is used to presiding. We are delighted to hear
from you at this point and then we'll go into our questions
later.
Mr. Beach. Tell us about the Canadian plan.
STATEMENT OF CHARLES M. BEACH, PROFESSOR
OF ECONOMICS, QUEEN'S UNIVERSITY
Mr. Beach. Yes. Can you hear me all right? Thank you very
much for inviting me to speak before the committee. Also, I
want to express my wholehearted sadness and sympathy for your
loss 5 years ago this week.
Canada has one of the major--is one of the major immigrant
receiving countries in the world and we've had about 30 years
of experience in running a point system, which will be one of
the main issues of discussion in today's session. I simplify a
bit but there are basically three major classes of immigrates
to Canada, corresponding to the different goals of immigration
policy. One is family class immigrants for family unification.
That represents about 27 percent of all immigrants coming in.
The figures are for 2000 but they are not much different now.
Second, is the independent or economic class, which are the
group of immigrants and their dependents who come in under an
evaluation system or point system and that is about 59 to 60
percent of all immigrants. That's quite different from the
United States. Third, there is a humanitarian class, largely
refugees, which is about 13 percent of the total.
Since the 1980s, there have been three major changes in
immigration policy in Canada. In the mid-1980s, Canada shifted
the total immigration levels from its previous regime, which
was called the tap on, tap off policy, where in recessions, it
is less absorbed to the capacity of the economy. The total
immigration levels were moved down a bit. You had expansions
when the absorbed to capacity increased, it was moved back up.
By the 1980s, for reasons that may come out in questions
here, Canada changed to a policy of essentially tap on at a
fairly high level, right through, including through a quite
severe recession in the early nineties. One can debate that,
but, that is still the approach we use.
The second major change is the policy shifted away from
emphasis on family class immigrates toward an emphasis on
independent class immigrates that come under the point system.
So to give you an idea of orders of magnitude, between 1980 and
2000, the number coming in under the point system rose from 35
percent to above 60 percent. That is quite a substantial
change.
Third, the weights are embodied in the point system and we
identify and evaluate skills under which to evaluate
prospective immigrants. That has changed in the 1990s from a
perspective of what is called occupational gap-filling or
targeted employment. You see that there is a shortage in some
occupations so you want to try to attract a bunch of people in
that occupation, away from that to one based on much broader,
we'll call human capital perspectives on things like language,
education and that sort of thing and age, and again, that can
come out in more discussions.
Basically, those three changes or at least the last two,
signal a shift in perspective immigration toward a much longer
view rather than a short-run, cyclical type response situation.
The Canadian immigration policy, then, operates--I view it in
terms of three sets of policy levers. One is the total level of
immigration, which can be changed to some extent, year to year.
Second is a portion of that total that comes under the point
system and third is the nature of the wigs embodied in the
point system itself. A recent study by some colleagues and
myself looked at the effects of these three levers on various
skill dimensions of arriving immigrants, such as education, age
and English/French language fluency of arriving immigrates and
the study found essentially two points for our purposes. First,
the point system works in the sense that increase in the
weights on a specific skill dimension does, indeed appear to
have an effect in raising average skill levels of incoming
immigrants and we have estimates as to the size of these
effects. Second, changing--interestingly, changing the
proportion of these three main levers. I talked about total
inflow, the proportion that come under the point system and the
weights in the point system. It is the second one. The
proportion coming in under the point system as economic class
immigrants, which appears to have the strongest impact, not
just in our own studies but in several others that have been
done as well.
So by way of conclusion, I think that bringing in a skill-
based point system means that you gain useful policy tools that
can have an effect on raising average skill levels of arriving
immigrants.
[The prepared statement of Mr. Beach follows:]
Prepared Statement of Charles M. Beach
1. background features of the canadian immigration system
The last decade has seen major changes in immigration policy in
Canada, one of the leading immigrant-receiving countries and the one
with about the highest per capita immigration rate in the world.
Figure 1 shows the profile of total immigration levels since 1980.
In 1985, the total number of immigrants troughed at 84.3 thousand. The
number then shot up in 1987 to 152.1 thousand and continued rising to
above 250,000 in 1992 and 1993. It then drifted down to 173.1 thousand
in 1998 and then moved up again to above 250,000 in 2001, from which it
has continued in the 220,000-230,000 immigrants per year range (out of
a population of about 30 million). The main feature of these results is
the distinct up-shift in total immigration levels in Canada beginning
in the mid-1980s that has generally continued.
Figure 1 also shows the number of immigrants in the major immigrant
classes. There are basically three such classes. Independent (or
Economic) class immigrants are those immigrants (and their dependants)
who are assessed for admission through a Point System. It includes
business class immigrants in the entrepreneur, investor and self-
employment categories, and a nominated or assisted relatives class
since these applicants also have to be assessed under the Point System.
The second major immigrant class is the Family class (family
unification), and the third is the Humanitarian class (mainly
refugees). The Family class immigrants are admitted solely on the basis
of kinship. Applicants in the latter two classes are not assessed under
the Point System. Figure 1 shows that the Family class and the
Independent (or Economic) class are the two largest classes. One also
notes from Figure 1 the marked cyclical nature of Economic class
inflows which generally increase in periods of economic growth in
Canada and decrease during periods of recession (1981-1983 and 1990-
1992), along with the general decline in Family class numbers since
1993.
Since 1980, there has also been substantial change in the country
or region of origin of Canadian immigrants (see Figure 2). The most
noticeable change here has been the increase in the numbers arriving
from the Asia and Pacific regions and, to a lesser though still
significant degree, from Africa and the Middle East. In the mid-1980s,
the numbers of immigrants arriving from Asia and Pacific ran around
30,000-35,000 a year, but by 1992 had moved up to over 100,000 a year
and peaked in 2001 at about 133,000 arrivals. Those from Africa and the
Middle East in the early to mid-1980s averaged around 8,000-9,000 a
year, but by 1991 moved up to over 40,000, and since 2000 arrivals have
run between 40,000 and 50,000 a year. Meanwhile, landings from Europe,
United Kingdom and the United States have been relatively stable over
the whole period with 41.8 thousand from Europe and the United Kingdom
and 7.5 thousand from the United States in 2004. In percentages terms,
though, they represent a declining share of the total inflow. There
have also been fluctuations in the numbers arriving from South and
Central America which averaged 14,000-17,000 a year in the early 1980s,
then moved up to 37,000 by 1991 and have since eased off to 19,000-
22,000 a year since 2001. The main point here is that there has been a
major shift in source country away from Canada's previously traditional
source regions of the United Kingdom, United States, Western Europe,
and English-speaking Commonwealth countries.
One of the distinguishing features of the Canadian system is that
the Immigration Act gives Citizenship and Immigration Canada (CIC),
through Cabinet approval and in consultation with the provinces,
considerable flexibility to set target levels for immigration flows by
immigrant class and to make changes to the relative weights built into
the Point System. No separate act of Parliament is required to make
these year-to-year changes, so there is considerable flexibility in how
the policy levers of the system can be adjusted.
Another distinguishing feature of the Canadian system is its Point
System which was brought in in 1967 as an objective way to assess the
admissibility of prospective immigrants while at the same time up-
grading the skill level of new arrivals. Table 1 sets out the
categories under which a prospective Independent candidate for
admission is judged along with the maximum number of points in each
factor and the pass mark needed to be admitted. The table covers the
period from the introduction of the Point System in 1967 until
recently. Despite major revisions to the Immigration Act over the last
three decades (i.e., in 1978 and 2002), the Point System has remained
at the core of assessing which Independent (or Economic) class
immigrants will obtain entry visas.
Under the Point System, prospective immigrants originally needed to
amass at least 50 out of a possible 100 points to obtain an entry visa
(nominated relatives received a 15-point bonus to cover a short-fall in
points earned in evaluating their case for admission). As Table 1
shows, prospective immigrants were judged on a wide variety of factors,
for example, age, education, work experience, occupational demand, etc.
Table 1 also shows that the weights assigned to these factors have
changed over time. Indeed, some categories actually disappeared while
new ones were introduced. Initially, at least, the weighting scheme for
the first two decades after the introduction of this scheme in 1967
reflected past immigration policy in the sense that it focused on
occupational needs in the economy at a particular point of time. The
total number of points awarded to occupational-directed categories
(i.e., occupational skill, experience, occupational demand, and bonus
points for designated occupations) totaled 43 out of a possible 100
points in 1986. The prospective migrant needed to get a certain number
of points out of 100 to be admitted to Canada. It is not necessary to
get points in every category. Hence a prospective migrant could score
high points for education, age, etc., and zero for occupation demand,
and still be admitted.
Now consider some of the skill characteristics of landed immigrants
since 1980. In Table 2, sample means are presented for education and
admission class for immigrants landed in Canada in 1980, 1990 and 2000.
The proportion of immigrants with an undergraduate or graduate
university degree rose dramatically over the period from 5.8 percent
and 1.8 percent, respectively, in 1980 to 25.1 percent and 9.0 percent
in 2000. The larger part of each increase occurred in the 1990s and is
almost surely due to the reform of the Point System used to select
immigrants to Canada under the skilled worker or Economic class
category of admission. The changes in 1993 specifically led to a large
increase in the weight placed on university education in selecting
skilled immigrants.
In contrast, the proportion of new immigrants with post-secondary
education below the university level rose from 16.5 percent in 1980 to
20 percent in 1990. However, it declined back to below its 1980 level
at 15.6 percent by 2000. The other large change in the education
distribution of newly landed immigrants over the period is the decline
at the secondary education level--from 59 percent in 1980 to 35 percent
in 2000. The overall result has been a fairly steady increase in the
average years of education of arriving immigrants.
The distribution of new immigrants across the different admission
categories has also varied considerably over the 20-year period. The
proportion of new immigrants in the Economic category rose from 34.9
percent in 1980 to 44.2 percent in 1990 then to 58.7 percent in 2000.
These increases coincided with decreases in the share of new immigrants
arriving under the Family class (35.9 percent in 1980 to 26.6 percent
in 2000) and the Humanitarian class (28.2 percent in 1980 to 13.2
percent in 2000). The larger part of the decline in the share of the
Humanitarian category occurred between 1980 and 1990, while the larger
part of the decline in the Family class (and the increase in the share
of the Economic category) occurred between 1990 and 2000. The
Humanitarian class intakes are, of course, largely influenced by
refugee crises around the world.
2. recent major reforms in canadian immigration policy
The 1980s and 1990s saw three major changes in immigration policy
in Canada. These also highlight three distinct policy levers available
to policymakers. First, the approach to handling total immigration
levels changed. Up until the middle 1980s, Ottawa had traditionally
followed a ``tap-on/tap-off '' policy where immigration inflow levels
were allowed to rise in periods of economic growth when there was a
high absorption capacity for new labor market participants, and then
the levels were purposedly reduced in times of recession when
absorption capacity was weak. In the middle 1980s, however, total
immigration levels were substantially raised (see Figure 1) and then
kept on at a relatively high level right through the quite severe
economic recession of the early 1990s. This was done perhaps partly for
political reasons. But it also marked the beginnings of a shift of
perspective on immigration policy away from short-run or cyclical
objectives and toward a longer-run more economic growth-oriented
perspective.
The second major change in immigration policy was shift away from
an emphasis on Family-class immigrants and a family reunification role
of immigration toward an emphasis on Independent or Economic-class
immigrants (and their dependants). This occurred in the early to mid-
1990s and was spurred on by the rapidly rising costs of immigration in
the recession of the early 1990s and by a general public perception of
abuses in the system at the time. But again, it illustrated an on-going
shift of underlying perspective that immigration should be serving a
skill development role for the economy and a policy tool to foster
labor productivity and economic growth (which were lower in Canada than
in the United States causing some concern in the Canadian government).
So a priority became to raise the proportion of total immigrants who
would be coming in under a skill-based screening system. (Policy also
was changed to narrow the definition of ``family'' in the Family class
category away from the previous extended-family definition to a more
North American style nuclear-family concept.)
The third change, also in the mid-1990s, was to the Point System
under which Economic class immigrants are evaluated for entry.
Previously, the weights in the Point System had been based on an
occupational preference or gap-filling or targeted employment model
where specific occupational needs were identified and those applicants
who could fill these needs were given preference for admission. But by
the mid-1990s there was growing frustration with this approach. It was
an attractive concept, but it was bedeviled by implementation problems
in actual practice. To be useful, the program had to get into quite
detailed occupational breakdowns (e.g., a civil engineer is not the
same thing as an electrical engineer), and these were very cumbersome
to deal with by an administrative bureaucracy. There were also
frustrating lags in identifying local labor market needs, aggregating
this information up, and then conveying it in timely fashion to
immigration offices abroad for dissemination to prospective applicants.
By the time this process was done, the original labor shortage may no
longer exist or--even worse perhaps--the economy was now in a recession
and all applications were being put on hold. In general, this approach
led to an unwieldy bureaucracy that was felt to be unresponsive and not
sufficiently timely. It also led to criticism and frustration both
abroad and at home. And there was wariness that the pace of industry
restructuring (under NAFTA) and economic change would be speeding up
with accelerating information technology developments.
So after an extensive review, in place of the gap-filling model was
substituted an earnings or human capital model perspective. Under this
approach, specific occupational needs were reduced in the Point System
weighting scheme while additional points were awarded to education, age
(particularly youthfulness as a proxy for flexibility and adaptability)
and official language fluency (all three of these categories had been
present from 1967 but were given lower weights than those categories
dealing with occupational demand). The rationale for the change was
that the higher prospective immigrants scored in these three categories
the more easily they would adapt to their new home country and hence
the more rapid their ascent to parity in earnings to similarly placed
native-born workers. Thus by the mid-nineties, education, facility in
one or both of the native languages (i.e., English and French) and age
accounted for 59 of the 100 total points, with only 70 points needed
for the pass mark. This shift in weights in Canada signalled a move
toward a longer-run view of immigration policy. Less emphasis was
placed on gap filling and more on the factors that supposedly
influenced the long-run adaptability of the new migrant.
This discussion, then, highlights the three policy levers I wish to
focus on in this statement: (i) the total level of immigrant inflows in
a year, (ii) the proportion of the total inflow in the Economic class
category, and (iii) the Point System weights for the general skill
levels of educational attainment, (youthful) age, and (English/French)
language fluency. In the Canadian Point System, zero points are awarded
for a principal applicant having less than a high school diploma,
maximum points for a 4-year university degree, and partial points for
various types of high school and post-secondary training. In the case
of age, full points are awarded for principal applicant's age between
21 and 49, and decreasing partial points for age further away from the
21-49 age interval. In the case of language, zero points are awarded if
the principal applicant speaks English and French very haltingly, full
points if they are fluent in both official languages, and partial
points based on reading, writing and speaking of English and French.
3. impacts of the point system and policy levers on skill
characteristics
of canadian immigrants
The discussion in this section follows the analysis of a recent
empirical study by Charles Beach, Alan Green and Christopher Worswick
entitled ``Impacts of the Point System and Immigration Policy Levers on
Skill Characteristics of Canadian Immigrants'' (March 2006) that has
been provided to the committee. This paper examines how changes in the
above three immigration policy levers actually affect the skill
characteristics of immigrant arrivals using a unique Canadian immigrant
landings database consisting of all immigrants who arrived in Canada
between 1980 and 2001. The skill characteristics of arriving immigrants
that are examined in this study are their level of education, their
age, and their fluency in either English or French. We use regression
statistical techniques to estimate reduced-form equations in order to
investigate whether the above three sets of policy lever changes (as
explanatory variables) have indeed had identifiable effects on these
three skill characteristics (as dependent variables) of the arriving
immigrants to Canada over the 1980-2001 period. These three skill
dimensions are generally acknowledged as the major skill indicators for
immigrants that the literature focuses on.
Several hypotheses are examined in this paper relevant to the
effect on arriving immigrants' skill levels of our three policy
drivers. The first refers to total immigration inflow rates: does a
larger size of immigrant inflows reduce the overall skill levels of
arriving cohorts as the larger numbers of immigrants are likely to be
closer to the Point System cut-off line (in the case of Economic class
immigrants) and to bring in more relatives (in the case of Family class
immigrants) who generally adjust more slowly in integrating into the
Canadian labor market? The second refers to Economic vs. non-Economic
class immigrants: do Economic class immigrants have higher average
skill levels, and thus other things being equal, does an increase in
the share of Economic class immigrants in response to shifting
government priorities raise the overall skill levels of arriving
immigrant cohorts since it is the Economic class arrivals who are
essentially admitted on the basis of their skill? The third hypothesis
refers to operation of the Point System: does increasing the Point
System weight on some skill dimension--such as educational attainment--
indeed have the desired effect of raising overall skill levels of
immigrant arrivals in this dimension? And the fourth refers to business
cycle effects: does a weaker labor market in Canada result in
attracting fewer skilled immigrants so that overall skill levels of
arriving cohorts of immigrants are reduced? And, by extension, does a
weaker labor market in the United States (a substitute destination),
ceteris paribus, lead to an increase in the overall skill levels of
immigrants selecting to come to Canada?
The answer to each of these hypotheses turns out to be ``Yes''.
Five main findings arise from the empirical analysis of this paper
and that may provide some useful input to the current U.S. debate.
First, with respect to total immigration rates, it has been found that
increasing overall annual inflows of immigrants lowers the average
skill levels of the arriving cohort. This reduction in skill levels
occurs most strongly for educational attainment of arriving immigrants,
more moderately with respect to age of arriving immigrants, and very
weakly (if at all) for official language fluency of immigrants. For
example, raising total inflow levels by 100,000 per year (or by about
35 percent from recent levels) is estimated to reduce average years of
education of Economic class immigrants by 2.6 percent, to increase
their average age by 1.7 percent, and to reduce the average rate of
English or French language fluency by 0.2 percent.
Second, for a given level of total inflow, increasing the
proportion of skill-evaluated or Economic class immigrants--at least in
the way they are designated in the Canadian system--is found to raise
the average skill levels of immigrants as a whole. Increasing the
Economic class share in total immigration has its strongest effect on
official language fluency of arriving cohorts, has a significant effect
on average education levels, and has a moderate effect on average age
of arriving immigrants. For example, raising the Economic class share
of total immigration by 10 percentage points is estimated to increase
average levels of education of all immigrants by 1.5 percent, to reduce
their average age by 2.0 percent, and to increase their official
language fluency rates by about 2.7 percent.
Third, it is found that business cycle effects on skill level
outcomes of immigrants to Canada are highly statistically significant,
and generally operate so that higher Canadian unemployment rates reduce
average skill levels of arriving immigrants and higher U.S.
unemployment rates have the opposite effect.
Fourth, with respect to the operation of the Canadian Point System
itself, it has been found that increasing the weights on specific skill
dimensions within the Point System schedule indeed has the intended
effect of raising average skill levels in this dimension among skill-
evaluated applicants. Basically, the Point System does appear to work
as it is intended. The strongest effects occur for education,
moderately strong for language fluency of immigrants, and rather weak
effects occur on age of arriving immigrants. For example, if there is a
10 percentage point increase in the weight allocated to a specific
skill measure within the Point System, the result is that the average
years of education of principal applicants are estimated to increase by
2.7 percent, their average age declines by 0.6 percent, and their
average official language fluency rate goes up by 1.2 percent.
This study identified three broad sets of policy tools for bringing
about improvements in immigrant outcomes. One is a change in the total
rate of inflow of immigrants, the second is a change in the Economic
class share of total immigration, and the third is various changes in
the Point System weights allocated to various skill dimensions. But
which of the three policy tools appears to be most effective in
bringing about desired changes in the skill outcomes of arriving
immigrants? The proportion of Economic class immigrants seems to have
the strongest across-the-board impact. The education outcome variable
also stands out as being the most responsive among the three-skill
dimensions. In general, the Point System appears to have strong effects
on education outcomes of arriving immigrants, moderate effects on
language fluency outcomes, and rather weak effects on age outcomes of
arriving immigrants.
4. conclusions and recommendations
We can identify two sets of conclusions: those based on the
statistical analysis of policy lever effects, and those based on past
Canadian experience with their Point System.
Turning first to the statistical results of the previous section,
four points deserve mention:
1.1 Increasing the total inflow rate of immigrants lowers the
average skill level of arriving immigrant cohorts.
1.2 Increasing the proportion of Economic class immigrants raises
the average skill levels of immigrants as a whole.
1.3 Increasing the weight on specific skill dimensions within the
Point System schedule indeed has the intended effect of raising average
skill levels in this dimension among skill-evaluated immigrants.
Basically, the Point System works as intended.
1.4 In terms of the relative effectiveness of the alternative
policy levers:
the proportion of Economic class immigrants seems to have
the strongest effects;
the level of education of immigrants stands out as being
the most responsive among the three-skilled dimensions; and
the Point System appears to have strong effects on
immigrants' education levels, moderate effects on language fluency
outcomes, and rather weak effects on the average age of arriving
immigrants.
Turning next to the lessons from Canadian experience with their
Point System, one can highlight several further points:
2.1 A human capital-based Point System seems to be an improvement
over an occupational preference-based system because of operational
problems with the latter.
2.2 By bringing in a Point System (applied to a skill- or
occupation-evaluated class of immigrants), you would gain useful policy
tools which can have effects of raising average skill levels of
arriving immigrants.
2.3 If bringing in a Point System for a class of immigrants, try to
keep it relatively simple and transparent and based on a relatively
small number of skill dimensions such as education, age and language
fluency.
2.4 If bringing in a Point System with substantial weight placed on
the education level of immigrants, give some attention to how to deal
with issues of foreign credential recognition.
2.5 If bringing in a Point System, allow for some input from local
and regional authorities on their evolving labor market needs.
2.6 If bringing in a Point System, you might give some thought to
allowing points for the spouse's or family unit's skill characteristics
rather than just the skill characteristics of the principal applicant
of the family unit.
2.7 If bringing in a Point System, one can allocate points for
designated occupational needs, so use of a Point System can be viewed
as complementary to an occupational gap-filling approach rather than a
direct alternative to it.
Charles Beach was born in Montreal in 1947. He attended McGill
University and did his Ph.D. at Princeton University. Since 1972 he has
taught economics at Queen's University in Kingston, Ontario, Canada.
His areas of research have been on applied labor market analysis and
distribution of income. He is co-editor (with Alan Green and Jeffrey
Reitz) of Canadian Immigration Policy for the 21st Century (McGill-
Queen's University Press, 2003) and co-author (with Alan Green and
Christopher Worswick) of ``Impacts of the Point System and Immigration
Policy Levers on Skill Characteristics of Canadian Immigrants'' (2006).
He is also program director on immigration for the Canadian Labour
Market and Skills Researcher Network.
Table 1.--The Canadian Points System Over Time \1\
[Maximum Points]
----------------------------------------------------------------------------------------------------------------
Factor 1967 1974 1978 1986 1993 1997 \2\
----------------------------------------------------------------------------------------------------------------
Education........................................ 20 20 12 12 16 16
Experience....................................... 8 8 8 8
Specific vocational preparation or education 10 10 15 15 18 18
training factor.................................
Occupational demand or occupational factor....... 15 15 15 10 10 10
Age.............................................. 10 10 10 10 10 10
Arrange employment or designated occ............. 10 10 10 10 10 10
Language......................................... 10 10 10 15 15 15
Personal suitability............................. 15 15 10 10 10 10
Levels adjustment factor \3\ or demographic 5 8 10
factor..........................................
Relative \4\..................................... 5 5 5
Kinship bonus \5\................................ 10/15 5 5
Destination...................................... 5 5 5
--------------------------------------------------------------
Total.......................................... 100 100 100 95-105/110 105-110 107-112
Pass Mark \6\.................................. 50 50 50 70 70 70
----------------------------------------------------------------------------------------------------------------
Source: Green and Green (1999), p. 433, plus updated information from CIC.
\1\ A discretionary allocation that can be used to control the number of persons entering over a period.
\2\ Source: Statutory Orders and Regulations 97-242 and Citizenship and Immigration Canada policy manual
(Overseas Processing) chapter 5 under the Immigration Act 1976.
\3\ The pass mark varies by skill level.
\4\ Relative factor was eliminated as of 1986 as a selection factor for Independent/Skilled Worker applicants.
\5\ January 1, 1986 regulatory change established a ``kinship bonus'' for ``Assisted Relative'' applicants.
Prior to the 1986 change, ``Assisted Relative'' applicants were not assessed on the following factors:
Arranged employment, Language, Relative and Destination. Total and Pass Mark varied under each regime for the
Assisted Relatives.
\6\ The pass mark applied to the Independent/Skilled Worker applicants.
Table 2.--Immigrant Characteristics at Landing Level of Education and
Admission Category, 1980, 1990, and 2000 (proportions)
------------------------------------------------------------------------
Canada
------------------------------------------------------------------------
1980 1990 2000
------------------------------------------------------------------------
Education:
University--Post-Graduate.......... .0177 .0289 .0902
University--Undergraduate.......... .0583 .1100 .2506
Post-Secondary..................... .1645 .1996 .1558
Secondary.......................... .5898 .5316 .3526
Elementary or Less................. .1676 .1297 .1507
Admission Category:
Economic........................... .3486 .4419 .5870
Family Class....................... .3587 .3436 .2663
Humanitarian....................... .2819 .1668 .1322
Other.............................. .0108 .0477 .0145
--------------------------------
Total No. of Landings................ 143,136 216,402 227,313
------------------------------------------------------------------------
Source: Calculations by the authors from the CLD data.
Senator Sessions. Thank you.
Mr. Borjas.
STATEMENT OF GEORGE J. BORJAS, PROFESSOR OF
ECONOMICS AND SOCIAL POLICY, KENNEDY SCHOOL
OF GOVERNMENT, HARVARD UNIVERSITY
Mr. Borjas. Thank you very much for providing me the
opportunity to come before the committee to talk about my work
and my thoughts on this issue. You are addressing issues that
are really--unfortunately, we don't address them very often--at
the core of the immigration debate in this country. The reason
is that many more people want to come to the United States than
the country is willing to admit. So because of this,
immigration policy needs to specify a set of rules to pick and
choose from the many, many applicants. These rules could stress
family ties, as is done now or could stress national origin the
way it used to be done or it could stress economic valuables
the way Canada does or it could even be completely random, the
way our lottery system does for 50,000 visas.
The crucial question that is really at the core of the
immigration debate is, which set of rules should the United
States have if it wants to improve economic well being of its
population? So what I want to do today is sort of summarize for
you what an economic case for a high-skilled immigration policy
would be, like the one that Canada has or that Australia has.
The reason we have to consider that is that for the last 40-50
years, there has been a pretty steep decline in the skills of
Americans as compared to the skills of natives. Just to give
you an idea of the extent of the decline, in 1960, the typical
immigrant worker in the United States earned about 7 percent
more than the typical native worker at that point in time.
Right now, the typical immigrant worker in the United States
earns almost 20 percent less than the typical native worker in
the workforce today.
One thing we know from economics is that all the skills of
immigrants compared to the skills of natives is a crucial
factor that determines economic impact on immigration. Why
should we care about this? Because just think about a few
variables that enter the equation. One thing is that, if you
have a skilled immigrant population, those skilled immigrants
may well have gotten much more rapidly to the U.S. labor market
and can really make a very significant contribution to economic
growth. If, on the other hand, immigrants lack the skills to
adapt, they may well increase the size of the population that
requires public assistance and increase ethnic and racial
inequality.
On top of that, as the debate of immigration policy in the
last few months have shown, Americans care quite a bit about
the potential impact that immigrants have on the employment
opportunities of native workers. Any kind of low-skill
immigrant influx will tend to have a proportionally adverse
impact on most skilled natives already here. In other words,
the loss of planned demand suggests that at least in the short
run, when immigrants arrive, they tend to affect adversely the
employment opportunities of competing native-born workers and
that would tend to increase the social and economic inequality
that exists in this country.
Last but not least, there is an additional case for making
a high-skilled immigration policy and that is that, as I will
discuss in a minute, it turns out economic benefits for
immigration can be substantially improved if the immigrant
population were much more skilled than it is today.
So let me go through the basic factors again, in a little
more detail. There are three parts that I want to discuss in
particular, in the brief time I have. First of all, consider
the fiscal impact of immigration. High-skilled immigrants earn
more, pay higher taxes, and require fewer services than low-
skilled immigrants. So from a fiscal perspective, there is no
doubt whatsoever that high-skilled immigration is a good
investment, particularly when compared to the immigration of
low-skilled workers.
Second, what happens to productivity when there is high-
skilled immigration? Although there is some disagreement among
economists as you've heard in the last few months, about how
much wages fall when immigrants come into the labor market and
compete in the workforce, I think there is actually much less
disagreement among economists with the following proposition,
that the net benefit from immigration would increase and
perhaps increase substantially, if the immigrant influx were
much more skilled than it is today.
In some of the populations I did in my book, Heaven's Door,
I found that the net benefits to the country would increase
four-fold, from about $10 billion annually to $40 billion
annually if the immigrant influx were to change from being
predominantly low-skilled, which is what we have now, to
predominantly high-skilled. The key reason for this increased
gain is that a productive infrastructure of the U.S. economy,
where an economist would cold-cap the capital stock, tends to
be more complimentary with high-skilled workers than it is with
low-skilled workers. So the available resources that we now
have would be much more productive and much more profitable if
immigrants were more skilled.
Finally, the immigration of high-skilled workers would tend
to have much more favorable distributional effects. Instead of
being the low-skilled workers who are suffering from having
more immigrants competing in the workforce, it would be high-
skilled workers who already reside in the United States who
would face more competition and lower wages. So there would be
less rather than more wage inequality.
How can the United States select skilled immigrants,
skilled workers from the pool of applicants? Well, as you have
just heard, we can actually develop a point system that would
reward certain economic characteristics in determining entry.
Now, needless to say, any point system that we choose will be
inherently arbitrary. But it isn't clear, however, that an
existing point system like the Canadian one, is any more
arbitrary than what we have now and by that I mean the
following. Even though the United States would never admit
officially that we have a point system, in fact, we do have
one. But unlike the Canadian system, for the large bulk of
legal immigrants, there really is only one variable we look at
and the variable we look at is, do you have family already
residing in the United States? So a broadening effect of that
system to include other variables seems quite sensible from an
economic perspective.
Now the problem with what I've just said is that I haven't
given you any kind of feel for what the number of visas should
be. Even though high-skilled immigration would be beneficial to
the United States, it is far from clear--and let me emphasize,
it is far from clear that the argument actually implies that we
want to have an open-door policy when it comes to skilled
immigration. A sensible way of thinking about what the magic
number should be is to just imagine counter factual. What would
happen, for example, if we admitted 1 million highly skilled
workers annually instead of our current policy? Well, just
think about it. Over a 20-year period, we would be admitting
roughly 20 million high-skilled workers. Well, right now, there
are approximately 30 million college graduates working in the
United States. Just imagine what the high-skilled labor market
would look like if, on top of the 30 million college graduates
now here, you added a supply increase of 20 million high-
skilled workers. Clearly, there would be a pretty sizable
reduction in the relative wage of college graduates in this
country.
This reduction that returns to a college education would
have severe consequences in terms of being sent native students
to continue on to college and particularly, it would affect the
people at the margin of the college decision. So for example, a
lot of disadvantaged native workers who face the highest costs
in terms of going to school, would at the margins, say to
themselves, ``Why bother going to school when the return for a
college education has fallen so much.'' So one has to take into
account the consequences that a high-skilled immigration
population would have on people already here, both in terms of
the labor market and in terms of the investment decisions of
human capital that people will be making in the future.
Let me just conclude by making a very brief point. There
are difficult trade-offs involved in this decision. Pursing a
particular immigration policy might help some groups, might
even help the whole Nation but it may hurt other people. So the
adoption of any specific entry rules will create winners and
losers. It is actually helpful to keep in mind an important
lesson from economics when thinking about this. There is no
such thing as a free lunch. Thank you.
[The prepared statement of Mr. Borjas follows:]
Prepared Statement of George J. Borjas
The United States offers unequaled social, political, and economic
opportunities to anyone lucky enough to enter its borders. Because of
these opportunities, many more people want to come to the United States
than the country is willing to admit. Consider the ``diversity
lottery'' that the United States has held annually since 1995. Each
year, around 50,000 visas are made available to persons originating in
``countries with low rates of immigration to the United States.''
Persons living in the eligible countries can apply for a random chance
at winning one of the coveted entry visas. Potential migrants applied
for the 2005 drawing by submitting an application between October 5,
2005 and December 4, 2005. This lottery drew 5.5 million qualified
applications for the 50,000 available visas.
Because of the excess demand for entry visas, immigration policy
has to specify a set of rules to pick and choose from the many
applicants. These rules may stress family ties (as is currently done
for the vast majority of legal immigrants), or national origin (as used
to be done), or socioeconomic characteristics (as is done in other
countries such as Australia and Canada). Which entry rules should the
United States have?
Before 1965, immigration to the United States was regulated by the
``national origins quota system.'' In that system, the fixed number of
entry visas was allocated on the basis of national origin, with each
country's share depending on the representation of that ethnic group in
the U.S. population as of 1920. As a result, Germany and the United
Kingdom received almost two-thirds of the available visas. Immigration
from Asia was effectively banned. Finally, few persons migrated from
Latin America despite the fact that the national-origins quota system
did not set a numerical limit on migration from countries in North and
South America.
The rekindling of the immigration debate has its roots in the 1965
Amendments to the Immigration and Nationality Act. The 1965 Amendments
(and subsequent minor legislation) repealed the national origins quota
system, set a world-wide numerical limit, and enshrined a new objective
for awarding entry visas among the many applicants: the reunification
of families. In 2005, almost 60 percent of the legal immigrants entered
through one of the family reunification provisions of the law.
The policy shifts in the 1965 Amendments had a profound impact on
the size of the immigrant flow into the United States. Even though only
250,000 legal immigrants entered the country annually during the 1950s,
almost 1 million were entering by the 1990s. As a result of these
trends, and also because of the rapid increase in the number of illegal
immigrants, the proportion of foreign-born persons in the population
began to rise rapidly, from 4.7 percent in 1970, to 7.9 percent in
1990, to over 11 percent by 2000.
The post-1965 resurgence of large-scale immigration to the United
States has motivated many researchers to document and examine various
aspects of the economic and social consequences impact of immigration.
A key result in that literature is that the relative skills of the
immigrant population have dropped precipitously since 1965. In 1960,
for example, the typical immigrant earned about 7 percent more than the
typical native worker. By 2000, the typical immigrant earned about 19
percent less than the typical native worker. It is often argued that
this relative decline in immigrant skills can be attributed to the fact
that current U.S. immigration policy over-emphasizes family links
between U.S. residents and visa applicants in awarding entry visas, and
largely ignores the skills of the applicants. The deteriorating
economic status of the immigrant population has sparked a debate over
whether the goal of immigration policy should be shifted away from
family reunification, and should focus instead on the potential
economic impact of the immigrants.
We care about the relative skills of immigrants for a number of
reasons. For example, immigrants who have high levels of productivity
and who adapt rapidly to conditions in the host country's labor market
can make a significant contribution to economic growth. Conversely, if
immigrants lack the skills that employers demand and find it difficult
to adapt, immigration may increase the size of the population that
requires public assistance and exacerbate ethnic and racial inequality.
Similarly, the debate over immigration policy has long been fueled
by the widespread perception that immigration has an adverse effect on
the employment opportunities of natives. A key insight of economic
theory is that immigration has distributional impacts, reducing the
income of workers who compete with immigrants and raising the income of
those who employ immigrants or purchase immigrant-
provided services. A low-skill immigrant influx would likely harm low-
skill native workers, further increasing the economic and social
problems associated with rising wage inequality.
The case that can be made for preferring one type of immigrant to
another will ultimately depend on what one assumes about the country's
policy objectives. More specifically, what should the United States
seek to accomplish from immigration? As I have stressed repeatedly in
my work, different policy goals will inevitably lead to different
decisions about the composition of the immigrant population. For
example, if immigration policy should strive to relieve the tax burden
on native-born taxpayers, it would be fiscally irresponsible to admit
millions of low-skill immigrants who have a high propensity for
participating in public assistance programs. In contrast, if the goal
were to help the poor of the world by giving many of them an
opportunity to live and work in the United States, the increased cost
of maintaining the welfare State is the price that Americans are
willing to pay for their generosity.
The case for skilled immigration is based on one particular
assumption about the policy goal. In particular, suppose that
immigration policy should seek to improve the economic well-being of
the population currently residing in the United States (which, for
simplicity, I will refer to as ``natives'').
One could obviously argue over whether this policy goal accurately
represents what Americans should want to accomplish from immigration.
Nevertheless, the economic well-being of the native-born population has
played and continues to play a very influential role in determining the
shape and direction of immigration policy.
Suppose then that the goal of immigration policy were to maximize
the economic well-being of the native population. And suppose that
native economic well-being depends both on per-capita income and on the
distribution of income in the native population. In particular, the
country wants to pursue an immigration policy that makes natives
wealthier, but that does not increase the income disparity among
workers already in the country. What type of immigration policy should
the United States then pursue? More specifically, which types of
immigrants should the country admit, high-skill or low-skill workers?
A strong case can be made that the economic well-being of natives
would improve most if the country adopted an immigration policy that
favored the entry of high-skill workers. The argument in favor of this
policy contains three distinct parts. Consider first how the fiscal
impact of immigration affects the native population. High-skill
immigrants earn more, pay higher taxes, and require fewer social
services than low-skill immigrants. Put simply, high-skill immigration
increases the after-tax income of natives, while the tax burden imposed
by the immigration of low-skill workers probably reduces the net wealth
of native taxpayers. From a fiscal perspective, therefore, there is
little doubt that high-skill immigration is a good investment,
particularly when compared to the immigration of low-skill workers.
The second part of the case for skilled immigration relies on how
immigrants alter the productivity of the native workforce and of
native-owned firms. Although there is a lot of disagreement among many
economists about the magnitude of the costs and benefits of current
immigration policy (which is predominantly composed of low-skill
workers), there is much less disagreement with the proposition that the
net gain from immigration would increase, and perhaps increase
substantially, if the immigrant influx were more skilled. For example,
some of the tabulations that I conducted in Heaven's Door (Princeton
University Press, 1999) indicated that the net annual income accruing
to the native population could increase four-fold (from about $10
billion to $40 billion in the short run) if the immigrant influx were
to change from 30 percent high-skill to 100 percent high-skill. The
reason for the additional gains is that the productive infrastructure
of the U.S. economy--what economists call the ``capital stock''--is
more complementary with high-skill than with low-skill workers. Hence
native-owned resources would be more productive (and profitable) with a
high-skill immigrant influx.
Finally, skilled immigration has more favorable distributional
effects. The skilled workers who already reside in the United States
will face more job competition and lower wages. As a result, there will
be less, rather than more, wage inequality.
How can the United States select skilled workers from the pool of
visa applicants? In the past few decades, Australia, Canada, and New
Zealand have all instituted point systems that reward certain
socioeconomic traits in the admissions formula. In Canada, for example,
visa applicants are graded in terms of their age, educational
attainment, work experience, English or French language proficiency,
and occupation. Those applicants who score enough points qualify for
entry into Canada, while those who fail the test are denied entry.
Needless to say, any point system is inherently arbitrary. It is
unclear, however, that the Canadian point system--with its detailed
gradations for different types of jobs and different types of workers--
is any more arbitrary than the one currently used by the United States,
where entry, for the most part, is determined by the answer to a single
question: does the applicant have relatives already residing in the
United States?
It is worth emphasizing that the notion that the United States
would benefit more from a high-skill immigrant influx does not imply
that the United States should adopt an open-door policy when it comes
to admitting skilled workers. Even though there is a good economic case
in favor of high-skill immigration, the available studies provide few
guidelines for choosing the ``right'' number of high-skill immigrants.
A sensible way of posing the ``numbers question'' is to imagine a
counterfactual: what would be the nature of the immigration debate if
the immigrant flow were composed of 1 million highly skilled workers? I
believe the United States would still be in the midst of a debate, and
perhaps an even more heated debate. After all, this type of immigration
would have substantial distributional consequences on some well-
organized, highly educated, and highly vocal constituencies. The
political reactions of some professional groups--such as engineers,
computer programmers, and mathematicians--to the economic impact of
increased immigration in their fields stress precisely these
distributional impacts (immigration lowers wages!).
A flow of 1 million high-skill workers per year would probably have
a very large impact on the earnings of high-skill workers already in
the country. To get a rough sense of the magnitude, suppose the United
States enacted an immigration policy that admitted 1 million college
graduates, and that this policy was in effect for two decades. By the
year 2025 or so, roughly 15 million high-skill workers would have been
added to the workforce (assuming that 75 percent of the high-skill
immigrants were working at that time). There were approximately 32
million college graduates employed in the United States in 2004.
Immigration would effectively increase the supply of college graduates
by around 50 percent. The available evidence suggests that a 10 percent
increase in labor supply may reduce the wage of competing native
workers by 3 percent. A 50 percent increase in skilled labor supply
would then reduce the wage of college graduates by 15 percent!
This reduction in the returns to a college education would probably
influence the college enrollment decisions of many native students.
After all, going to college is expensive, both in terms of tuition and
in terms of the potential earnings that students forego while in
school. If a particular social policy were to reduce the returns to
such an investment by 15 percent, many students would probably respond
by deciding not to get a college education at all. Moreover,
disadvantaged native students may well be more sensitive to the decline
in the returns to college, and their enrollment rates could easily drop
the most. These are the students, after all, who can least afford to
attend college and who would quickly discover that the shrinking
returns to a college education do not justify the cost.
There is, therefore, some limit to how much immigration should
narrow income inequality. Put bluntly, the potential for millions
(perhaps even tens of millions) of high-skill workers to enter from
such countries as China and India should indicate to any prudent
observer that some limitations on the number of skilled workers that
enter the country is required.
Let me conclude by reemphasizing that the economic case for high-
skill immigration versus family reunification hinges entirely on an
assumption about the country's policy objectives. High-skill
immigration is the best policy if the United States wishes to maximize
the economic well-being of the native population. This assumption
obviously ignores the impact of immigration on many other
constituencies, such as on the immigrants themselves (who would clearly
prefer to be reunited with their families) and on the vast population
that remains in the source countries. The United States, for instance,
might choose to drain the labor markets of many source countries from
particular types of skills and abilities (such as high-tech workers).
Such a brain drain would probably have a detrimental effect on economic
growth in those countries.
In short, there are difficult tradeoffs. Pursuing a particular
immigration policy might help some groups, such as native workers, but
may hurt others. As a result, the adoption and implementation of any
specific immigration policy will leave winners and losers in its wake.
In the end, the goals of immigration policy must inevitably reflect a
political consensus that inevitably incorporates the conflicting social
and economic interests of various demographic, socioeconomic, and
ethnic groups, as well as political and humanitarian concerns.
(Professor Borjas is the Robert W. Scrivner Professor of Economics
and Social Policy at the John F. Kennedy School of Government, Harvard
University; and a Research Associate at the National Bureau of Economic
Research.)
Senator Sessions. That's a good economic principle.
Mr. Borjas. Yes.
Senator Sessions. I think Mr. Massey would agree that there
is no free lunch. Great to have you, sir.
STATEMENT OF DOUGLAS S. MASSEY, OFFICE OF POPULATION RESEARCH,
PRINCETON UNIVERSITY
Mr. Massey. Thank you. There is nothing wrong with creating
an immigration policy that takes into account the skills,
education and abilities of people. In fact, the United States
has such a system. Around 20 percent of immigrants currently
enter on visas reserved for workers with these characteristics.
Given that the United States is the world's largest economy and
has an unparalleled infrastructure for investment, research and
innovation, it generally does quite well in the global
competition for human capital. In order to compete with the
United States, smaller countries have created visa allocation
systems that give relatively greater weight to education,
skills and abilities. In recent years, 40 percent of
Australia's immigrants arrived in skilled or professional
categories, as we've heard today, and an even larger share of
Canada's arrive in these categories. A skill-based system gives
these countries some hope of competing with the colossus in the
world economy that is the United States.
I would not advocate a similar heavy emphasis on skilled
immigration in the United States for several reasons. First, we
don't really need such a system because the United States
already does very well in the global market for skilled labor.
In my own department in Princeton, 30 percent of my faculty are
foreign born. To the extent that the United States has problems
in human capital formation, then cherry-picking talent from
around the world is only a stop-gap measure that doesn't solve
the problem. In the long run, the primary source of America's
skills, talents and education must come from investments in its
people by funding education, training and research at home. We
spend just 3.8 percent of GDP on primary and secondary
education, well behind our competitors in the developed world.
Not only is immigration a poor substitute for basic
investments in education and training, it is less reliable as a
source of human capital. Immigrants are, by definition, mobile
and they can depart as easily as they arrive. Within Australia,
for example, in any given year, the arrival of immigrants is
offset by a 25 percent rate of immigration among former
arrivals. Of those who depart, 56 percent are professionals. A
recent analysis I did of newly arrived immigrants in the United
States found that dissatisfaction with life in the United
States goes up sharply as education rises and the more
dissatisfied immigrants are, the less likely they are to want
to naturalize and the more likely they are to leave the
country.
Admitting immigrants simply because they possess skills can
also create problems. Although Canada admits a lot of
immigrants in the skilled categories, it is not an unmitigated
model of success. Unsuccessful integration by skilled
immigrants is increasingly common and is now recognized as a
serious policy concern. The principle reason for failed
integration is the inability of immigrants to find meaningful
employment in their profession. As a result of the gap between
the number of skilled immigrants arriving in Canada and the
ability of the country to absorb them, immigrants there have an
exceedingly high rate of poverty. According to Statistics
Canada, some 36 percent of immigrants who arrived in the past 5
years earn poverty-level wages, a percentage that rises to 51
percent among immigrants from South Asia. The dashed hopes
helps to explain the growing resentment and political
attraction to radical Islam in some of Canada's Muslim
populations. By way of comparison, the rate of poverty among
immigrants in the United States is just 18 percent, compared
with 11 percent among natives.
Not only does a skill-based immigration policy suffer as a
human capital development strategy, it doesn't make sense by
itself, as an immigration policy either. Immigration policies
must balance many competing issues, one of which is skills
needed for the economy. Although Australia emphasizes skills in
admitting immigrants, it still retains special provisions for
immigrants from neighboring countries and allocates around 30
percent of its visas to family members and around 10 percent to
humanitarian arrivals.
In neither Australia nor Canada has the emphasis on skills
and education been sufficient to deal with labor demand in
unskilled categories. Canada still, at this point, is importing
around 90,000 temporary workers per year in mostly unskilled
work. At the same time, the nation is estimated to house an
illegal population in the neighborhood of 200,000 people. In my
view, provisions that favor the entry of skilled and educated
workers constitute a valuable component of a balanced
immigration policy. But care must be taken not to over-sell
their virtues.
Skilled immigration is not a substitute for national
investment in human capital nor does it always provide a
costless pathway to economic growth. A skill-based policy, by
itself, cannot accomplish everything an immigration policy
needs to do. For an addition to needs for skilled and educated
workers or needs for family reunification and humanitarian
relief, not to mention the need to accommodate population
movements stemming from broader processes of regional
integration, a fact that is clearly evident in North America.
Thank you.
[The prepared statement of Mr. Massey follows:]
Prepared Statement of Douglas S. Massey
There is nothing wrong with creating an immigration system that
takes into account and rewards the human capital characteristics of
immigrants. After all, as markets for goods, services, products,
information, and financial capital have globalized, so have markets for
human capital. Human capital refers to the skills, knowledge, and
abilities gained by people as a result of education and experience,
both formal and informal.
Indeed, the United States has such a system. The United States
currently reserves around 40 percent of its numerically limited visas
for workers judged to be priority in the Nation's economy; those with
professional credentials, needed skills, or special talents; and those
whose presence is deemed likely to create American jobs. However, the
share of employment-based migrants actually runs at around 20 percent
of total immigration because the United States does not attempt to
limit the entry of spouses, children, and parents of American citizens
who, by themselves, constitute something over 40 percent of the total.
Given the large size of the U.S. immigration system, even a total
percentage of around 20 percent means that we take in 150,000 to
200,000 skilled workers each year as permanent residents, and the
United States generally does quite well in attracting human capital
away from its competitors in the OECD. After all, it is the world's
largest and most dynamic economy and it has an unparalleled
infrastructure for investment, research, and innovation. It is no
wonder that we attract the lion's share of the world's skilled
immigrants.
In order to compete with the United States, smaller countries such
as Australia and Canada have created visa allocation systems that give
relatively greater weight to education, skills, and abilities than to
family connections in the allocation of immigrant visas. In recent
years, close to 40 percent of Australia's immigrants arrived in skilled
or professional categories, compared to around 55 percent of Canada's.
A skill-focused immigration system gives these countries some hope of
competing with the colossus in the world economy that is the United
States.
I would not advocate a similar emphasis on skilled immigration in
the United States, for several reasons. First and foremost--we don't
really need to. As already mentioned, the United States does very well
in the global market for human capital. In my home department at
Princeton University, for example, 30 percent of the faculty is foreign
born, more than double the rate in the Nation as a whole. Moreover, the
Bureau of Labor Statistics does not foresee any dire shortages of
skilled and educated workers looming in the foreseeable. Over the next
decade, the largest single category for job growth, at 33 percent, will
be health care service workers, an unskilled category that will become
increasingly important as the U.S. population ages. Although demand for
computer scientists, programmers, and mathematicians is also expected
to increase by 30 percent, in absolute terms the demand for health
service workers will be greater; and given the shift toward outsourcing
in high-tech fields, there are few complaints about shortages of
programmers and engineers. More common are complaints about the number
of jobs being shipped overseas than the number of immigrants arriving
to fill them here.
Moreover, to the extent that the United States has problems in
human capital formation--that is, the inculcation of skills and
education among its citizens--cherry picking talent from abroad is a
stopgap measure that doesn't solve the problem. In the long run, the
primary source of America's stock of skills, talents, and education
must come from investments made in its own human capital--by funding
the acquisition of education and training and the promotion of basic
and applied research at home. According to data from the National
Center for Educational Statistics, we spend only 3.8 percent of our GDP
on primary and secondary education, including both public and private
institutions, a level of educational funding that is well behind
competitors as Australia, Belgium, Denmark, France, Korea, New Zealand,
Norway, Portugal, Sweden, and Switzerland.
Not only is immigration a poor substitute for investments in the
education and training of Americans, it is much less reliable as a
source of human capital. Immigrants are, by definition, mobile, and
they can depart as easily as they arrive. Within Australia, for
example, in any given year, the arrival of immigrants is offset by a 25
percent rate of emigration by former immigrants; and of those who
depart a very disproportionate share, around 56 percent are
professionals. Indeed, in a recent analysis I did of newly arrived
immigrants to the United States, I found that relatively high levels of
dissatisfaction with life in the United States went up sharply as
education rose. Whereas one-third of all immigrants said they were
somewhat or very dissatisfied with the life in United States after 1
year in the country, the figure rose to more than two-thirds among
immigrants with advanced degrees. Those with the highest earnings were
least likely to want to naturalize to American citizenship.
In many ways, immigration is more difficult for those with
education, professional skills, and credentials. Admitting immigrants
simply because they possess skills without regard for whether and how
those skills might be used in the receiving countries can create more
problems than it solves. Although Canada admits more skilled immigrants
as a percentage of its total than any other country, it is hardly a
model of success. Unsuccessful integration by skilled immigrants is
common and is now recognized as a serious policy concern; and the
principal reason for failed integration is the inability of a household
breadwinner to gain meaningful employment in his or her chosen
profession or trade.
As a result of the gap between the number of skilled immigrants
arriving in Canada and the ability of the country to absorb them,
immigrants there have an exceedingly high rate of poverty. According to
data from Statistics Canada, 36 percent of immigrants who arrived in
the prior 5 years earn poverty level wages, a percentage that rises to
45 percent among migrants from East Asia and 51 percent among
immigrants from South Asia. The high rate of poverty and the dashed
hopes that it implies help to explain growing resentment and rising
attraction to radical Islam in Canada's Muslim community. In Canada, 41
percent of the children of immigrants live in poverty, compared with 18
percent of native children. By way of comparison, the rate of poverty
among immigrants in the United States is just 18 percent, compared with
11 percent among natives.
Not only does a policy weighted disproportionately toward the
skilled and educated not suffice as human capital development policy,
it doesn't make sense as immigration policy. Immigration policies
balance many competing issues, only one of which is skills and
education for input into the economy. Although nations such as
Australia may emphasize skills to compete with the United States, that
country still retains special provisions for entry from neighboring
nations such as New Zealand and it continues to admit 28 percent of
immigrants in family categories and 10 percent in humanitarian
categories. Even in Canada, 25 percent of immigrants enter as family
members, 11 percent as refugees, and 9 percent in other categories.
In neither of these countries, moreover, has the emphasis on skills
and education in the system of legal admission been sufficient to deal
with labor demand in less skilled categories. Canada, for example,
imports some 90,000 temporary workers each in largely unskilled
categories such as agricultural laborers and private household workers,
and the nation currently houses an illegal population estimated to be
in the neighborhood of 200,000. Australia's undocumented population is
estimated to be on the order of 50,000. Although these numbers may seem
small by American standards, they pertain to much smaller countries.
In summary, provisions that favor the entry of skilled and educated
workers constitute a valuable component of a balanced immigration
policy, but care must be taken not to over-sell their virtues. Skilled
immigration is not a substitute for national investment in human
capital through education, training, and research, nor does the simple
importation of more skilled and educated workers provide an easy
pathway to national development, as Canada's experience increasingly
shows. Finally, a skills-based policy cannot by itself accomplish
everything an immigration policy needs to do, as even Australia and
Canada have realized. In addition to needs for skilled and educated
workers are needs for family reunification and humanitarian relief, not
to mention the need to accommodate population movements stemming from
broader processes of regional economic integration, a fact nowhere more
obvious than within the zone covered by the North American Free Trade
Agreement.
Senator Sessions. Thank you, Mr. Massey. Mr. Tonelson,
we're glad to have you.
STATEMENT OF ALAN TONELSON, RESEARCH FELLOW, U.W. BUSINESS AND
INDUSTRY COUNCIL EDUCATIONAL FORUM
Mr. Tonelson. Thank you very much, Senator Sessions and I
am very grateful for the opportunity to testify today on behalf
of the U.S. Business and Industry Council and its 1,500 member
companies on skills-based point systems.
Since 1933, USDIC has been representing family-owned
companies, mainly small- and medium-sized manufacturers and it
is one business organization that is deeply concerned about the
deterioration of U.S. immigration policies for the past 20
years and of special relevance to our hearing today, we are
very worried about the overwhelming economic irrationality of
current U.S. immigration policy. Frankly, we feel that
strengthening the American economy in ways that lift incomes
for native born Americans should be the top priority of U.S.
immigration policy.
Now, there is no doubt that skilled-based point systems or
approaches like them, in principle, can help restore much of
that needed rationality to American immigration policy and yet,
such mechanisms need to be constructed and used with great
care. In particular, labor markets are highly dynamic and even
volatile systems and the stream of data that they emit does not
necessarily reveal the most important trends and developments
that shape these markets over the long-term. As a result, this
constant stream of data, of short-term data in particular, is
all too capable of sending public policy down very counter-
productive tracks, leading to efforts to second-guess economic
and business dynamics best worked often, in fact most often,
best left to work themselves out. Still, the broad goal of
somehow linking immigration policy to our economy's major
economic needs makes a great deal of sense. And again, these
various point systems represent serious efforts to turn this
insight into public policy.
At the same time, we do need to think long and hard before
adopting systems like this and we should pay special attention
to the pitfalls of trying to fine-tune labor markets. What are
some of these? Well, first, in a genuine market-dominated
economy--and ours certainly qualifies, the very idea of a
chronic labor shortage, much less a chronic labor shortage that
the government should try to somehow mitigate, is deeply
controversial and it should be viewed very skeptically, not
only by economic theorists but by policymakers. After all, if
we really do believe in free markets, we therefore believe that
the supply of anything, including human sweat and human talent,
is a function of the price offered to that labor. The converse
is obviously also true. So a mismatch between labor supply and
labor demand must not automatically be interpreted as a
problematic shortage, especially in the real world, which is
what we're all trying to work with, after all, even the most
efficient markets will often take some time to adjust fully to
changing conditions. There are always lags and there always
will be lags.
Thus, what is often called a labor shortage nowadays is
often simply an instance of the businesses failing to pay wages
high enough to attract the workers they say they need. Why
should government address this particular situation through
immigration policy at all? Moreover, longer lasting labor
shortages, in theory and also historically, have been
precursors to highly desirable economic change. One example--
our country has always been a labor-short country relatively
speaking. That is, of course, the main reason why for much of
U.S.'s history, we have been relatively open to immigrants. Yet
the enduring scarcity of labor has also produced major
advantages and specifically, it has helped to generate a great
deal of technological progress and productivity gains. An
economic theory provides a very convincing explanation why.
When businesses determine that the price of scarce labor has
become excessive, powerful incentives emerge to substitute
capital and technology for labor. That means innovation.
Preventing labor shortages in, for example, high-tech
industries but throughout the American economy, carries a great
risk of weakening this proven spur to technological progress. I
don't think we want to do that. Sectors of the American economy
claiming or actually experiencing genuine labor shortages may
be sending yet another market signal that we should not ignore,
that their businesses or sectors are simply not viable. Many of
the loudest and most persistent claims of labor shortages and
of the need, frankly, for eased control on immigration, come
from, for example, the service sector of the American economy,
especially industries like hospitality, entertainment, cleaning
services and building management. These industries also argue
that they can't raise wages easily because their margins are
often very slim and often, they have a very good point. They
would also argue with some justification that they can't easily
mechanize or digitize. Yet assisting them with greater
immigration inflows could overlook and worse, reward, a failure
to innovate managerially and to increase efficiency and
productivity, for example, by re-organizing their physical
operating arrangements or simplifying administration procedures
or simply motivating their workers more effectively through
nonwage incentives. In other words, companies or entire sectors
that are heavily dependent on rock-bottom wages for
profitability and even survival may not be sectors or companies
that deserve to survive. Their confessed inability to make
money by raising prices at all constitutes powerful evidence
that their product or service is simply not wanted very much.
Why should governments seek to overturn the market's verdict in
those instances? So we eat out less or we wind up paying more
for meals at restaurants? What's the problem? Let's trust the
market to adjust constructively in the long-term to situations
like this.
A third reason to be careful about using immigration policy
to stabilize labor markets stems from the inherent complexity
of the signals provided by wage and broader compensation
levels. The most important complexity is that although stagnant
or declining compensation almost always represents conclusive
evidence of a labor surplus, rising compensation is not always
conclusive evidence of a short- or long-term labor shortage,
especially one that can or should be remedied through
immigration policy because rising compensation can often
reflect circumstances having nothing to do with longer term
economic fundamentals. For example, very strong backing for the
proposition about falling wages comes from recent trends in
sectors of the American economy that we know use illegal
immigrant workers especially heavily. The National Restaurant
Association, for example, recently told the press that their
sector will need nearly 2 million workers in the near future
but, ``doesn't know where they will come from.'' Yet data from
the U.S. Bureau of Labor Statistics shows, unmistakably, that
inflation-
adjusted wages for the broad food services and drinking
establishments category fell 1.65 percent between 2000 and
2005. The hotel industry makes very similar claims and yet,
according to BLS data, real wages in that sector fell by nearly
1 percent between 2000 and 2005. Even in the U.S. construction
industry, which has been servicing recently, the greatest
housing and real estate boom in human history--nothing less--
inflation-adjusted wages fell 1.59 percent between 2000 and
2005 and similar figures can be found for every other industry
that heavily used illegal immigrant labor.
If employers in sectors like this are genuinely clamoring
and competing for more workers and are desperate for them and
don't know where in the world they will actually get them, how
could real wages fall? How could these businesses possibly hope
to attract the workers they need by making the jobs that they
are struggling to fill less attractive? How could that be?
Now, at the same time, I said wage increases don't
necessarily signal labor shortages. How could that be? Well,
one key reason is, long-term labor contracts and especially
union contracts, can provide for compensation increases even
when companies run into trouble and ones who actually reduce
labor costs. Rising compensation can also stem from mistakes in
managing other areas of U.S. public policy. For example, the
U.S. news media is filled with articles about alleged shortages
of skilled manufacturing workers but why would opening doors to
large numbers of immigrant workers be the very best answer for
the long-term interests of the U.S. economy or of native-born
workers, which once again, they should be the main priority of
U.S. immigration policy.
Senator Sessions. Mr. Tonelson, if you could wrap up, we'll
make your full remarks a part of the record. I find them very
valuable.
Mr. Tonelson. I'm sorry for that. I would stress in closing
that no attempt to restore rationality to U.S. immigration
policy can possibly work without enforcement, without effective
monitoring and effective enforcement and that means real money
and real personnel and it means time to put these entirely new
systems into effect. And I'll close with that.
[The prepared statement of Mr. Tonelson follows:]
Prepared Statement of Alan Tonelson
Good morning, Mr. Chairman, Mr. Ranking Minority Member, and
members of the committee. I am very grateful for the opportunity to
testify today on behalf of the U.S. Business and Industry Council and
its 1,500 member companies on using a skills-based point system to help
implement an employment-based immigration policy.
USBIC, which since 1933 has been representing family-owned
companies--mainly small and medium-sized manufacturers--has been deeply
concerned about U.S. immigration policy for the last two decades. We
have watched with dismay how U.S. policy during this period has
regressed into a de facto Open Borders stance that is endangering our
national security and undermining wages and benefits throughout the
labor force.
Shifting America's immigration policy from one focusing tightly on
family unification to one focused on serving the Nation's long-term
economic interests in principle would be a most welcome step. Skills-
based point systems like those used in countries such as Canada and
Australia have the potential to help achieve this objective.
At the same time, such mechanisms need to be constructed and used
with great care. In particular, labor markets are highly dynamic--even
volatile--systems. The stream of data that they constantly emit does
not necessarily reveal the most important trends and developments that
shape these markets over the long run. In fact, the endless barrage of
short-term numbers can conceal or obscure these more enduring
underlying trends. As a result, they are all too capable of sending
public policy down counterproductive tracks. And they could easily
place policymakers in the risky position of trying to second-guess
economic and business dynamics best left to work themselves out. That
is to say, the short-term employment figures should not be confused
with reliable data about genuine economic fundamentals.
The broad goal of somehow linking immigration policy to the
economy's major needs makes good sense. The advantages of awarding
preferences of some kind to immigration applicants likely to be
productive and innovative instead of applicants likely to be economic
dead weights (at least for the foreseeable future) should be obvious.
In addition, immigration policy should try to take the economy's
performance into account as well. If the entire economy is booming on a
sustainable basis, relatively higher inflows would seem advisable. If
the economy is mired in a lengthy downturn, reducing immigration levels
arguably would preserve more jobs for citizens who are workers--the
worker group deserving of first priority in U.S. immigration policy--
and for non-citizens residing in the United States legally.
Governments can also reasonably hope to gear immigration policy
toward long-term trends affecting more specific sectors of the economy.
An immigration policy favoring manual typewriter repairers clearly
deserves less support than one favoring computer network architects.
The point systems in place in Canada, Australia, and New Zealand
represent serious efforts to turn these insights into policy. Although
Canada's point system assigns less weight to its economy's specific
occupational needs, it still attempts to match newcomers with
particular industries. In its skilled worker program, it places a
premium on highly specialized skills ranging from butcher to welder to
Ph.D. mathematician, and even assigns these different skills varying
weights. Australia goes so far as to publish an ``Occupations in
Demand'' list every 6 months that is based on comprehensive labor
market research, including consultations with individual employers and
business groups. New Zealand awards bonuses for applicants in sectors
identified as ``growth areas,'' ``future growth areas,'' or areas of
``absolute skills shortage.''
U.S. policymakers, however, should think long and hard before
turning such programs into the core of a new U.S. immigration policy.
They should pay special attention to the pitfalls of trying to fine
tune labor markets.
First, in a genuine market-dominated economy, the very idea of a
chronic labor shortage--much less a chronic shortage that the
government should try to mitigate--is deeply controversial. It should
be viewed skeptically not only by theorists, but by policymakers. After
all, if we believe in free markets, we believe that the supply of
anything--including human labor and talent--is a function of the price
offered to that labor. The converse is true as well. So a mismatch
between labor supply and labor demand must not automatically be
interpreted as a problematic shortage--especially since in the real
world, even the most efficient markets will often take some time to
adjust fully to changing conditions.
Thus, what is characterized as a labor shortage nowadays is often
simply an instance of employers failing to pay wages high enough to
attract the workers they say they need. Why should government address
this situation through immigration policy at all?
Indeed, this uncertainty reflects the second reason to be careful
about fine-tuning labor markets. Longer-lasting labor shortages in
theory and historically have been precursors to highly desirable
economic change.
For example, the United States has always been a labor-short
country. That's of course a main reason we have been so open to
immigration for so much of our history. Yet the enduring scarcity of
labor also has produced major advantages for our country. Specifically,
it has generated much of the technological progress and many of the
productivity gains we have achieved.
Economic theory provides a very convincing explanation why. When
businesses conclude that the price of scarce labor has become
excessive, powerful incentives emerge for them to substitute capital
and technology for labor. And that means innovation. Our country owes
much of its longstanding world leadership in most technology areas to
this genuinely chronic scarcity and thus relatively high price of
labor. Preventing shortages with immigration policy could weaken this
proven spur to technological progress and all the benefits it brings.
Sectors of the economy claiming or actually experiencing genuine
labor shortages may be sending another market signal that we ignore at
our peril--that their businesses are not viable, and thus don't deserve
to survive, at least not in their present form. Many of the loudest,
most persistent claims of labor shortages--and of the need for eased
immigration controls--come from the service sector of the American
economy, especially industries such as hospitality, entertainment,
cleaning services, and building management. These industries also argue
that they can't raise wages easily because their margins typically are
so slim. Often they have a point. They also argue, with some
justification, that they cannot easily automate or mechanize or
digitize.
Yet assisting them with greater immigration flows could amount to
overlooking vitally important economic realities. It could overlook--
and reward--a failure to innovate managerially, to increase efficiency
and productivity by reorganizing physical operating arrangements, or
simplifying administrative procedures, or simply motivating employees
more effectively through non-wage incentives.
In other words, companies--or entire sectors of the economy--
heavily dependent on rock-bottom wages for their profitability and even
survival may not be companies or sectors deserving to survive. Their
confessed inability to make money by raising prices constitutes
powerful evidence that their product or service simply is not in great
demand. Why should government seek to overturn the market's verdict in
such instances?
A third reason to be careful about using immigration policy to
stabilize labor markets stems from the inherent complexity of the
signals provided by wage and broader compensation levels. Compensation
is of course powerfully influenced by the supply of labor in a given
market at a given time, but the relationship is hardly mechanical. The
most important complexity is that, although stagnant or declining
compensation almost always represent conclusive evidence of a labor
surplus, rising compensation is not always similarly conclusive
evidence of a short- or long-term labor shortage--especially one that
can or should be remedied through immigration. For rising compensation
can often reflect circumstances having nothing to do with economic
fundamentals.
Support for the proposition about falling wages comes from recent
trends in sectors of the economy that use illegal immigrant labor
heavily. The National Restaurant Association, for example, recently
told the press that this industry will need nearly 2 million workers in
the near future but ``doesn't know where they will come from.'' Yet
data from the U.S. Bureau of Labor Statistics shows that inflation-
adjusted wages for the broad Food Services and Drinking Establishments
industry fell 1.65 percent between 2000 and 2005.
The hotel industry has made similar claims. Yet according to BLS
data, real-wages in this sector fell by nearly 1 percent from 2000 to
2005. Even in the construction industry, which in recent years has been
servicing the great housing and real estate boom in world history,
inflation-adjusted wages fell 1.59 percent between 2000 and 2005.
Similar figures can be found for other illegal immigrant-heavy service
sectors, such as dry cleaning and laundry services, parking facilities,
golf courses and country clubs, as well as food manufacturing.
If employers in these sectors have truly been clamoring and
competing for more workers, how could real wages have fallen? How could
employers have hoped to attract the workers they need by making the
jobs they are struggling to fill less attractive? But more than simple
common sense points to the existence of labor gluts in these sectors
during this period. Wages in most illegal immigrant-heavy sectors of
the economy followed a common pattern in the first 5 years of this
decade. Until about 2002 or 2003, real wages in these industries
actually tended to rise a bit. Yet soon after, they dropped
significantly. Obviously, employers in these sectors decided that their
labor costs had grown excessive, and in response stepped up efforts to
bring Mexican and Central American labor markets and standards into the
United States.
Why, however, don't wage increases similarly signal labor
shortages. One key reason: Long-term labor contracts, and especially
union contracts, can provide for pay and benefits increases even when
companies run into trouble, and may well want to cut labor costs. These
contracts can also set floors that for political reasons can be
exceedingly difficult to breach. Rising compensation can also stem from
errors in managing other areas of public policy.
For example, the media is filled with articles about alleged
shortages of skilled manufacturing workers. A case in point is an
August 15 Wall Street Journal article about the scarcity of welders.
For two decades, the Journal reported, ``welding, a dirty and dangerous
job, has fallen out of favor'' in the United States. Yet with
industrial production recovering several years ago and remaining
strong, wages and benefits are skyrocketing, and manufacturers now
ostensibly are at their wit's end. Nor, apparently, is outsourcing the
work to low-wage countries like China the answer in every situation--
yet.
But would opening the doors to large numbers of immigrant welders
be the best answer for the long-term interests of the U.S. economy, or
of native-born workers? That seems unlikely, since a major root cause
of the shortage arguably would remain unaddressed. It is entirely
possible that the welder and broader skilled manufacturing worker
shortages stem not from the ``dirty and dangerous'' nature of the work,
but from the steep decline in manufacturing employment--and future
employment opportunities--and still-depressed output levels in many
non-electrical machinery industries in particular that have
characterized the U.S. economy recently.
Wittingly or not, American policymakers have sent the native-born
labor force a clear message: that maintaining manufacturing employment
opportunities is simply not valued in Washington. With no evidence that
this official indifference to manufacturing employment will change
anytime soon, why would any prospective welder in his right mind
actually have started down such a career path in the last decade or
two? Who could blame young Americans for shunning such occupations?
From the standpoint of promoting the creation of high-wage job
opportunities for native-born Americans--which, again, must be the U.S.
government's top immigration and labor policy priority--the best
solutions to this labor shortage would be measures to create confidence
that manufacturing production employment in America has a solid long-
term future. This means major adjustments in various regulatory and tax
policies, and in our international trade policies.
The final reason to be cautious about implementing Canadian- or
Australian-style point systems concerns problems that could result from
the focus on skilled workers. As suggested earlier, an immigration
policy placing a premium on highly skilled and educated immigration
applicants can in principal create significant benefits for the
American economy. Nonetheless, the risks that exist in principal--and
that show signs of real-world effects--must not be overlooked.
As is well known, the United States has had something like such a
policy in place in the form of its various visa programs designed for
employers needing special skills ostensibly not available in sufficient
amounts in the native-born labor force. In sectors such as information
technology services, however, an impressive body of evidence shows that
the ease with which these programs can be implemented poorly, and their
enforcement requirements neglected, is depressing wages in these
knowledge-intensive areas.
Turning high-wage jobs into much lower-wage jobs may serve the
short-term interests of U.S.-owned and located technology companies.
But this growing trend is having dangerous consequences for the
foundations of America's technology leadership. For it looks to be
discouraging many of the best and brightest young Americans from
pursuing science and technology careers. The education and skill
premiums previously enjoyed by such workers are shrinking steadily.
Given the long and often expensive years of schooling generally
required to gain world-class information technology expertise, young
people quite understandably seem to be shying away from degree programs
in the most relevant academic disciplines. These trends, of course,
threaten not only our Nation's future pool of the scientists and
engineers available for private industry. They threaten our future pool
of potential researchers--those scientists we need to ensure a
continuing series of breakthrough discoveries.
Unless one supposes that the native-born pool of potential high
tech workers can or should be largely replaced by a supply of immigrant
high tech workers, the possible problems created by a focus on skills
should become clear.
Some relatively broad and relatively narrow policy recommendations
might help Washington maximize the benefits and minimize the risks of
point systems. In general, the bias in these systems should be toward
generic education levels and skill endowments, not toward more specific
occupational experience or qualifications. In this sense, Canada's
recently revised system points the way, placing more emphasis on
attributes that will help immigrants adapt readily to the rapid rate of
contemporary economic change. In the process, this program adds to the
entire country's economic flexibility.
Because genuine labor market fundamentals are so difficult to
identify, responsibility for spotting them and recommending changes in
immigration policy could be awarded to an independent Federal
commission containing representatives from the worlds of labor and
academe as well as business. Still, the commission's charter should
include a significant bias against efforts to micro-manage labor
markets. An unmistakable burden of proof should be placed on
recommendations to intervene.
Alternatively, if a smaller government role is desired, Washington
could authorize companies and industries to certify the existence of
chronic labor shortages easable only through higher immigration flows.
Yet because employers and their organizations have made so many false
claims of such shortages in the past, heavy penalties--including
possibly criminal penalties--should attach for abuses of this system.
This committee's interest in bringing economic rationality to
American immigration policy is most encouraging. As the Chairman and
the committee members continue to examine this option, I hope they will
stay mindful of both the potential pluses and minuses of different
reform proposals. I also hope they will not forget that, all else
equal, it is entirely possible that the most economically rational
policy will entail the lightest degree of intervention in labor
markets. Thank you again for your interest in these thoughts. I and the
U.S. Business and Industry Council look forward to working with the
committee to improve our immigration policies.
Senator Sessions. Thank you. Well, I recall the article you
wrote on what you demonstrated, from the Department of Labor
statistics, that the areas that did have the greatest amount of
labor had shown, really a negative wage over the last number of
years, so it did sort of allow the argument that those
industries are desperately trying to hire people and they can't
hire them.
Mr. Massey talked about the difficulties of integration,
Mr. Beach that Canada had seen in some of the immigrants who
had come there. I had discussed that with a Canadian official
recently and he raised that point as a basis for further
tweaking of their point system, to get a higher level of
integration and economic success. Maybe I'd ask you to comment
on that and also would ask you to express an opinion on who
integrates best, the more-skilled and educated worker or the
less-skilled worker?
Mr. Beach. Thank you very much, Senator. It is quite true,
the figures that Professor Massey cited. In fact, I have the
study in which they come from. Now, on the one hand, they may
convey a bit more negative view than one might think, because
the figures he was citing for was for immigrants as a whole
rather than for those who come in under the point system and
presumably would assimilate faster or just faster----
Senator Sessions. In other words, that would include people
that come in without a skill-based set.
Mr. Beach. That's exactly right, Senator Sessions and in
general, the latter adjust much more slowly and integrate much
more slowly than those who do come in under the point system.
Senator Sessions. That would then sort of settle that
question, I mean, right there, would it not? That those in
Canada coming in under the skill-based systems are integrating
better than those who don't?
Mr. Beach. Well, certainly it settles that. That evidence
is quite conclusive but Professor Massey does raise the
troubling question that while they integrate faster than
nonindependent immigrants, the fact is, the speed of their
adjustment or assimilation has been declining over the last 20
years and also corresponding to that is the rate of the working
poor who are immigrants, has been rising. It is significantly
higher than that of the working poor who are not immigrants and
that is quite worrisome. I could give you----
Senator Sessions. Now, the policy was changed in 2002. Have
you been able to ascertain any trends since then and that
policy, as I understood it--correct me if I'm wrong--was
designed to create a better assimilation and success of
immigrants.
Mr. Beach. Yes.
Senator Sessions. It was focused on--I think you indicated
general skills that would allow you to be--increased
productivity, the move between jobs rather than just a specific
skill and a specific job.
Mr. Beach. That's exactly right. And when you have a
country where people are thinly spread across a long distance,
having some flexibility to adjust is quite important. We don't
have evidence yet to be able to answer the question as to what
the effects are. I view the 2001-2002 changes as essentially
tweaking or refining the more fundamental changes that were
brought in during the middle nineties but really shifted from a
focus on the point system on gap-filling to one that looked at
these broader range of skills. Because the evidence is
conclusive that those with a range of broad skills do
assimilate better.
Part of the question that you raised and Professor Massey's
figures refer to, is as I mentioned, the rate of adjustment of
immigrants, including independent class immigrants, has been
worsening over the last 20 years and there is quite a question
as to why that is occurring. Some of the reasons have to do
with the immigration system or the point system and some are
other things as well. I don't know if you want a short form or
a long form. There are a lot of things like that.
Senator Sessions. Maybe we better let the other panel--if
you thought there was something you'd like to share with us, if
you would do that for the record, we would appreciate it.
Mr. Beach. Or I can certainly do that and also, if there
are written questions, I can elaborate on that at that time.
Senator Sessions. On the success rate or assimilation rate,
Professor Borjas, you've written about it also, I guess. What
are your thoughts on that general discussion that we've just
reached?
Mr. Borjas. My study of the Canadian data and my reading of
the literature seems to indicate pretty clearly that highly
skilled immigrants in Canada coming in through the point
system, do a lot better in the end and assimilate faster than
the immigrants who don't come in through the point system. One
important thing to notice in terms of the increasing poverty
among immigrants in Canada is that, note, Canada has a very
large immigrant influx of high-skilled workers. It is also
inevitable that that large a number of high-skilled immigrants
is going to effect the high-skilled labor market. In fact,
there is recent evidence indicating that the high skill wage in
Canada has actually declined by 5, 6 percentage points over the
last 20 years because of that.
I'm sure that part of the reason that over time, the high-
skilled immigrants coming in to Canada doing slightly worse is
because they, themselves are being affected by themselves. You
know, there are just so many of them that the high-skill labor
market in Canada has really been distorted quite substantially
over the last two decades.
Senator Sessions. That's an interesting insight. I think
about my cotton farmers. They know if there is a big year of
cotton and there is a lot of cotton on the market, the price
tends to go down. If there is a shortage, the price tends to go
up. Mr. Tonelson, would you briefly comment on that and I'll
let Mr. Massey wrap that--any thoughts he had at the
conclusion.
Mr. Tonelson. I would just say that it is worth considering
that even if high-skilled Canadian immigrants are having more
and more problems and doing less and less well, that's
certainly not an argument for putting a premium on skills or on
knowledge because clearly, low-skilled, low-knowledge people
will be doing even worse and in fact, if you think about it one
step further, assuming that like in this Nation, most of the
low-skilled people go into the service industries, their major
customers are higher income Canadians. If they are becoming
lower and lower and if their incomes keep on falling, then the
demand for those very services will fall also and everyone will
be worse off then. But certainly, the low-skilled will suffer
the most.
Senator Sessions. Mr. Borjas, on that subject. Mr. Tonelson
has written on it a little bit.
No, I'll leave that and go to Mr. Massey and let you wrap
up on this subject because we have a number of others to talk
about.
Mr. Massey. The main point that I wanted to make was that
simply putting in a point system that kind of rewards people
for having certain skills, abilities and so on, doesn't solve
all your problems. Sometimes it can create problems. So, kind
of emphasizing--too much of an emphasis on skills and
education, the immigration system can also create problems for
people as Canada is experiencing now. As George points out,
they've saturated, in some sense, the high end of their labor
market and pushed down some of the wages. At the same time, the
process of bringing in and incorporating skilled immigrants
from other countries has proved more difficult than people had
expected. There are credentials issues, there are licensing
issues and then there are also issues of discrimination in the
labor market that they have to face now.
Senator Sessions. I'm just a tremendous fan of President
Bush but he has used the phrase and maybe I'm taking it a
little out of context, a willing worker and a willing employer,
and implying essentially that's all that it takes. That's the
only issue that you need to decide there.
Well, Dr. Borjas, would you agree, I think, with Mr.
Tonelson, that that is an invitation to employers to not
increase wages and could actually pull down the wages of low-
skilled American workers and I think you've written on that.
Mr. Borjas. If I were an employer, I would basically be
laughing all the way to the bank after listening to President
Bush saying that, simply for the following reason. I mean, just
take it to an extreme. What is to prevent an employer who wants
to make a lot of money from just lowering the wage of almost
every job to say, $5.15 an hour, the Federal minimum wage,
knowing full well that there is a world out there of people who
are more than willing to come to the United States to work for
that wage, which is far higher than the opportunity available
to them in the source countries. So that is just an invitation
for a huge number of workers coming in working for very low
wages and the employer will able to basically fill almost every
job available at that wage.
Senator Sessions. You'd written a book and the title of it
is, Heaven's Door. You, yourself, are an immigrant to our
country and we're glad you brought your talents and skills
here. Would you share for us what you meant by the words,
Heaven's Door?
Mr. Borjas. What I meant by Heaven's Door was that after I
had written the book--okay, this actually was the last thing I
wrote about the book, the title. After I had written the book,
I began to reflect on what this country meant to me. I mean,
when we came to this country, we basically were kicked out of
Cuba with nothing and I remember very clearly my family sort of
dreaming about being able to live in a country where one had
freedom and opportunity and they wanted me out of Cuba, no
matter what, even if they couldn't have the freedom and the
opportunity, they wanted me to have it. And that's really what
I meant by that. I mean, the country is really like a beacon.
The old myth is correct. This country, to people abroad--to
many people abroad is really a beacon of freedom and
opportunity. We have a great responsibility here to make sure
that continues to provide that beacon for future generations.
Senator Sessions. And you, I believe, make reference to the
fact that from an economic perspective, virtually any third-
world person, of what coming to the United States means for
them economically, anywhere in the world, virtually.
Mr. Borjas. In terms of coming to the United States. It
just means that life of incredible wealth--imagine most places
in the world. It means a life of a steady job, of not having to
worry about where your next meal is coming from, in many cases,
of being able to work a 40-50 hour week, of being able to take
vacations, of being able to have leisure, being able to--
especially for the children, of being able to make sure that
even if you don't quite make it in this generation, your
children will have a pretty good opportunity of ending up quite
well in their life. So I think that is really the crucial
beacon of economic and----
Senator Sessions. And that's the basis for the fact that
more would seek to come here than you believe would be wise or
that we could rationally accept.
Mr. Borjas. Just think about the lottery, okay? I mean, I
looked at the numbers. I'm teaching a class right now on
immigration and I looked at the numbers very recently on the
lottery applications. We more or less raffle out 50,000 visas a
year, actually slightly less than that. In the last lottery
round, over 5 million people applied.
Senator Sessions. You're kidding! Five million?
Mr. Borjas. No, 5 million people applied--5 million people
applied for 50,000 slots. Now the probability of winning the
lottery is far lower than getting into Harvard, for example.
It's just an unbelievable price that people value that at and
the number of applications to the lottery actually indicates
that. If you go back in time a little bit, before 9/11, the
last lottery before 9/11 attracted 11 million applications for
50,000 slots. So that just tells you the excess demand
available out there for entry into the United States and that's
why I stressed in my discussion that even if we were to switch
to a highly skilled immigration policy, the number of people
who want to come to this country is way, way greater than what
we would be willing to admit to be able to maintain economic
stability in this country.
Senator Sessions. Well, I think that is so basic. I won't
ask you to say it. I'll say it, in my view, on the bill that we
passed in the Senate that got a majority of the votes, gave no
thought to these issues. We've never discussed them, as we set
the policy before. Now, Mr. Massey, I think you had written
about--I don't know where, I had it here--an article in June
2005 for CATO, entitled, ``Backfire at the Border,'' and you
advocated an elimination of the family preference, not for
wives and children but for brothers and sisters. Is that
correct? And isn't that, in a way, saying that we ought to have
some other selection criteria for this large number that want
to come and pick who comes, other than just being a sibling?
Just maybe your thoughts on that.
Mr. Massey. It's all a matter of emphasis in the
immigration system and I do think that the family side has
received somewhat more emphasis than it needs. In this day and
age, I think if you decide to become an immigrant and come to
the United States, you are not breaking contact with your
brothers and sisters. You can go back and visit them. They can
come visit you. It's not a hardship like perhaps it once was.
The brother and sister provision of immigration law is the
single most important factor for the immigration chaining--that
is, the creation of networks that bring more migrants. So if
you eliminate that provision, I don't think you'll impose due
family hardship on immigrants and you'll also eliminate the
single most important factor in immigration law, that promotes
the proliferation of networks that actually bring more people
into the United States. So it was my effort to come to a more
balanced assessment. Not that I oppose family immigration. I
think it is only right and proper that spouses be allowed to
support their spouse in coming and bringing their children and
perhaps even their parents. But brothers and sisters, I don't
see as a terrible hardship in this day and age and it promotes
the chaining of migration, it actually fuels the networks that
produce more.
Senator Sessions. It gets us further away, I think, from a
merit-based system. I think about--I'd share the Mexican-
American enter problem, entering for a couple of years. We had
a great conference in Pueblo, Mexico that just strikes my mind.
I think about a young person there that was valedictorian of
his class, took 3 years of English, has no family members in
the United States and applies to enter, Professor Borjas, and
he is competing against a person who happens to be the--who is
a high school drop-out. He speaks no English but has a brother
in the United States. Isn't that the current policy and could
we make it better?
Mr. Borjas. Well, just think about another way. Look at
actually the key--I mean, it effects the quarter on how many
siblings can enter the United States in any given year and the
quarter is by country. So in some countries, a quarter--the
law, the queue is actually unbelievably long. I may not have
the exact dates right now but I'm pretty close to the exact
date. I believe that as of right now, if your Filipino brother
living in the United States sponsors your entry, your number
will come up, if you apply in 1980 through 1984. So there is
like a 20-, 22-year queue already from the Philippines. Even in
Mexico, I think that the queue is like 10 or 15 years long. So
again, that is actually an important thing to discuss when one
looks at the fairness of having an amnesty program, whatever
you want to call it, regarding how to treat the illegal
immigrants now living in the United States with people who
applied 10, 15, 20 years ago and are still waiting in line. It
is really the sibling provision that creates a lot of those
problems.
Senator Sessions. I couldn't agree more. Just sharing some
thoughts with you, Senator Specter and I have traveled in South
America and the Dominican Republic recently and we noticed an
article about a poll in Nicaragua that said 60 percent of the
people of Nicaragua would come to the United States if they
could. I thought the number would be high but that was
stunning. I shared that with, I believe, the ambassador or one
of his staff in Peru and they said they had done a poll earlier
this year that said 70 percent would come if they could. I
think about, well--if you can't accept everybody, let's try to
create a rationale system. Let me do this question here.
Under our current immigration laws, 80 to 90 percent of
people who come legally come here solely based on family
relations or a humanitarian purpose. That's a pretty large
number and in the Dominican Republic, the Consultant Office who
approves the visas said that virtually everybody there comes on
a family connection. They have fraudulent marriages sometimes
but whatever it is, it is mainly family connection. In fiscal
year 2005, a total of 1.1 million aliens became lawful,
permanent residents with Green Cards. Almost 60 percent were
family sponsored. Forty-four percent were diversity lottery
immigrants, 16 percent were humanitarian immigrants and about
20 percent were employment-based. So this means that 80 percent
of the immigrant inflow for the United States has no skill set
requirement.
Consider the fact that the family members of an employment-
based immigrants come in under the employment-based category,
not the family category and that number, with no skill-set
evaluation, really is closer to 90 percent. It just makes sense
and you've written about it, Mr. Borjas. I don't want you to
repeat too much but would you comment on that and your thoughts
about it?
Mr. Borjas. Let me put it in context. I think the question
would really make sense to have that kind of immigration
policy. It really goes back to the question I discussed in my
talk, which is, what do we want to accomplish with immigration?
Who do we want to help out from it? If we want immigration to
be as an anti-poverty program for people all over the world,
then what we are doing is probably just fine because we're
creating opportunities to many, many people who would otherwise
never have that kind of opportunity. But at the same time, that
kind of goal implies a cost to people over here. I mean, most
particularly, the price and cost to taxpayers and it implies a
cost to low-skilled workers who already live in the United
States, including the immigrants themselves, because they do
compete in the labor market. So one has to sort of balance
those different objectives. There is a humanitarian aspect to
all this that one should not forget. But at the same time,
having an immigration policy that distorts the low-skill labor
market so much and that increases the potential for many more
people to enter the public assistance system, the welfare State
and perhaps for a very long time. That really cannot be in the
self-interests of this country in the long run and that is why,
in my book, I sort of try to argue that if one were to focus on
economic issues alone, one could make a pretty good case that
what we are doing now is not really the best thing we should be
doing. We can do better than that.
Senator Sessions. Australia, amazingly, we met with the
Australian officials, just private conversation and they
explained their program. They don't admit any low-skilled
workers. They take only high-skilled and brings in other
characteristics. They have humanitarian, they have a lot of
things and family but when it comes down to workers, they focus
on a higher scale. Are you familiar with that, Mr. Tonelson?
Mr. Tonelson. Not very.
Senator Sessions. I think about--I guess I'd think about my
votes. I'm going to have to take maybe about a 7-minute break
to vote and come back. But I'm thinking about--I'll put it in a
personal term. I met on the mall a few weeks ago--I was taking
a walk on Saturday morning in Alabama and an African-American
spoke to me and we chatted. He had his family out. He said that
they were visiting a relative. I asked him how things were
doing and he said, ``Fine.'' He was in the concrete finishing
business. His father had been in the business. I said, ``How is
it going?'' and he said, ``Not good.'' I knew Montgomery where
he was from, that the economy is booming and I just threw out,
I said, ``Do you think immigration would have something to do
with that?'' He said, ``yes,'' he did and he thought immigrants
were decent people and fine and great. He had no objection but
he did think it was impacting him. I even think about people at
the food service places. If there is a shortage, normally you
would expect their asset--if we buy gold and it goes up, we
expect to sell it for a higher price--their asset, their labor
is not being allowed to be driven up by market forces because
we're bringing in what could be an unlimited supply of labor.
Is that a correct analysis?
Mr. Tonelson. That seems to be all too clear from the most
authoritative source of wage data that we have. Now, you could
say, ``Well, it's not just wages.'' There are all other forms
of compensation but most of these low-paying service jobs do
not carry great health plans and great pension plans at all. In
fact, even in higher wage sectors, you see benefits and
pensions being pared back dramatically if not eliminated. So,
it just doesn't stand to reason that if a certain company is
desperate for workers, that it is offering lower and lower
wages, that it is making these jobs less attractive to hold
rather than more attractive to hold. Now, this may mean that we
really don't know anything about economics. Maybe everything
that we learned in college and Economics 101 is wrong. But I
don't think that's so.
Senator Sessions. Let me take this vote right now. It won't
take me but a few minutes to vote. It's a cloture vote and if
you don't mind, I'd like to come back and pursue this a little
more, if we could. Thank you. We'll be right back.
[Recess.]
Senator Sessions. Thank you for staying. Professor Beach,
how does Canada handle seasonal work in industries like
agriculture and I'll just add, when Senator Specter and I were
in South America, in Colombia, President Uribe told us that
they had a very successful seasonal work program with Canada, I
think, in Spain and I was told that the Dominican Republic
also, when we were there, had a very successful program and
they said, ``What is the problem? People go to Canada and come
back. We don't understand.'' And so, would you share with us
how Canada does that and is it distinct from its citizenship
track?
Mr. Beach. Sure, thank you. I'm not a specialist on the
temporary work program, which this comes under but it is my
understanding that these seasonal workers--essentially
agricultural, in the agricultural area, in Southern Ontario and
British Columbia--come in under a program for temporary visa
workers. Now, the exact details of how that functions, I'm not
sure. Presumably, they apply, there is some sort of application
process and a decision is made to admit a certain number. It is
for temporary workers, so they can't just come do their work
and stay. They have to go back and that does seem to work
reasonably well. Now, it is my understanding that almost all of
them come from Central America and Mexico, so I'm not at all
surprised with what you saw down there.
Senator Sessions. The number I had, I believe we got from
Canadian officials, was that they have about a 98 to 99 percent
compliance rate, is that consistent with what you----
Mr. Beach. That would be my sense, that's right. Because if
there starts to be abuses of that system, that would be picked
up quite quickly by the media because statistics are open and
there would be a lot of debate and you can certainly expect
that they would start making some major changes on that, yes.
Senator Sessions. And Professor Beach, I recently found
that continuation of the 2002-2003 migration program in
Australia--I don't know if you are familiar with it but I'll
ask you and I'll ask the others, a recent study found that in
Australia, that program will deliver an increase in living
standards of $852 per person by 2021. This is a gain due, they
say, to the skills stream that they utilize. The study suggests
that the gain is equivalent to the effect of a $21 billion tax
cut and dwarfs the projected gain of under $200 per person from
the policy reforms of eliminating existing import tariffs on
motor vehicles, clothes and footwear. The analysis by Access
Economics demonstrates that continuing the 2004-2005 migration
program in Australia is expected to deliver a net benefit in
excess of $4 billion for 4 years. Are you familiar with that
study?
Mr. Beach. I'm not familiar with that study. I'm also
pretty sure that a study like that has not been done for
Canada, otherwise I would have heard about it.
Senator Sessions. I was told by the Australian officials
here recently, from the Embassy who deals with immigration
issues that they felt the way they were working it, it was an
economic benefit to them all.
Mr. Beach. Yes. They have, in some ways, a stricter policy
toward high-skilled workers than Canada does so it wouldn't
surprise me that they could get some quite strong results. But
one can certainly do that kind of calculation for Canada. In
fact, Professor Borjas is the one who developed the technique
to do that sort of thing.
Senator Sessions. Either one of you care to comment on that
study.
Mr. Tonelson. Well not so much on that particular study but
it seems to me that Professor Massey was right when he said
that the real issue we face is an issue of balance and that's
often what public policymakers deal with. You've got many very
legitimate competing interests. How do you balance them all
into the most effective way? But that also means that you have
to ask yourself, what are our priorities? We can have many
valid goals for American immigration policy but we need
priorities and it seems to me--it stands to reason that the No.
1 priority is strengthening the American economy and helping to
raise the incomes of U.S. workers, of native-born workers and
legal residents. That may not command universal assent but I
think you'd have a hard time finding any American leader who
would explicitly disagree with that and I think that it has
also been quite well established, certainly at this hearing,
that U.S. immigration policy does not attach a high enough
priority to those economic goals and that it does attach too
high a priority to noneconomic goals like family reunification.
Senator Sessions. In April 2006, ``Time'' did a cover story
on the Nation's high school dropout rate. According to the
article, high school dropouts are, ``relegated to the most
punishing sector of the economy where low wage jobs are
increasingly filled by even lower wage immigrants.'' If this is
true, I think it is a problem for us and I believe that is
true. So Mr. Tonelson, I'm not sure you are aware, I know Dr.
Borjas is, maybe Dr. Massey is, that in 1997, the National
Research Council, which is part of the National Academy of
Sciences told us that a high school drop-out costs the United
States $89,000 more in social services than they pay in taxes
over the course of their lifetime. It does not matter if that
high school dropout was born in the United States or immigrated
to the United States. Robert Rector from the Heritage
Foundation tells us that the number is closer to $100,000 due
to inflation. That was a number of years ago. He also tells me
that in the last 20 years, the United States has imported
through legal and illegal immigration, 11 million high school
dropouts. If the $100,000 figure is true, these persons would
cost the U.S. Treasury $1 trillion more in their lifetime than
they will pay in. Now, that is--I don't know if those numbers
are precisely correct but I think there is truth in those
numbers. Would either of you want to comment on that?
Mr. Massey. One more point that I would make and that data
is certainly consistent with everything that we know about the
relationship between wages and incomes on the one hand and
skill and knowledge levels on the other hand. This kind of
immigration policy also enormously feeds our Nation's appetite
for public services, including entitlements and especially as
this wage deterioration creeps up the--in fact, not even
creeps. That's the wrong word--proceeds very steadily up the
entire income ladder, more and more of even the U.S. middle
class again becomes dependent upon entitlements to the degree
that we never have before. Now, clearly, there is a real
problem with inflation in health care and things of that nature
but also, it is equally clear that the earnings--the wages and
earnings of most working people have not nearly capped off and
in fact, we know that there has been wage stagnation in this
Nation for the median worker for 30 or 35 years now. That's
never happened before in U.S. history.
Senator Sessions. Well, just to put in an exclusive term,
let's think about a beef packing plant. If you were a native
and worked in the beef packing plant and you had no
immigration, you'd be a very valuable commodity to the meat
packing plant, is that correct?
Mr. Tonelson. Absolutely.
Senator Sessions. It would be glory days for you
economically.
Mr. Tonelson. Exactly and it would probably raise the cost
of meat unless the meat producers figure out a way to increase
productivity and that's how we make progress. That's a major
governing----
Senator Sessions. But it wouldn't double the price of beef.
Mr. Tonelson. Not right away, I'm sure.
Senator Sessions. No, I don't think so either.
Mr. Massey.
Mr. Massey. I'm very familiar with 1997 and our report. I'm
actually a member of the National Academy of Sciences and there
have been a number of changes that have occurred. Congress, as
you know, passed in 1996 both the Immigration Welfare Reform
Acts and that really kind of changed the calculus for a lot of
immigration and what we've seen since 1996, are rising rates of
tax payment by immigrants and falling rates of service
utilization by immigrants, across all categories. This is true
of both documented and undocumented migrants. They are less
likely to use and more likely to pay. So I don't think the
figures are as stark as they were calculated to be in 1997.
Senator Sessions. The Congressional Budget Office, at my
request--and truly, they only had a matter of days--I asked
them to evaluate the fiscal costs to the U.S. Treasury right
before we voted on the immigration bill, which amazingly,
nobody had asked for. They came back, showing on the first 10
years, a slight gain to the Treasury, which I frankly had some
doubt about. The proponents of the legislation waved that
around. They admitted, however, that the second 10 years would
be much worse because the Green Card, the permanent resident
status, was pushed out after some of the amendments, to about
Year Ten. So that's when you get the earned income tax credit
and qualify for Medicaid, Medicare and other things. Now
they've redone that and they've said that there will not be any
gain in the first few--and this is talking about welfare, food
stamps, all of that as compared with what they pay in taxes.
Say it could be as high as $126 billion deficit and admittedly
much higher in the next 10 years. Robert Rector estimates after
that first 10 or 11 years, it would run about as high as $50
billion a year, half a trillion dollars over 10, based on the
policies set forth in the bill that we passed in the Senate.
But it appears not to be moving forward. So that's the latest,
best numbers we've got on the impact on the U.S. Treasury. Do
you have any comments on that, Mr. Beach, if you're familiar
with it?
Mr. Beach. Not on the U.S. situation but in Canada, the
fiscal effects of immigration are expected, particularly in the
long run, to be very strongly positive because if you bring in
people, particularly if they are young and hardworking and they
have good skills, initially they may have some difficulties
settling in but then once they do, they earn a good income and
pay taxes. They make below-average use of social security
services, this sort of thing, so they are less a drag on the
expenditure side and they bring in considerably more money on
the revenue side. Also, if you are bringing in younger people
rather than older people, that means they have a longer time to
contribute to things like the Canada pension plan and so on. So
when they retire, they are less a drag on the system. In fact,
they've contributed through their taxes, supporting people like
me.
Senator Sessions. Right.
Mr. Beach. We have several studies on that so the evidence
is fairly clear-cut there, yes.
Senator Sessions. I'm sorry Dr. Borjas is not here, but,
Mr. Rector--he says it is a fiscal disaster and anybody that
says that the current process of immigration will strengthen
things like Medicare and Social Security are living in a dream
world. He was basically very critical of that analysis mainly
because he points out that of the people here illegally, 60
percent are not high school graduates and so, they are unlikely
to have a wage sufficient to cause them to pay any income taxes
and they certainly--so it is a real dilemma and there are no
easy answers. It is interesting that I hear you say that Canada
believes that it will be a net fiscal plus and Australia told
me that also.
Mr. Beach. Yes. Part of what is going on, the difference in
results between Canada and the United States is that we have
very few illegal immigrants and so the figures I was giving you
were simply for the legal immigrants. Again, in the United
States, you have this large number of illegal immigrants and
that could, indeed, cause quite different calculations and
results.
Mr. Tonelson. I think that something else we have to
recognize about the results in the United States in recent
years, we have to ask ourselves what was the American economy
like in the late 1990s? What is it like now? I think it is very
clear that much of the growth, the strong growth that we had in
the late 1990s was due to a stock market bubble, a technology
bubble, that generated levels of economic activity--of output
for products for which there were no markets and for which
there were not going to be markets for years and years and
years and that, of course, didn't last. What has happened to
the U.S. economy since 9/11? Unprecedented stimulus poured in
to buoy economic activity artificially. And we still have not
come close to the growth rates that we achieved back in the
1960s, let's say, with much less U.S. Government stimulus. We
have essentially been pulling rabbits out of our hats and
clearly, that's benefited all Americans in the short run but if
you think, as I do, we're running out of rabbits, you'll be
worried about this and it is very hard to imagine that going
forward, folks with low skills and poor schooling will not be
net drags on the American economy.
Senator Sessions. Mr. Massey, do you want to wrap this
thing up?
Mr. Massey. Well, if you look at America's age structure,
we're rapidly aging, if you just look at the native population
and there is going to be a progressive mismatch between the
demography of the workforce that we'll require and the
demography of the people, the native population. You really see
this--the largest projected category for growth is health
service workers, which is an unskilled category. That is
supposed to grow 33 percent in the next 10 years and that is
going to continue to grow at a rapid rate because of the
population aging even more after that. So I think that is not
whether we are going to take in relatively unskilled workers or
not, it is really how many and under what terms. I don't think
that we have the optimal situation right now. Personally, I
would favor some kind of guest worker program because I've been
working in Latin America for 25 years and been collecting data
continuously in Mexico since 1982. The typical Mexican migrant,
when they leave for the United States, 70 percent say they may
want to come but that doesn't mean they want to stay. They are
culturally Mexican and the typical migrant, when they leave, is
not leaving because he is abjectly poor, has no prospects, no
possibility of survival in Mexico. He is leaving because he has
got a mobility project. He wants to finance the construction of
his house because there aren't good mortgage markets in Mexico.
He wants to pay for the education of his kids. He wants to
acquire capital to found a business in Mexico, in the absence
of good credit markets. So they migrate to the United States.
If you created a mechanism for them to do this, they would work
and they would return.
Senator Sessions. Could I be frank--there was a part of a
bill, they called it ``temporary guest worker program'' and
that is what people kept saying, is a temporary guest worker
program but when we read the print on it, what it said was,
people would come in under that program. They could bring their
families. They could stay for 3 years. They could extend for 3
years, 3 or 4--how many times? Twelve? And then after the
second extension, they could apply for a Green Card and then on
the route to citizenship. So there was really nothing temporary
about it but I think about what President Uribe told me, how
happy they were in Colombia. Their people could fly apparently
to Canada and work 8 months and come back home. They don't take
their family and they make a good bit of money and they can
build that house and fix it up and educate their children. Is
that more of your understanding? Now, one of the bill sponsors
said, Well, I don't like that. I think that's creating a
second-class citizen.'' Not a citizen, we're creating a class
separated from our traditions or something to that effect. But
to me, a program would allow you to come, a certain number,
depending on what the labor studies show, for so many months
without a family, with the option to return back and forth
during that time, if you're able, would be something I could
probably support. Would you opine on that?
Mr. Tonelson. I think a program like that would handle a
huge share of Mexican migrants right now. Now, it's true--the
old joke, there is nothing as permanent as a temporary worker
program. Always, there is going to be some fraction that
settles out and the goal of public policy should not be to
prevent people from settling out period but to minimize the
fraction. If you make it easier for people to go back and give
them incentives to go back, you are simply reinforcing their
natural inclination. The natural inclination is not to move
here permanently but to use the U.S. labor market
instrumentally on a couple of visits, to improve their lives at
home. The ironic effect of really sealing the border is that
you don't prevent people from coming in so much but you really
discourage them from going home because it is so difficult to
get in, they are afraid they won't be able to get back in if
they need to, in the future, so they just hunker down and stay.
And we've actually, over the past 20 years, radically depressed
the rate of return migration among undocumented migrants. So
the big buildup that document migrants to the United States
hasn't come from an increase in the rate of in-migration--that
has been fairly stable for 20 years--it has really come from a
rapid fall-off in the rate of out-migration, which dates to our
militarization of the border starting in 1993.
Senator Sessions. Let me go to Mr. Beach now.
Mr. Beach. Just to followup a bit on your comment on the
temporary workers, where they could come in, say 3 years plus 3
years. I think one might want to think about that perhaps a bit
more. It is my understanding that programs like that have been
used in Europe for some years and they are behind a bit of some
of the problems they've had. If workers are going to be here
for say, 3 years, they may marry, settle down, raise families.
Then after 6 years, what is going to happen? They may well be,
in some sense, second-class citizens. They feel that badly. The
kids may not have access to the kind of schooling, whatever it
is, their health care.
Senator Sessions. Um hmm. Now, that's why----
Mr. Beach. I think that can----
Senator Sessions. That was the criticism of one of our--the
sponsor said, in effect--I think he mentioned Europe. We don't
want to create that kind of system but in Europe, it is an
extended right to work plus a right to extend that again and
again, right?
Mr. Beach. That's right. But it is also my understanding
that the rights of such workers are certainly not those of
citizens.
Senator Sessions. Right. And they are there with their
family, they are there decades and they have no prospect of
moving to citizenship. That is a situation I would not favor.
Mr. Tonelson.
Mr. Tonelson. I found Professor Massey's comments on the
motivations for Mexican immigration to be a little bit unusual
in light of what we've seen during the very significant street
protests. We saw all around this Nation in the spring, where
what was the major theme? We not only want legalization, we
want citizenship, we want to vote and when we start to vote,
we're going to vote in such ways that wind up punishing any
politician who has been on the restrictionist side. And that's
not really--it's not consistent with the notion that most of
them don't want to stay.
Senator Sessions. I think there is a lot of truth, though,
Dr. Massey, in what you say but maybe you will respond to that.
Mr. Massey. Well, I imagine I talk to a lot more migrants
than you do.
Mr. Tonelson. Well, you probably do. But boy, I've heard a
lot of that.
Mr. Massey. Well, what you heard is a lot of public
clamoring filtered through the press and that's not an accurate
portrayal of the typical migrant and the people out
demonstrating are probably not an average cross section of
migrants. A lot of those are native-born Mexican Americans.
Senator Sessions. Well, could I just go back to this
question, because there is something that I have suggested and
I'm not sure it has registered. If we had the kind of program
that Canada has, my view is that you probably should not come
for more than 10 months at a time, you would not bring your
family but you would be able to return and go get an
identification card however many times you choose during that
10 months and could therefore help us with some of the seasonal
industries that we have. It's hard to get an American to
operate a cotton gin if they are only going to do it for 3
months of the year. I mean, they'd rather work at Wal-Mart at
less hourly pay as it's permanent, it's got benefits, that sort
of thing. So, there are some seasonal jobs there throughout
agriculture. Do you see any moral or legal or policy problems
with having that as one category, one aspect of an overall
immigration policy?
Mr. Massey.
Mr. Massey. No, not under the proper terms, as long as it
is not a brutally exploitive system that takes advantage of the
migrant workers. We ran such a program in the United States
from 1942 to 1964, known as the Bracero Program. In 1953-1954,
there was a crisis of illegal migration in the United States
and for the first time in U.S. history, there were a million
apprehensions of illegal Mexicans in the country and Congress
responded in two ways. One, they tightened up border
enforcement but the other thing it did, was it dramatically
expanded the Bracero Program, basically doubling its size,
basically going from about 150,000 a year to over 400,000 a
year for the whole period 1955 to 1960. During this period,
illegal migration fell from a million apprehensions in 1953-
1954 down to about 30,000 per year by 1959. So basically, it
was a two-pronged approach. They tightened enforcement at the
border but I really think the drop-off in undocumented
migration is because there was a legal channel for people to
move and at this point, legal settlement from Mexico was not
quantitatively limited so Braceros managed to acquire ties to
the United States and acquire a reason to stay here. They
became a foreman, for example, rather than a circular worker
and they managed the workers for a farmer. They could acquire
permanent resident status and settle down. It was actually a
fairly good system that, over the course of 22 years,
circulated in and out of the country around 5 million Mexican
workers and only resulted in the net settlement of several
hundred thousand.
Senator Sessions. Well, these are all very, very
interesting topics and I think you would all agree with me that
if we really redo our immigration policy, we should wrestle
with these issues and I, for one, am firmly convinced that
there are far more people who want to come here than we can
ever assimilate effectively. We know that and we need to
develop a policy that identifies those who have the more
meritorious claims for entry, who would be more likely to be
successful, who will more likely contribute more to the
government than they will take out from the government and just
be more successful. So I think that's the direction we need to
move in but I'm not sure my colleagues agree. I think the House
is just not focused on this issue. They have not discussed it.
They said we had to have credibility for the enforcement first.
Our basic plan was just to increase numbers and carry on the
existing programs. That's about all it does and has some
enforcement in it. But if we listen to people like you and we
do a humane, legitimate program, I think we can identify people
who want to come here and become citizens. I think there may be
a role for a temporary worker program and it would certainly be
helpful to our neighbor. That would be an easy move for them.
We could, with a little effort--I'm convinced we can do more
with the law enforcement than people think and literally, we
could create a policy that will work and that the American
people will be proud of. But we don't have that consensus now
and I'm hoping the information you've given us can help reach
that consensus.
If there is nothing else, we'll keep the record open for 10
days and if you have any further statements and any of the
members can submit questions at any time, we would appreciate
it if you would respond. Thank you very much for your
attendance and testimony.
Mr. Tonelson. Thank you, sir.
Senator Sessions. We are adjourned.
[Additional material follows.]
ADDITIONAL MATERIAL
publications of the law library of congress
Reports for Congress are produced by the Directorate of Legal
Research of the Law Library of Congress in response to requests from
Congress on issues concerning international, comparative, and foreign
law. The Directorate of Legal Research is a unique academy of expertise
whose faculty of foreign attorneys and research staff is dedicated to
providing world-class international, comparative, and foreign law
research, reference, and information services to the U.S. Congress. The
Directorate's full-time staff of foreign-trained attorneys from over 20
jurisdictions are led and supervised by two executive-level division
chiefs and assisted by a staff of multilingual legal research analysts.
The Directorate responds to Congressional research and reference
inquiries on the legal systems of all nations, past and present, on the
basis of the Law Library's global collection, the Global Legal
Information Network (GLIN, available at www.glin.gov), and other
electronic databases. During fiscal year 2005, our faculty of 20
foreign law specialists and 5 research analysts consulted over 37,000
sources and conducted in excess of 48,000 electronic searches as they
prepared 2,039 reports--some 5,900 pages of legal analysis and
reference assistance that covered over 160 jurisdictions. Directorate
responses are delivered in whatever format is best suited to the
requester and may be in the form of newly commissioned single
jurisdiction or multinational legal reports, previously prepared
studies, confidential memoranda, quick-answer oral consultations,
briefings in a Member's office, or expert witness testimony at
committee hearings.
We invite you to visit the Law Library Web site at www.loc.gov/law,
which details all of our services and provides access to the Global
Legal Information Network, a cooperative international database of
official texts of laws, regulations, and other complementary legal
sources of many foreign jurisdictions. We also invite you to visit our
Congress-only Web site at www.loc.gov/law/congress for other Law
Library products that are produced in response to recurring
congressional interest. An online monthly, the WORLD LAW BULLETIN, is
the Directorate's monthly flagship publication that provides the U.S.
Congress over 500 updates on foreign law developments annually. Updates
are chosen for their special significance to the U.S. Congress as they
relate to legislative interests or foreign policy. Foreign Law Briefs
cover topical legal issues and Country Law Studies provide overviews of
legal systems of individual nations. Congressional workload permitting,
the Law Library also serves the research needs of the other branches of
the U.S. Government and renders reference service in international,
comparative, and foreign law to the general public, including
international organizations, embassies, state governments, and the
professional legal, academic, and library communities.
The principal resources for all Law Library publications are its
collection and research staff. The Law Library's holdings of over 2.6
million volumes constitute the world's largest and most comprehensive
legal collection. Its staff of over 45 legal specialists, researchers,
and librarians--competent in more than 50 languages--can provide
research and reference information on all of the major legal systems of
the world, contemporary and historical.
For further information about the topic of this publication, the
Global Legal Information Network, or for making a research request on
international, comparative, or foreign law, please contact the Director
of Legal Research by e-mail at [email protected], or by fax at (202) 315-
3654. Research requests may also be directed to the Law Library's
Congress-only Hotline at (202) 707-2700, which is staffed whenever
either Chamber is in session.
Law Library of Congress
Immigration Points Systems for Skilled Workers
comparative summary
Executive Summary
While Australia, Canada, New Zealand, Singapore, and the United
Kingdom all issue different types of immigrant or work visas, they all
have a category for highly skilled workers. As the number of these
visas is generally limited, the five countries employ points systems
designed to attract persons who will best meet the countries' economic
needs. France issues skills and talents residency cards based on
similar criteria, without allocating points.
Australia, Canada, New Zealand, Singapore, and the United Kingdom
all issue immigrant, residence, or work visas to qualified refugees,
family members, and workers or independent applicants. Canada and the
United Kingdom have work permit programs for unskilled workers, while
Australia, New Zealand, and Singapore generally admit persons who
qualify as skilled workers. In all four cases, however, skilled workers
are assessed in accordance with a points system that has been designed
specifically for their class. In all four countries, the skilled worker
class is the largest immigrant or work permit class. In 2004, Canada
admitted 133,000 persons as skilled or independent workers. In 2005-
2006, a total of 97,500 were allocated to the general skilled worker
program. In 2005-2006, New Zealand approved almost 31,000 skilled
worker applications. In the United Kingdom, the skilled worker class
has recently been expanded to attract MBAs from designated renowned
schools.
In Canada, skilled workers must accumulate at least 67 points out
of a total of 100 to be eligible for admission as a permanent resident.
In descending order, the six weighted selection criteria are education,
French and English language skills, work experience, age, arranged
employment, and adaptability. Australia has a ``pass mark'' in the 110-
120 range and a ``pool mark'' in the 70-120 range for persons that may
be awarded migration visas not claimed by persons who have scored above
the pass mark. The selection criteria are age, work experience,
occupational demand, and English language ability. In New Zealand, the
selection point is revised every 2 weeks. The most recent selection
point was 140 points. Persons scoring between 100-140 points may apply
for residence permits not claimed by persons who have scored more than
140 points. The selection criteria are job opportunities, relevant work
experience, qualifications, age, and family relations.
In the United Kingdom the creation of the highly skilled migrant
program has been described as ``the most dramatic development in
commercial immigration law for the past 30 years and has made many of
the other commercial immigration categories effectively redundant.''
The highly skilled migrant program is operated on a points system with
a pass mark of 65 or more. Points are awarded for educational
qualifications, work experience, past earnings, achievements in the
applicant's field, achievements of the applicant's partner, and age. In
2005, the government created a new program for persons holding an MBA
from one of the top 50 business schools designated by the Treasury.
This program is designed to attract highly qualified and talented
managers to the U.K.
Singapore employs a points system for the issuance of ``S Passes.''
These passes are issued for skilled technicians and middle-level
managers with a monthly salary above SGD$1,800. The selection criteria
are salary, education, work experience, and job type. Singapore does
not publish detailed descriptions of its assessment process.
In Canada and New Zealand, applicants accepted as skilled workers
are offered permanent residence. In Australia and the United Kingdom,
accepted applicants are issued visas that can be renewed. After a
qualifying period, visa holders can apply for permanent residence.
France has recently created a program for the admission of skilled
workers that creates a new type of residency card. These skills and
talents residency cards are valid for 3 years and may generally be
renewed. However, concern that this program might otherwise result in
the permanent loss of persons with the most training and experience by
African countries has led the government to allow only one renewal of a
visa issued to a person from one of the scheduled African countries.
France does not employ a point system in issuing skills and talents
residency cards but considers many of the same factors scored in
Australia, Canada, New Zealand, Singapore, and the United Kingdom.
(Prepared by Stephen F. Clarke, Senior Foreign Law Specialist, July
2006.)
Law Library of Congress
australia
immigration points system for skilled workers
Executive Summary
Australia maintains an immigration points system for selection of
independent skilled migrants, Australian sponsored skilled migrants,
and State specific/regional sponsored skilled migrants. The objective
of the skilled migrant visas is to enhance Australia's economy by
allowing skilled people access into Australia's workforce. Skilled
migrants must meet minimum health, character, language and age criteria
and are then awarded ``points'' on the basis of age, occupation,
language skills, work experience, qualification and sponsorship.
I. Current Immigration Law
In general all non-citizens require a valid visa to enter
Australia.\1\ The Commonwealth of Australia (Australia) has a migration
program that permits persons to migrate to Australia, or, if currently
living within Australia, to obtain ``permanent residence.'' The
Department of Immigration and Multicultural Affairs administers
Australia's migration programs.\2\ The principal pieces of legislation
are the Migration Act 1958 (Cth) and the Migration Regulations 1994
(Cth); Ministerial Directions (made under Migration Act Sec. 499) and
Government Gazette Notices, however, may also be applicable.
---------------------------------------------------------------------------
\1\ Migration Act 1958 (Cth) s42.
\2\ Department of Immigration and Multicultural Affairs,
www.immi.gov.au, (last visited July 12, 2006).
---------------------------------------------------------------------------
The Migration Regulations contain most of the specific details and
criteria for each visa. Visas are divided into classes and subclasses.
Schedule 1 of the Migration Regulations lists the visa classes and some
requirements for each class (such as procedures for visa applications,
time limits and review provisions). Schedule 2 of the Migration
Regulations details the specific requirements for each subclass.
Schedule 2 may refer to other schedules within the Migration
Regulations or to Government Gazettes that contain additional criteria.
Australia's migration program is divided into a ``Migration
Program'' and a ``Humanitarian Program.'' Both these programs are
divided into streams and categories of visas. Each visa has criteria
that are specific to that visa \3\; however, there are some ``general
public interest criteria'' relating to health and character that are
common to all visas.
---------------------------------------------------------------------------
\3\ Migration Act 1958 (Cth) s31(3).
---------------------------------------------------------------------------
II. Skilled Migration Numbers
In 2005-2006 a total of 97,500 places \4\ will be allocated to
skilled migration and 76,900 will be allocated to the general skilled
migration program.\5\ The allocation of visas across visa types (for
both primary and secondary visa applicants) is as follows \6\:
Skilled--Independent--49,200 places; Skilled--Australian Family
Sponsored--17,700 places; State Regional Sponsored (subclasses 495 &
137)--10,000 places.
---------------------------------------------------------------------------
\4\ The total expected migration program for 2005-2006 is 130,000-
140,000 places.
\5\ Birrell, Bob, Hawthorne, Lesleyanne, and Richardson, Sue
EVALUATION OF THE GENERAL SKILLED MIGRATION CATEGORIES, DIMIA, March
2006. p. 15.
\6\ Id. The total includes the primary applicant and any secondary
applicants (i.e., family members).
---------------------------------------------------------------------------
Skilled migrants may also be eligible for employer-sponsored visas
or business/investor visas.
III. Skilled Migration--Points System
In general, the skilled stream of Australia's Migration Program is
intended to enhance Australia's economy by allowing skilled people
access into Australia's workforce.\7\
---------------------------------------------------------------------------
\7\ In addition to skilled visas there are also visas available for
sponsored employees and for persons seeking to establish a business
within Australia.
---------------------------------------------------------------------------
There are 12 different general skilled migration visas. These may
be divided into: independent--requiring no sponsorship; Australian
sponsored--requiring sponsorship by an eligible Australian relative;
and, State/Territory specific visas that involve nomination or
sponsorship by an Australian state or territory. Three of these visas
are specific to overseas students who have completed Australian
qualifications. A description of these visas is provided in Attachment
1.
Most skill-based migration visas are assessed via a ``points''
system.\8\ Each visa has a ``pass mark,'' being the number of points
necessary to obtain a visa and a ``pool mark'' being the number of
points necessary to remain in a pool of applicants should there not be
sufficient pass level applicants or should the pass mark be revised.
Generally pass marks are 110-120 and pool marks range from 70-120.
---------------------------------------------------------------------------
\8\ Migration Act 1958 (Cth) ss92-96.
---------------------------------------------------------------------------
Under the ``points system,'' applicants, who must be between ages
18 and 45 and have English language skills, are credited with
``points'' primarily for qualifications (some visas require Australian
qualifications), age, work experience, English language ability, and
whether their occupation is in high demand. Additional points may be
awarded where the applicant has a well-qualified spouse, is providing
capital investment or has fluency in a community language. Attachment 2
provides an overview of the allocation of points under the points test
and current pass and pool marks.
(Prepared by Lisa White, Foreign Law Specialist, July 2006.)
Attachment 1
------------------------------------------------------------------------
Visa type Visa description
------------------------------------------------------------------------
Independent............................... Skilled--Independent
Does not require sponsorship (subclass 136) allows an
applicant with skills
required in the Australian
labor market to migrate to
Australia without the
requirement of employer
sponsorship. Applicable to
offshore applicants.
Skilled--Independent
Overseas Student (Subclass
880) is available for
overseas students under 45
years of age who have
completed an eligible
Australian qualification(s)
after at least 2 years full-
time study in Australia and
have an occupation on the
SOL list that is either a
60 point occupation or a 50
point occupation (if the
overseas student has
completed a Ph.D. in
Australia). This visa does
not have the threshold work
experience requirement of
the subclass 136 visa.
Applicable to onshore
applicants.
Australian sponsored...................... Skilled--Australian
Similar to Independent but additional Sponsored (subclass 138)
points may be claimed where the applicant allows an applicant to
is sponsored by an eligible relative and migrate to Australia when
pass mark is lower. they do not meet the
Applicants occupation must be on skilled criteria for Skilled
occupation list (SOL) and if their Independent (subclass 136)
sponsor is in Sydney and or other but they have an Australian
populated areas the applicant's relative who is willing and
occupation must be on the Sydney and able to sponsor them.
Selected Areas Skilled Shortage List Skilled--Australian
(SSASSL). Sponsored Overseas Student
(subclass 881) is available
for eligible overseas
students who have obtained
an Australian qualification
in Australia as a result of
at least 2 years full-time
study and have an
Australian relative who is
willing and able to sponsor
the applicant. The points
test for this visa is lower
than the Skilled
Independent Overseas
Student.
State specific and regional migration..... State or Territory Nominated
Independent (subclass 137)
allows participating state
// territory governments to
nominate skilled migration
applicants who are
interested in permanently
settling in states and
territories where their
skills are in demand. No
points test per se but
applicants must meet the
pool mark of 70 points.
Skilled--Independent
Regional (subclass 495)
allows an applicant who is
sponsored by an Australian
state or territory
government to remain in
Australia for up to 3 years
to live and work in a
regional or low-population
growth area. After living
in a regional or low
population growth
metropolitan area for 2
years and working for at
least 12 months in a
regional or low population
growth metropolitan area
applicants may apply for a
permanent visa. This visa
has a slightly lower pass
mark than the Independent
(subclass 136).
------------------------------------------------------------------------
In addition to the above visas there are visas specifically for New
Zealand citizens (Independent New Zealand Citizen subclass 861 and
Australian Sponsored New Zealand Citizen subclass 862). They operate
very similarly to the independent and sponsored visas described above
(with the same points test pass mark but no pool option) but are only
applicable to New Zealand citizens.
Attachment 2
Within the Australian ``points system'' points are allocated on the
following basis:
------------------------------------------------------------------------
Criteria Description Available points
------------------------------------------------------------------------
Age............................. There is a general 18-29yrs----------
criterion that ---------------30
the applicant is 30-34yrs----------
above 18 and ---------------25
below 45 years of 35-39yrs----------
age. Points are ---------------20
then allocated in 40-44yrs----------
relation to the ---------------15
age of the
applicant.
Occupation...................... An applicant must Degree or trade
nominate their qualification
occupation as one specific to the
that falls within occupation-------
the Skilled ---------------60
Occupation List General tertiary
(SOL). Points are qualifications
then awarded unrelated to
depending on the occupation-------
skill category of ---------------50
the applicant's General diploma or
occupation. advanced diploma
not related to
occupation-------
---------40
Occupation--MODL................ Applicant's Additionally
nominated applicant has job
occupation is on offer from
the Migration eligible
Occupations in organization-----
Demand List -------------20
(MODL) when Applicant does not
application is have a job offer--
assessed ----15
additional points
may be awarded.
English language skills......... The applicant must Competent---------
have at least ---------------20
vocational Vocational--------
English. If there ---------------15
is any doubt as Functional--------
to the ---------------Ni
applicant's level l
of English they
may be required
to take the
International
English Language
Testing System
(IELTS) test.
Specific work experience........ This is not an Applicant's
eligibility nominated
requirement but occupation is
is an optional worth 60 points
section in which and the applicant
the applicant may has worked in
be awarded points that (or a
for working in closely related
their nominated occupation) for 3
occupation. of the past 4
years prior to
making the
application------
---------------10
Applicant's
nominated
occupation is
worth 40, 50 or
60 points and the
applicant has
worked in any
occupation listed
on the SOL for 3
of the past 4
years prior to
making the
application------
-----5
Australian qualifications....... Additional points Doctorate of at
may be awarded if least 2 years
the applicant study------15
holds Australian Australian masters
qualifications or or honors (2:1)
has undertaken of at least 1
study towards year study--------
such ------------10
qualifications Two years study
where the towards degree,
instruction was diploma or trade
given in English qualification----
in Australia. -----------5
Regional area................... Additional points Two or more years
may be awarded if of study----------
the applicant has ----5
lived and studied
for
qualifications in
regional
Australian/low
population growth
metropolitan
area. That is,
not a capital
city or populated
area on the
eastern seaboard.
Spouse skills................... An applicant may Spouse skills------
be eligible for -----------------
additional points -5
if their spouse
is able to
satisfy basic
requirements of
age, English
language,
qualifications,
nominated
occupation and
recent work
experience.
Bonus points.................... An applicant may Capital
be eligible for investment-------
bonus points on -------------5
one the following Australian work
(ie. even if the experience
applicant is Community language
eligible for more
than one only one
may be claimed):
Capital investment
in Australia of
at least
AUD100,000 for at
least 12 months;
Australian work
experience in a
SOL occupation
for a period
// periods totaling
at least 6 months
in the preceding
48 months;
Fluency (ie.
professional
level language
skills) in a
community
language (that is
a language spoken
in Australia).
Relationship of sponsor......... Applicant or Only applicable to
applicant's Australia
spouse are sponsored visas
sponsored by an (subclasses 138,
Australian 881 & 862)--------
citizen, 15
Australian
permanent
resident or
eligible New
Zealand citizen.
Sponsor must be
related via non-
dependent child,
parent, sibling,
niece, nephew,
aunt or uncle.
State/territory sponsorship..... Applicant is Only applicable to
sponsored by Skilled--Independ
authorized state ent Regional
or territory (subclass 495)
government agency. visa----------10
------------------------------------------------------------------------
As of July 7, 2006 visa pass and pool marks are:
------------------------------------------------------------------------
Current Current
Category pass mark pool mark
------------------------------------------------------------------------
Skilled--Independent (subclass 136) visa.......... 120 70
Skilled--Independent Regional (subclass 495) visa. 110 110
Skilled--Australian Sponsored (subclass 138) visa. 110 105
Skilled--Independent Overseas Student (subclass 120 120
880) visa........................................
Skilled--Australian Sponsored Overseas Student 110 110
(subclass 881) visa..............................
Skilled--Onshore Independent New Zealand Citizen 120 120
(subclass 861) visa..............................
Skilled--Onshore Australian Sponsored New Zealand 110 110
Citizen (subclass 862)...........................
------------------------------------------------------------------------
Law Library of Congress
canada
immigration points system for skilled workers
Executive Summary
Canada accepts six major categories of immigrants: skilled or
independent workers, business immigrants, provincial nominees, family
class immigrants, international adoptions, and Quebec-sponsored
immigrants. Skilled workers are intended to comprise 60 percent of
migrants. Refugees are also counted in Canadian immigration statistics.
Preference systems are used either for determining eligibility for
admission in most of these non-refugee categories or in processing
applications. The most formal and detailed of the preference systems is
used for skilled or independent workers because they are assessed on a
points system. Preferences for family class immigrants are more
informal.
I. Immigration Categories
According to Citizenship and Immigration Canada's statistics,
approximately 236,000 persons were admitted to Canada for permanent
residence in 2004.\1\ Of those, 133,000 were admitted as skilled or
independent workers; 62,000 as family class immigrants; 10,000 as
business immigrants; 6,000 as provincial nominees; and 32,000 as
refugees.\2\ The totals have remained fairly constant over the past 10
years.
---------------------------------------------------------------------------
\1\ Citizenship and Immigration Canada, Facts and Figures 2004,
available at http://www.cic.gc.ca/english/pub/facts2004/overview
//1.html.
\2\ Id.
---------------------------------------------------------------------------
Canada does not have country-based or worldwide quotas, but it does
establish annual worldwide targets, and the actual numbers of
immigrants accepted for permanent residence within a year are usually
within 10 percent of those targets. Canada also does not provide that
immigrants in any one category can only exceed its annual target by a
certain percentage; there is, however, an understanding between
Parliament and Citizenship and Immigration Canada that in enacting the
current Immigration and Refugee Protection Act,\3\ Parliament intended
to create a system in which skilled or independent workers would
usually comprise about 60 percent of the annual total, and that skilled
or independent workers would normally outnumber family class immigrants
by a margin of approximately two to one. It is also understood that
Parliament expects Citizenship and Immigration Canada to exercise the
administrative powers conferred upon it in such a way as to preserve
the current balance, and that any significant fluctuations in either
direction would probably lead to legislative or administrative reforms.
Thus, in processing applications submitted at Canadian Embassies or
consulates, immigration officials attempt to adhere to the goals that
are set out annually by Citizenship and Immigration Canada in
consultation with the Government and appropriate parliamentary
committees.
---------------------------------------------------------------------------
\3\ 2001 S.C. ch. 27.
---------------------------------------------------------------------------
II. Skilled Workers
Canada's process for selecting skilled workers is fairly complex.
Prior to 2002, applicants were assessed on a point system that was
weighted so that in the vast majority of cases, applicants had to be
both suitable and have a job offer for a position that no Canadian
citizen was willing and able to fill. In enacting its new law,
Parliament adopted a slightly different philosophy. The current law
seeks to identify the types of persons who are most likely to integrate
into the Canadian workforce based upon their background. Less emphasis
is now placed on specific job offers, although this is still a
selection factor. The Canadian change of philosophy is based upon
findings that persons with certain educational and work backgrounds
generally become well integrated into Canadian society regardless of
whether they have a specific position waiting for them or not.
Under the current system, applicants must obtain at least 67 points
out of a total of 100 possible points on the selection grid \4\ and
have at least 1 year of work experience within the past 10 years in a
management occupation or in an occupation normally requiring university
or technical training set out in skill types identified in the National
Occupational Classification.\5\ The six selection criteria and the
maximum number of points available for each are as follows:
---------------------------------------------------------------------------
\4\ Canada's points system is set out in sections 75-83 of the
Immigration Regulations, SOR2002/227, as amended, available at http:/
//laws.justice.gc.ca/en/I-2.5/SOR-2002-227/index.html (last visited May
1, 2006).
\5\ Citizenship and Immigration Canada, Skilled Worker Self
Assessment, http://www.cic.gc.ca/english/skilled/assess/index.html
(last visited May 1, 2006).
---------------------------------------------------------------------------
1. education. A maximum of 25 points can be earned by a person who
has a Master's Degree or Ph.D. and at least 17 years of full-time or
full-time equivalent study. The lowest number of points awardable is
five for completion of high school;
2. languages. A maximum of 24 points can be awarded to persons who
are highly proficient in both official languages. Sixteen points can be
awarded for either French or English and eight for the other. Written
and oral tests are administered to ascertain a person's abilities in
different language areas;
3. experience. A maximum of 21 points can be awarded for experience
in the approved occupations. The law allows Citizenship and Immigration
Canada to designate certain professions as being restricted to guard
against labor surpluses. However, at the present time, there are no
professions that are designated being restricted;
4. age. A maximum of 10 points is awarded to persons who are
between 21 and 49. Persons outside this range lose two points for each
year that they are under 21 or over 49;
5. arranged employment. A person may be awarded 10 points for
having a permanent job offer that has been confirmed by Human Resources
and Skills Development Canada; and
6. adaptability. A person may be awarded additional points for a
spouse's education, previous work in Canada, study in Canada, arranged
employment, and family relations in Canada.
Each selection factor is broken down in charts that show how points
are awarded.\6\
---------------------------------------------------------------------------
\6\ Citizenship and Immigration Canada, Six Selection Factors and
Pass Mark, http://www.cic.gc.ca/english/skilled/qual-5.html (last
visited May 1, 2006).
---------------------------------------------------------------------------
III. Family Class Immigrants
Family class immigrants are not assessed on a points system, but
preferences are given to applicants based upon their relationship to
their sponsor. The administrative practice is to process applications
from spouses and dependent children the most quickly. Applications from
parents, grandparents, relatives who are orphans and under the age of
18, as well as children under guardianship, are generally given lower
preferences. Because family class preferences are based on
administrative practices rather than on legal requirements, they
generally are flexible.
Canada has a narrower definition of family class immigration than
does the United States. Applicants who do not fit into one of the above
categories still may be sponsored as skilled workers by a relative, but
they are assessed on the basis of the points system. Relatives who are
not considered to be family class immigrants may be awarded five points
towards the 67 points that they need in order to qualify for permanent
residence.
IV. Provincial Nominees
Most of Canada's provinces have programs designed to attract
skilled workers. Provincial nominees receive preference in the
processing of applications for immigrant visas. Because this category
is generally small, it is not broken down into various types of
provincial nominees.
V. Quebec-Sponsored Immigrants
An agreement between the governments of Canada and Quebec gives the
Province of Quebec responsibility for selecting skilled workers who
intend to settle in that province. These applicants are not assessed on
the Federal points system. Applicants selected by the province must
pass medical, security, and criminal backgrounds checks conducted by
the Federal Government. Once admitted to Canada, new residents are not
required to remain in a province that sponsored them. A major concern
of the Quebec Government is that many of the immigrants it has
sponsored in recent years have moved to Ontario.
VI. Business Immigrants
Canada admits three types of business immigrants: investors,
entrepreneurs, and self-employed persons. Because investors must have a
net worth of at least C$800,000 and must invest at least C$400,000 in
Canada, they enjoy the highest priority. Entrepreneurs are in the
middle category because they must have a net worth of at least
C$300,000. Self-employed persons have the lowest preference in this
category because they need only have the intent and ability to create
their own employment.\7\ Business immigrants are not assessed on the
points system.
---------------------------------------------------------------------------
\7\ Citizenship and Immigration Canada, Who Qualifies as a Business
Immigrant?, http://www.cic.gc.ca/english/business/ (last visited May 1,
2006).
---------------------------------------------------------------------------
VII. International Adoptions
The last group of applicants who are given preference for admission
to Canada is children who have been approved for international
adoption. Sponsors must prove that the adoption has been approved in
the child's country of birth. Adopted children are not assessed on the
basis of the points system.
VIII. Conclusion
Canada's immigration system is quite complex because it gives many
different types of preferences to persons in various categories as well
as to persons within most of the six basic categories. The largest
group of immigrants falls into the skilled worker class. Skilled
workers are assessed on a points system that places great emphasis on
education and work experience. The family class is narrower in Canada
than it is in the United States. Preferences within this class are
mostly administrative in nature. The third category that is broken down
into preferences is business immigrants. In those cases, persons who
are willing and able to invest at least C$400,000 in Canada are given
the highest preference.
(Prepared by Stephen F. Clarke Senior, Foreign Law Specialist, July
2006.)
Law Library of Congress
france
immigration policy for skilled workers
Executive Summary
France is implementing a new immigration policy designed to attract
the most qualified workers. They may apply for a skills and talents
residency card, which is valid for 3 years and is renewable. The
government, however, does not want this selected immigration policy to
result in a ``brain drain'' from the workers' countries of origin, in
particular, from African countries. Therefore, the card is limited to a
one-time renewal for nationals from selected countries, who must
participate during the card's validity period in a cooperative or
economic investment project as defined between France and their country
of origin.
I. Background
In January 2006, Interior Minister Nicolas Sarkozy outlined a new
policy on immigration.\1\ He called for a ``selected immigration
policy'' designed to bring the most qualified migrants to France,
noting that the current immigration policy was not linked enough to
France's economic needs. To head off concerns over the brain drain
which Africa, in particular, would suffer, if such a policy were
implemented, the Minister explained that there were means to ensure
that selected immigration be of mutual benefit to everyone. He stated
that \2\:
---------------------------------------------------------------------------
\1\ Voeux a la presse de Nicolas Sarkozy [Greetings to the press
from Interior Minister Nicolas Sarkozy], http://www.interieur.gouv.fr
//rubriques/c/cl le ministre/cl3 discours/2006 01 12 voeux presse (last
visited June 22, 2006).
\2\ Id.
In no way must this selected immigration policy result in a
brain drain from the countries of origin. Those whom we will
welcome will have to give back to their county of origin, in
some form or other, the benefits of the training and
professional experience they will gain in France. We will take
into account the needs of the country of origin when delivering
residency permits. This is a major difference from the policies
of some of our partners and I wish that France will take this
debate to European and international bodies. The development of
---------------------------------------------------------------------------
poor countries must remain a major objective.
His ministry prepared a draft law containing, among others,
measures facilitating the entry of skilled workers while ensuring, at
the same time, that workers of selected countries will stay involved in
the development of their countries of origin. The National Assembly
adopted the immigration draft law with minor changes on May 17, 2006,
while the Senate adopted a softer version on June 16. A commission met
to reconcile the two versions.\3\ Both chambers adopted the reconciled
version on June 30, 2006. Members of the parliamentary Socialist
groups, however, challenged the constitutionality of some of its
provisions. The provisions on entry of skilled workers, however, were
not part of the challenge. The Law has been sent to the Constitutional
Council for review. This Council examines the constitutionality of laws
before they are promulgated.
---------------------------------------------------------------------------
\3\ Assemblee Nationale, Draft Law on Immigration and Integration,
http://www.assemblee-nationale.fr/12/dossiers/immigration
integration.asp (last visited June 12, 2006).
---------------------------------------------------------------------------
II. Skills and Talents Residency Card
The Law creates a new type of residency card, the skills and
talents residency card. This card may be granted to ``a foreign
national capable of participating, by his skills and talents, in a
significant and lasting way, to the economic development or to the
prestige of France and the country whose nationality he/she holds,
notably in intellectual, cultural, humanitarian or sport domains.'' The
card is granted for 3 years. It is renewable; its renewal, however, is
limited to one time when the holder is a national of a member country
of the priority solidarity zone.\4\
---------------------------------------------------------------------------
\4\ Id. art. L.315-1.
---------------------------------------------------------------------------
The French government set forth a priority solidarity zone in 1998.
It comprises countries for which the government believes that
development assistance may produce a significant effect and contribute
to the sustainable development of the institutions, society and
economy. The latest list of countries was prepared in February 2002.\5\
The Law further provides that the skills and talents residency card may
only be granted to a national from a member country of the priority
solidarity zone where such country has a co-development agreement with
France or when the foreign national agrees to return to his country
after a maximum period of 6 years spent in France.\6\
---------------------------------------------------------------------------
\5\ The priority solidarity zone includes the following countries:
Near East--Lebanon, Palestinian Territories and Yemen; North Africa--
Algeria, morocco, Tunisia; Sub-Saharan Africa and the Indian Ocean--
South Africa, Angola, Benin, Burkina-Faso, Burundi, Cameroon, Cape
Verde, Central African Republic, Comoros, Congo, Cote d'Ivoire,
Djibouti, Eritrea, Ethiopia, Gabon, Ghana, Gambia, Guinea, Guinea-
Bissau, Equatorial Guinea, Kenya, Liberia, Madagascar, Mali,
Mauritania, Mozambique, Namibia, Niger, Nigeria, Uganda, Democratic
Republic of Congo, Rwanda, Sao-tome and Principe, Senegal, Sierra-
Leone, Sudan, Chad, Togo and Zimbabwe.
\6\ Assemblee Nationale, Draft Law on Immigration and Integration,
supra note 3, art. L.315-1-1.
---------------------------------------------------------------------------
The skills and talents residency card is granted based upon ``the
content and the nature of the foreign national's project and of its
interest for France and the country whose nationality she/he holds.''
\7\ A National Commission on Skills and Talents will set forth each
year criteria to be taken into account to evaluate the above
conditions.\8\ The Minister of Interior will issue the cards. The
foreign national who lawfully resides in France will file a request
with the competent local representative of the state while the foreign
national who resides outside France will present it to the competent
French consulate.\9\
---------------------------------------------------------------------------
\7\ Id. art. L.315-2.
\8\ Id.
\9\ Id.
---------------------------------------------------------------------------
The holder of a skills and talents residency card, who is a
national of one of the countries of the priority solidarity zone, must
participate during the validity period of his card in a cooperation or
economic investment project defined between France and his country.
Failure to respect this obligation will be considered when the card is
up for renewal.\10\
---------------------------------------------------------------------------
\10\ Id. art. L.315-3-1.
(Prepared by Nicole Atwill, Senior Foreign Law Specialist, July
2006.)
Law Library of Congress
new zealand
immigration points system for skilled workers
Executive Summary
New Zealand maintains an immigration points system for the
selection of independent skilled migrants. The objective of the skilled
migrant visa is to provide New Zealand residency to persons with the
transferable skills to fulfill identified needs within the New Zealand
economy.\1\ Skilled migrants must meet minimum criteria of age,
language skills, health and character and are then awarded ``points''
on the basis of qualifications, work experience, age, employment and
familial relations in New Zealand.
---------------------------------------------------------------------------
\1\ New Zealand Immigration Service Operational Manual Issued 24
April 2006 available at http://www.immigration.govt.nz/nzis
//operations_manual/index.htm. para.SM1
---------------------------------------------------------------------------
I. Current Immigration Law
New Zealand has a migration program that permits persons to migrate
to New Zealand, or if currently living within New Zealand, to obtain
permanent residence. Immigration New Zealand, part of the Department of
Labour, administers New Zealand's migration programs.\2\ The principal
pieces of legislation are the Immigration Act 1987 (NZ) and Immigration
Regulations 1999 (NZ). New Zealand is currently undertaking a review of
its immigration laws.\3\
---------------------------------------------------------------------------
\2\ See Immigration New Zealand's Web site, http://
www.immigration.govt.nz (last visited July 12, 2006).
\3\ See Department of Labour's Web site, http://www.dol.govt.nz
//actreview/ (last visited July 12, 2006).
---------------------------------------------------------------------------
New Zealand's permanent migration program has three ``streams'':
``Skilled/Business,'' ``Family Sponsored,'' and ``International
//Humanitarian.'' Under each stream there are a number of specific
categories. The purpose of New Zealand's Skilled/Business stream is to
``contribute to developing New Zealand's human capability base'' by
accessing global skills and knowledge and attracting people to
contribute to New Zealand's economy.\4\
---------------------------------------------------------------------------
\4\ See http://www.immigration.govt.nz/nzopportunities/live
//skilledmigrant.htm (last visited July 12, 2006) and New Zealand
Immigration Service, Guide for Working in New Zealand, NZIS 1016,
November 2005, p. 3.
---------------------------------------------------------------------------
A points system is used in the assessment of independent skilled
migrants within the Skilled/Business stream. Skilled migrants, however,
may also enter New Zealand under the Work to Residence policy as:
sponsored employees of either an accredited employer or a non-
accredited employer in an in-demand occupation; sponsored talent in
sports or the arts; or as investors/business persons.\5\ These
categories provide for applicants to obtain permanent residence either
immediately or after a specified period. Skilled migrants may also be
eligible for a temporary work visa, where: their skill in demand in New
Zealand; or the domestic labor market cannot fill a position; or they
are required to work in New Zealand for specific events or periods of
time.\6\
---------------------------------------------------------------------------
\5\ See Talent (Accredited Employers), Talent (Arts, Culture and
Sports); or Long Term Skill Shortage List visas. See New Zealand
Immigration Service, Guide for Working in New Zealand, NZIS 1016,
November 2005.
\6\ New Zealand Immigration Service, Guide for Working in New
Zealand, NZIS 1016, November 2005.
---------------------------------------------------------------------------
II. Skilled Migration Numbers
In 2005-06 New Zealand's skilled/business migration program
approved 11,703 applications resulting in 30,813 people. In addition,
26,286 people entered via the Skilled Migration (independent migration)
and 1,352 people via the General Skills and Work to Residence programs
(employer-sponsored migration).\7\
---------------------------------------------------------------------------
\7\ Immigration New Zealand statistics, http:/
//www.immigration.govt.nz/migrant/general/generalinformation/statistics/
(last visited July 12, 2006).
---------------------------------------------------------------------------
III. Skilled Migration--Points System
Under New Zealand's points system, applicants for the skilled
migration category must fulfill certain criteria (aged under 55 years,
be of good health and character and have a reasonable standard of
English) and score above a minimum points threshold before they may
submit an Expression of Interest (EOI) to live and work (residency) in
New Zealand.\8\ Attachment 1 provides an overview of the basis on which
points are issued.
---------------------------------------------------------------------------
\8\ Immigration New Zealand website, hthy./
//www.immigration.govt.nz/migrant/stream/work/workandlivepermanently
//howdoiapply/theprocess/default.htm (last visited July 12, 2006).
---------------------------------------------------------------------------
EOIs are ranked and those that meet the current Selection Point are
invited to apply for residency in New Zealand. The Selection Point is
the number above the minimum threshold above which EOIs will be
selected. It is determined fortnightly. Currently the Selection Point
is 140 points; therefore, applicants who score above 140 points will be
invited to apply for residency. If there are places remaining in New
Zealand's immigration program, those EOIs that score between 100 and
140 and have a New Zealand job or job offer may be invited to apply for
residency. If places are still available after the selection of those
with employment or offers of employment, then EOIs may be selected on
other criteria decided by the Minister for Immigration. Currently these
criteria place the EOIs into ranked categories (in descending order) on
number of points the applicants has for work experience in an area of
absolute skills shortage or qualifications in an area of absolute
skills shortage and then, within each category, the EOIs are placed in
descending order of their total points.\9\
---------------------------------------------------------------------------
\9\ Immigration New Zealand, Summary of Terms for Additional
Selection Criteria, http://glossary.immigration.govt.nz
//additionalselectioncriteria.htm (last visited July 12, 2006).
---------------------------------------------------------------------------
If an applicant's EOI is not selected, it will remain in the
``pool'' for 6 months before being deleted. If no EOIs are selected
from the pool in the previous 6 months then all applications will be
retained in the pool. Applicants whose EOIs are not selected may submit
another EOI.
Once applicants' EOIs are selected, they will be invited to apply
for residency (and thus be required to submit documents to support any
claims made in their EOI) and their EOI and application will be
assessed by the Department of Immigration against government policy and
to verify the information provided. From this assessment an application
may be declined or an applicant may be offered a permanent residence
visa or a temporary visa to enter and remain in New Zealand while
looking for work.
(Prepared by Lisa White, Foreign Law Specialist, July 2006.)
Attachment 1
Under the New Zealand ``points system,'' points are awarded as
follows:
------------------------------------------------------------------------
Criterion Qualification/Points
------------------------------------------------------------------------
Skilled employment........................ Current on-going NZ
employment for 12 months or
more----60
Offer of employment or
current employment (more
than 3 months but less than
12 months)------------------
------50
Bonus points for employment or offer of Region outside
employment in future growth area, Auckland-------------------
identified cluster or area of absolute -------10
skills shortage. Spouse/partner offer of
employment-----------------
-10
Relevant work experience in comparable 2 yrs------------------------
labor market. 10
4 yrs------------------------
15
6 yrs------------------------
20
8 yrs------------------------
25
10 yrs-----------------------
30
Bonus points for work in NZ............... 2
yrs------------------------
-
4 yrs------------------------
10
6 yrs or more----------------
--15
Bonus points for work experience in an 2-5yrs----------------------
identified future growth area, identified -5
cluster or area of absolute skills 6 yrs or more----------------
shortage. --10
Bonus points if applicant's occupation is Relevant qualifications/work
on Long Term Skills Shortage List. experience-----------------
5
Offer of skilled
employment-----------------
-------5
Qualifications............................ Basic (trade, diploma,
bachelor's
degree)---------------50
Post-graduate (masters or
higher)--------------------
55
Bonus points for qualifications........... NZ qualifications (at least
2 years of study)-----------
--10
Qualifications in future
growth area, identified
cluster or area of absolute
skill
shortage-------------------
-------5
Spouse/partner
qualification--------------
-----------5
Age (must be between 20 and 55 yrs)....... 20-29-----------------------
-30
30-39-----------------------
-25
40-44-----------------------
-20
45-49-----------------------
-10
50-55-----------------------
-5
Close ties in NZ (eg. adult siblings, ----------------------------
children or parents). -10
------------------------------------------------------------------------
Law Library of Congress
Singapore
immigration points system for skilled workers
Executive Summary
Singapore has an open policy toward skilled migration and a
rotational/temporary program for unskilled workers. Highly skilled
workers are granted an Employment Pass and are not assessed via a
``points system,'' however middle management and technical workers are
granted an S Pass and are assessed via a points system. Points are
awarded on the basis of salary, education, experience and occupation.
Generally, an employer applies for an S Pass on behalf of a prospective
employee.
I. Current Immigration Law
The Republic of Singapore (Singapore) has an open immigration
policy toward skilled and business migration and a guest worker program
intended for unskilled and semi-skilled workers. Singapore does not
undertake humanitarian migration. The primary pieces of legislation are
the Immigration Act (CAP 133) and the Employment of Foreign Workers Act
(CAP 91A). All work visas are issued and controlled by the Ministry of
Manpower \1\; however, other visas and registration of citizenship and
permanent residency, as well as border control, are managed by the
Immigration and Checkpoints Authority under the Ministry of Home
Affairs.\2\
---------------------------------------------------------------------------
\1\ See Ministry of Manpower--http://www.mom.gov.sg (last visited
July 12, 2006).
\2\ See Immigration and Checkpoint Authority--http:/
//app.ica.gov.sg/about_ica/about_ica.asp (last visited July 12, 2006).
---------------------------------------------------------------------------
In general all foreigners who wish to engage in business or
employment in Singapore must have a valid ``visa'' (or work permit).\3\
Employers of foreign workers must pay a levy in relation to each worker
and, in relation to some employees, must comply with quotas and lodge
security bonds.
---------------------------------------------------------------------------
\3\ Immigration Act CAP 133 Sec. 6(1).
---------------------------------------------------------------------------
There are three main types of work visas \4\:
---------------------------------------------------------------------------
\4\ It should be noted that there are also Short Term Employment
Passes that permit employees with acceptable professional/tertiary
qualifications, earning more than SGD$2,500 per month, to enter
Singapore and undertake work on a specific project or assignment. This
pass is non-renewable. There are also visas for training employees in
Singapore and for entrepreneurs.
Employment Pass--P Pass/Q1 Pass for professional or
managerial workers with a monthly salary of above SGD$2,500. Assessment
via salary and professional qualifications or specialist skills in a
professional, administrative, executive or managerial capacity;
S Pass--for skilled technicians or middle-level managers
workers with a monthly salary of above SGD$1,800. Assessed on a
``points system'' (salary, education, experience and job type);
Work Permit--for semi-skilled or unskilled workers with a
monthly salary of no more than SGD$1,800 (includes domestic workers)
(restrictions on nationality of applicants).
Only the S Pass is assessed via a ``points system.''
II. Skilled Migration Numbers
Singapore does not release details of the number of visas issued
each year.\5\ Population statistics released by the Singaporean
government indicate that of the total population of 4,351,400,
permanent residents or citizens numbered 3,553,500. Therefore 797,900
are non-residents; this figure includes temporary workers, student visa
holders and long-term non-work visa holders.\6\
---------------------------------------------------------------------------
\5\ E-mail to author from Senior Public & Internal Communications
Executive Corporate Communications Division, Immigration & Checkpoints
Authority, Singapore Government, June 13, 2006.
\6\ Definition of non-resident population as used in census
collection ``Non-resident population are those who are non-citizens and
non-permanent residents of Singapore, such as employment pass holders,
work permit holders, student pass holders, dependent pass holders and
long-term social visit pass holders'' see http://www.singstat.govsg
//keystats/glossary/cglossary.html (last visited July 12, 2006).
---------------------------------------------------------------------------
III. Skilled Migration--Points System
S Pass applications are assessed on a points system over four main
categories: salary, educational qualifications, years of relevant work
experience and job type (such as specialized workers and technicians).
The Ministry of Manpower assesses each application against the S Pass
criteria.\7\
---------------------------------------------------------------------------
\7\ It is possible to submit an application even if a worker does
not appear to meet all the relevant criteria as each application will
be assessed on its own merits. See Ministry of Manpower--Employment/S
Pass Frequently Asked Questions--Can companies with Work Permit holders
who (nearly)/ meet the S Pass criteria apply for S Pass?, http:/
//www.mom.gov.sg/FAQs/SPass/ForEmployees/CriteriaforSpass.htm (last
visited July 12, 2006).
---------------------------------------------------------------------------
Salary is also a threshold criterion because to qualify for an S
Pass an applicant must be paid a minimum monthly basic salary of
SGD1,800. S pass holders who earn a minimum monthly basic salary of
more than SGP2,500 are permitted to bring their immediate families to
Singapore.\8\
---------------------------------------------------------------------------
\8\ Ministry of Manpower--S Pass Policy Brief. See http:/
//www.mom.gov.sg/ProceduresAndGuidelines/SPass/PolicyBrief.htm (last
visited July 12, 2006).
---------------------------------------------------------------------------
Singapore does not publish detailed descriptions of its assessment
process but states that the applicants accumulate points depending on
how well they meet the criteria. Singapore provides the following
descriptions for illustrative purposes: ``basic salary'' is a standard
component of income that allows for comparison of income across all
sectors and industries; ``qualifications'' refers to degree or diploma-
level education (but may extend to technical qualifications) and
generally should involve at least 1 year of full-time study; ``job
type'' is identified as professional, specialist or technician-level
jobs; and ``work experience'' refers to the number of relevant work
experience.\9\
---------------------------------------------------------------------------
\9\ Ministry of Manpower--Employment/S Pass--Frequently Asked
Questions as of July 11 2006, available at http://www.mom.gov.sg/FAQs
//SPass/ForEmployees/CriteriaforSpass.htm.
---------------------------------------------------------------------------
An example provided by the Ministry of Manpower of a successful S
Pass application is \10\:
---------------------------------------------------------------------------
\10\ Id.
---------------------------------------------------------------------------
1. Assistant electronic engineer with a monthly salary of SGD1800
and technical qualifications (i.e. the technician has been trained in
his or her chosen field, and the training was for at least 1 year of
full-time study) and 6 years of work experience.
An example provided by the Ministry of Manpower of an unsuccessful
S Pass application is:
2. Hotel Receptionist with monthly salary of SGD2000, 6 years work
experience and technical qualifications.
(Prepared by Lisa White, Foreign Law Specialist, July 2006.)
Law Library of Congress
United Kingdom
immigration points system for skilled workers
Executive Summary
The highly skilled migrant programme in the UK provides for a
points based system. The programme provides a method for applicants
that meet the required number of points to remain and work in the UK
without a work permit and, ultimately, a path to permanent residency.
The programme is thought to provide the most dramatic development in
immigration law for 30 years.
I. Introduction
The law governing, and policy surrounding, immigration in the UK is
highly complex, with the government attempting to balance the needs of
genuine visitors and the contributions they make to the economy of the
UK to those that wish to enter the UK for undesirable purposes. The
government has recently shifted to a policy of managed migration ``in
the interests of the economy'' \1\ in which the skills and benefits
that migrants bring to the country are emphasized, with particular
support for skilled workers \2\ and quotas for those without skills,
where there is a need in the UK.\3\
---------------------------------------------------------------------------
\1\ HOME OFFICE, CONTROLLING OUR BORDERS: MAKING MIGRATION WORK IN
BRITAIN, FIVE YEAR STRATEGY FOR ASYLUM AND IMMIGRATION, 2005, Cm. 6472.
\2\ Id.
\3\ HOME OFFICE, SECURE BORDERS, SAFE HAVEN: INTEGRATION WITH
DIVERSITY, 2002, Cm. 5387.
---------------------------------------------------------------------------
The statutory regime governing immigration in the UK is now
contained in the Immigration Act 1971 \4\ and the Immigration Rules \5\
made under it. The law requires that individuals who are not British or
Commonwealth citizens with the right of abode in the UK, nor members of
the European Economic Area,\6\ obtain leave to enter the UK from an
immigration officer upon their arrival.\7\
---------------------------------------------------------------------------
\4\ Immigration Act 1971, c. 77.
\5\ Immigration Rules, H.C. 395, (as amended). R v Chief
Immigration Officer, Heathrow Airport, ex. p. Salamat Bibi [1976] 3 All
ER 843 (CA) per Roskill, LI : ``these rules are [not administrative
practice and are] just as much delegated legislation as any other form
of rule making activity . . . which is empowered by an Act of
Parliament. Furthermore, these rules are subject to a negative
resolution and it is unheard of that something which is no more than an
administrative circular stating what the Home Office considers to be
good administrative practice should be subject to a negative resolution
by both Houses of Parliament. These rules, to my mind, are just as much
a part of the law of England as the 1971 Act itself.
\6\ The European Economic Area consists of the Members of the
European Union, plus Norway, Iceland and Liechtenstein.
\7\ Immigration Act 1971, c. 77, Sec. 3 and the Immigration Rules,
H.C. 395, para. 7.
---------------------------------------------------------------------------
II. Highly Skilled Migrant Programme
The highly skilled migrant programme has been cited as ``the most
dramatic development in commercial immigration law for the past 30
years and has made many of the other commercial immigration categories
effectively redundant.\8\ The highly skilled migrant programme enables
individuals to enter the UK without the need for a work permit; without
a business plan; to create jobs; invest money in the UK; or with a
specific job offer.\9\ It is designed to ``allow highly skilled
individuals with exceptional personal skills and experience to come to
the United Kingdom to seek work or self-employment opportunities.''
\10\
---------------------------------------------------------------------------
\8\ MACDONALD'S IMMIGRATION LAW AND PRACTICE, (Ian McDonald et. al
eds., 6th ed 2003), para. 10.77.
\9\ Immigration Rules, H.C. 395 para. 135, at http:/
//www.ind.homeoffice.gov.uk/lawandpolicy/immigrationrules/part5 (last
visited June 15, 2006).
\10\ Immigration Directorates Instructions, c. 5, Sec. 11.
---------------------------------------------------------------------------
Individuals that apply under the scheme must show that they have
the appropriate documentation issued by the Secretary of State to enter
the UK under the HSMP; have appropriate entry clearance; intend to make
the UK their main home; and be able to accommodate and maintain
themselves and any dependents without recourse to public funds.\11\
---------------------------------------------------------------------------
\11\ Immigration Rules, H.C. 395 para. 135, at http:/
//www.ind.homeofce.gov.uk/lawandpolicy/immigrationrules/part5 (last
visited June 15, 2006).
---------------------------------------------------------------------------
III. The Use of Points
The HMSP is operated on a points basis, with a score of 65 or more
qualifying the applicant as a highly skilled migrant. The points are
awarded in five main areas:
educational qualifications;
work experience;
past earnings--the amount of points awarded for past
earning are in three different bands that adjust for four different
groups of countries, which are coded A-E.\12\ The county list ``has
been designed in consultation with the Treasury and an external
consultant and is based on World Bank data of Gross Domestic Product
(GDP) per capita'' \13\;
---------------------------------------------------------------------------
\12\ A full list of the countries and their appropriate codes is
provided for in the Immigration Directorates Instructions, c. 5,
Sec. 11, Annex Z3, http://www.ind.homeoffice.gov.uk/documents
//idischapter5annexes/sectionl l/annexz3.pdf?view=Binary (last visited
July 12, 2006).
\13\ A list of the current 50 top business schools is provided for
in the Immigration Directorates Instructions, c. 5, Sec. 11, Annex Z8.
---------------------------------------------------------------------------
achievements in the applicant's field--achievements
include such things as published work, scholarships, and industry
prices; and
achievements of the applicant's married or unmarried
partner (this includes same-sex partners)--there is a 10 point
allowance for applicants whose partners have a degree (or equivalent)
qualification or are currently employed in a graduate level job.\14\
---------------------------------------------------------------------------
\14\ Guidance to caseworkers is provided online: Immigration
Directorates Instructions, c. 5, Sec. 11, Annex Z1, http:/
//www.ind.homeoffice.gov.uk/documents/idischapter5annexes/sectionl l
//annexzl.pdf?view=Binary (last visited July 13, 2006).
---------------------------------------------------------------------------
Individuals under the age of 28 at the time of application are
awarded an additional five points and are awarded more points for
lesser experiences than those over the age of 28.
In 2005, the government introduced a new provision enabling
individuals with a Masters Degree in Business Administration from one
of the 50 top business schools, as designated by HM Treasury,\15\ the
ability to ``meet the points criteria on the basis of their MBA
alone.\16\ Thus, individuals that have graduated from one of the
eligible business schools with an MBA are automatically awarded the 65
points that are needed to qualify under the HSMP. The aim of the
inclusion of this provision is to ``attract highly qualified and
talented managers to the UK'' \17\ to address a ``weakness in the UK
economy in the quality of management.\18\
---------------------------------------------------------------------------
\15\ A list of the current 50 top business schools is provided for
in the Immigration Directorates Instructions, c. 5, Sec. 11, Annex Z8.
\16\ Immigration Directorates Instructions, c. 5, Sec. 11.
\17\ Immigration Directorates Instructions, c. 5, Sec. 11.
\18\ Immigration Directorates Instructions, c. 5, Sec. 11, Annex
Z7.
---------------------------------------------------------------------------
The table below provides an overview of the points awarded in the
various categories for the different age groups:
------------------------------------------------------------------------
Criteria Under 28 Years Over 28 Years
------------------------------------------------------------------------
Educational Qualifications...... Ph.D.: 30 points; Ph.D.: 30 points;
master's degree master's degree
25 points; 25 points;
bachelor's degree bachelor's degree
15 points. 15 points.
Work Experience................. 25 points for 2 25 points for 5
years of full- years of full-
time graduate time graduate
level experience; level experience
35 points for 4 or Ph.D. and 3
years of full- years of graduate
time graduate level experience;
level experience; 35 points for
or 50 points for criteria as
4 years of full- above, but
time graduate including 2 years
level experience or more
with at least 1 experience at a
of these years specialist or
served at a senior level; 50
senior or points for 10
specialist role. years of full-
time graduate
level experience;
or 50 points for
4 years of full-
time graduate
level experience
with at least 5
of these years at
a senior or
specialist role.
Past Earnings................... The lowest income The lowest income
on the band is on the band is
2,350 3,500
(approximately (approximately
$4,100) for $6,100) for
country code E country code E
(includes (includes
countries such as countries such as
Ghana) and the Ghana) and the
highest is 60,000 pound>250,000
(approximately (approximately
$105,000) for $437,500) for
country code A country code A
(includes (includes
countries such as countries such as
the United the United
States). States).
Applicants with Applicants with
income in band 1 income in band 1
are awarded 25 are awarded 25
points; those in points; those in
band 2 are band 2 are
awarded 35 points awarded 35 points
and those in band and those in band
3, 50 points. 3, 50 points.
Achievements by the Applicant's 15 points awarded 15 points awarded
Field. to those with to those with
significant significant
achievements; 25 achievements; 25
points awarded to points awarded to
those with those with
exceptional exceptional
achievements. achievements.
Achievements in the Applicant's 10 points......... 10 points
Partner.
MBA............................. 65 Points......... 65 Points
General Practitioners with 50 points......... 50 points
British General Medical Council
certification and one other
approved qualification..
------------------------------------------------------------------------
Individuals entering the UK under this programme may remain for up
to 2 years. This period can be renewed for an additional 3 years,
subject to certain requirements, such as the applicant having taken all
reasonable steps to become economically active during his time in the
UK. The renewal then enables the worker ultimately to apply for
permanent residency in the UK after legally residing there for a
continuous period of 5 years.\19\
---------------------------------------------------------------------------
\19\ Home Office, Working in the UK: Work Permits, http:/
//www.workingintheuk.gov.uk/working_in_the_uk/en/homepage
//workjermits.html (last visited Feb. 15, 2006).
(Prepared by Clare Feikert, Foreign Law Specialist, July 2006.)
Prepared Statement of Katharine M. Donato*, Douglas S. Massey,
and Brandon Wagner
Abstract
A major shortcoming of most prior research on services and taxes is
the inability to disaggregate findings by legal status. Data from the
Census and Current Population Survey only distinguish between citizens
and other foreigners, and very few datasets contain information
sufficient to identify undocumented migrants with any reliability. The
one exception is the Mexican Migration Project, which has compiled
information on taxes paid and services used by Mexican migrants in all
legal statuses for more than two decades. In this paper, we use these
data to shed light on the patterns and determinants of service use and
tax payment among the largest immigrant population in the United
States. Our findings illustrate that rates of service usage have
dropped since 1986, at the same time that rates of tax payment and
health insurance coverage have risen. The net effect of these two
countervailing trends, we argue, has been a sharp decline in the use of
unreimbursed services by Mexican migrants to the United States.
---------------------------------------------------------------------------
This paper was prepared for presentation at the 2006 annual meeting
of the Population Association of America in Los Angeles. We gratefully
acknowledge generous support from NICHD, the William and Flora Hewlett
Foundation, and the Mellon Foundation.
* For more information, please contact Katharine M. Donato,
Associate Professor, Rice University, 6100 Main Street, Houston TX
77005, [email protected].
---------------------------------------------------------------------------
The Chilling Effect: Public Service Usage by Mexican Migrants
to the United States
Two trends have coincided during the 1960s and 1970s: expansion of
the U.S. welfare State and the resurgence of mass immigration from poor
countries. The salience and simultaneity led some to wonder whether
immigrants were arriving to take advantage of generous social services
offered by the United States, and whether citizen taxpayers were
somehow paying for these services. By the end of the century, this
topic--the cost of public services consumed by immigrants--has led to
controversy and debate about two questions. First, to what extent do
undocumented migrants in the United States use publicly provided
services? And second, to what degree are the public services they
consume offset by immigrant-generated tax revenues?
Although prior studies have considered the first question, this
work has been more speculative than analytic because reliable data on
undocumented migrants are scarce. One early review of existing studies
largely based on small convenience samples found that authorized
migrants rarely drew upon means-tested services such as welfare, food
stamps, or supplemental security income (Massey and Schnabel 1983).
When undocumented migrants did make use of U.S. educational and medical
services at higher rates, their usage was lower than one would predict
given their socioeconomic characteristics (Massey et al. 1987).
Studies of service use by documented immigrants have relied on
census data on the foreign born. Although foreigners enumerated in the
census include a significant number of undocumented migrants and
legally resident nonimmigrants, census data are tacitly assumed to
refer only to legal immigrants and citizens. This assumption, however,
has become increasingly problematic because of the growing settlement
of undocumented migrants and the increasing entry of legal temporary
workers (see Massey and Bartley 2005).
Some early work based upon the 1980 census suggested that the
foreign born were less likely than natives to use publicly provided
services, controlling for their demographic, social, and economic
characteristics (Tienda and Jensen 1986; Jensen and Tienda 1988).
However, using 1970-1990 data, Borjas and colleagues found that welfare
use increased with time spent in the United States and that recently
arrived immigrants used social services at significantly higher rates
than earlier arrivals (Borjas and Trejo 1991; Borjas 1995). Borjas and
Trejo (1993) also found that much of the change in welfare usage was
driven by the shift in immigrant origins toward nations that sent large
number of refugees, such as Russia, Cuba, Vietnam, and Cambodia. In
contrast to immigrants admitted for family reunification or employment
reasons, refugees generally display higher rates of social service
usage.
Although service consumption by immigrants has been a topic of
public discussion since the 1960s, the issue gained considerable
traction during the early 1990s. In the context of a severe economic
recession, the use of public services by foreigners became an explosive
issue, especially in California, the largest immigrant-receiving State
and one of the States hit hardest by the post-cold war recession. In
1993, anti-immigrant activists succeeded in placing on the ballot
Proposition 187, also known as the ``Save Our State'' (i.e. SOS)
initiative. Passed by a wide margin, the proposition banned
undocumented migrants from receiving all publicly provided services
except emergency medical care. Although Federal courts struck down most
of its provisions as unconstitutional, Proposition 187 nonetheless
served as a potent vehicle for conservative political mobilization and
fed directly into the emerging debate on welfare reform.
As the 1990s progressed, many continued to publish studies
documenting inter-cohort increases in welfare use and to publicize the
results in popular outlets (Borjas 1996; Borjas and Hilton 1996). In
one particularly provocative paper, Borjas (1999) argued that once in
the United States, immigrants were drawn to States that offered the
highest welfare benefits. He estimated a model showing that, other
things equal, immigrants on welfare were more concentrated in high-
benefit States than those who were not on welfare and coined the term
``welfare magnets'' to describe high-benefit States. Although Massey
and Espinosa (1997) have shown that welfare was not a significant force
in attracting immigrants in the first place, the term stuck and
resonated with the public.
The wave of concern about immigration and welfare crested in 1996
with the passage of two pieces of reform legislation. The Illegal
Immigration Reform and Immigrant Responsibility Act (usually called the
1996 Immigration Reform Act) declared undocumented migrants ineligible
to receive social security benefits and limited their eligibility for
educational benefits, even if they had paid the requisite taxes; it
also gave authority to States to limit public assistance to all foreign
nationals, whether legal or illegal. The Personal Responsibility and
Work Opportunity Reconciliation Act also contained provisions with far-
reaching effects on immigration. Known as the 1996 Welfare Reform Act,
it barred illegal migrants from most Federal, State, and local public
entitlement programs and required Federal verification of the
immigration status of all foreign nationals before they could receive
any Federal benefit. It also placed new restrictions on legal immigrant
access to public services, barring them from receiving food stamps or
supplemental security income, and prohibiting them from using any
means-tested program for 5 years after admission. The Welfare Reform
Act also gave States greater flexibility in setting eligibility rules
for legal immigrants, and gave them the statutory authority to exclude
them entirely from Federal and State programs.
Together these two pieces of legislation accomplished nationally
what Proposition 187 was unable to do in California--it definitively
barred undocumented migrants from social security coverage and means-
tested programs. But Federal lawmakers went further than Proposition
187 by drastically reducing the access of legal immigrants to public
programs. The end result was a ``chilling effect'' on the use of social
services by all immigrants (Fix and Zimmerman 2004). Throughout the
United States rates of welfare and other entitlement use by foreigners
fell sharply. In most regions of the country the drop paralleled a
similar decline among natives, but in California the decline among
immigrants was much steeper (Zimmerman and Fix 1998; Borjas 2002), even
for services to which they were legally entitled. Therefore, by the
turn of the century, rates of immigrant welfare use had fallen to
historically low levels.
Determining the net balance between public funds expended on behalf
of immigrants and tax revenues generated by them is a tricky exercise
in statistical modeling that involves many assumptions and educated
guesses. The most comprehensive analysis of the net fiscal effect of
immigration was undertaken by the National Research Council (NRC) (see
Smith and Edmonston 1997). It concluded that although immigrants
produced a net fiscal gain for Federal coffers, they constitute a net
loss for State and local governments. Drawing on research by Clark
(1994), Vernez and McCarthy (1995), and Espenshade and colleagues
(Rothman and Espenshade 1992; Garvey and Espenshade 1996) as well as
its own calculations, the NRC figured that under current conditions,
the cost of admitting an immigrant was around $10 per year for each
native household in New Jersey and around $45 in California.
In sum, a major shortcoming of most prior research on services and
taxes is the inability to disaggregate findings by legal status. Data
from the Census and Current Population Survey only distinguish between
citizens and other foreigners, which consist of legal permanent
residents, undocumented migrants, and foreigners living in the United
States with temporary, nonresident visas (Massey and Bartley 2005).
Very few datasets contain information sufficient to identify
undocumented migrants with any reliability. The one exception is the
Mexican Migration Project, which has compiled information on taxes paid
and services used by Mexican migrants in all legal statuses for more
than two decades. In this paper, we use these data to shed light on the
patterns and determinants of service use and tax payment among the
largest immigrant population in the United States.
data and measures
The Mexican Migration Project (MMP) began in 1982 and, since 1987,
it has annually surveyed communities throughout Mexico to build a
comprehensive data base on documented and undocumented migration to the
United States. Its procedures and the resulting data sets have been
exhaustively described in numerous publications (see Massey 1987;
Massey and Zenteno 2000; Massey and Capoferro 2004; Durand and Massey
2004). Each year 4-6 communities ranging in size from small villages to
neighborhoods in large metropolitan areas are selected and randomly
surveyed. A semi-structured interview known as the ethnosurvey is
applied to gather social, demographic, and economic information about
each household and its members. A special module collects information
on the first and last U.S. trips made by each household member, and all
household heads and spouses are administered a retrospective
questionnaire that compiles a complete history of migration from age 15
(or age of entry into the labor force) onward. Heads are also asked a
detailed battery of questions about their last trip to the United
States, including specific queries about service usage and tax payment.
Copies of the MMP questionnaire, a description of the sample, and all
data files are available from the project Web site at http:/
//www.opr.mmp.princeton.edu/.
Each Mexican community survey is followed a few months later by a
survey of out-migrants originating in that community who have settled
in the United States and no longer return home regularly to be
interviewed south of the border. These respondents are located using
snowball or chain-referral sampling methods. Data from surveys on both
sides of the border are then cleaned, coded, and assembled into
composite files that have been shown to be remarkably representative of
the bi-national migrant community formed by recurrent migration and
settlement (Massey and Zenteno 2000). As of the present writing, this
data set includes 93 Mexican communities containing 16,000 households
and more than 80,000 individuals.
Although the MMP has tried to achieve consistency in measurement
over time, some changes have been introduced into questions on service
usage. Prior to 1998 (or the first 52 communities), questions on
service usage asked whether food stamps, unemployment insurance, or
welfare payments were ever received ``over the length of your
experience of life or work in the United States.'' Beginning in 1998,
however, the question was re-worded to refer to services consumed ``on
the last trip or most recent visit to the United States.'' In addition,
the new question added specific queries about use of the nutritional
supplement program for women, infants, and children (WIC); Supplemental
Security Income program for the disabled and impoverished elders (SSI);
general assistance provided by individual States; Temporary Assistance
to Needy Families (TANF) program that replaced Aid to Families with
Dependent Children after the Welfare Reform Act was implemented in
1996; and Medicaid, the Federal health subsidy program serving the
uninsured poor. Other new questions on contributions were also added in
1998, including whether respondents filed a tax return and held a U.S.
credit card.
Aside from these additions, there was an important shift in the
reference period of the question wording from lifetime use to
consumption on the last U.S. trip. For migrants with only one trip, the
resulting data are equivalent. But for those with multiple trips, the
meaning of these data depends on whether the service usage question was
asked before or after 1998. Therefore, to ensure comparability, we
exclude migrants with multiple trips from data collected in 1997 or
before. This permits us to gain comparability over time, even though we
sacrifice interesting information on lifetime patterns of service usage
by migrants with extensive U.S. experience. All subsequent analyses
thus refer to the services used and contributions made at the time of
the migrant's most recent U.S. trip. For interviews completed before
1998, it is also their first trip.
service use and contributions by legal status
Table 1 shows contributions and consumption by Mexican migrants to
the United States in three legal status groups: citizens and legal
permanent residents, who we call documented migrants; persons who
entered the country without inspection or entered legally but violated
the terms of their visa, who we call undocumented migrants; and those
who entered on a legitimate nonresident visa (e.g. tourist or temporary
worker) but did not violate its terms, who we call temporary migrants.
We divide the services consumed by immigrants into two categories--
those that are unrestricted entitlements accessible to anyone in the
United States irrespective of legal status, and those that involve some
sort of legal test or administrative filter to confirm eligibility.
According to Federal court decisions, the only unrestricted services
are public education and medical care. Since 1996, most other services
entail some sort of restriction or eligibility check.
Table 1.--Social Service Usage and Societal Contributions Reported by Mexican Migrants on Their Last Trip to the
United States by Legal Status
----------------------------------------------------------------------------------------------------------------
Citizen Temporary
Usage or Contributions or Legal Undocumented Visitor Total
Resident or Worker
----------------------------------------------------------------------------------------------------------------
Unrestricted Services:
School........................................................... 34.6 10.6 6.4 17.1
Doctor........................................................... 65.2 32.8 23.9 40.2
Hospital......................................................... 57.1 25.7 17.2 33.6
Restricted Services:
Food Stamps...................................................... 10.7 4.0 2.1 5.7
Welfare.......................................................... 7.8 3.1 2.1 4.3
Unemployment..................................................... 27.8 4.0 3.0 11.0
TANF*............................................................ 1.5 0.6 0.3 0.7
WIC*............................................................. 9.8 4.1 1.3 4.6
SSI*............................................................. 0.4 0.6 0.3 0.5
General Assistance*.............................................. 1.8 0.2 0.0 0.0
Medicaid......................................................... 5.2 9.3 4.9 7.0
Societal Contributions:
Social Security Tax.............................................. 89.0 66.2 64.3 72.8
Federal Income Tax............................................... 87.6 62.8 60.3 70.0
Pays for Health Care............................................. 67.1 49.8 39.0 56.3
Has Health Insurance............................................. 4.7 3.3 4.0 4.0
Societal Connections:
Has U.S. Bank Account............................................ 35.3 7.0 5.3 15.1
Submit U.S. Tax Return*.......................................... 59.0 9.3 12.6 19.2
Has U.S. Credit Card............................................. 24.2 3.3 5.4 7.6
Number of Migrants................................................. 1,188 2,101 701 3,990
----------------------------------------------------------------------------------------------------------------
* Question only asked after 1996.
We also divide immigrant contributions into two categories. The
first category includes direct financial contributions to offset the
cost of providing public services, namely taxes withheld and health
contributions made either through personal funds or in the form of
insurance payments. The second are more general indicators of
connections or contributions to U.S. society, such as filing a tax
return, having a bank account, and possessing a credit card. These
indicate the degree to which a migrant is integrated into the American
economy. Filing a tax return is particularly crucial in assessing the
cost of services because not submitting a return precludes the
possibility of receiving any kind of refund. Unless a return is filed,
taxes paid represent a permanent contribution to government ledgers.
The top panel of the table reports usage rates for unrestricted
services to which immigrants have a basic human right as U.S.
residents. Since people inevitably get sick and suffer mishaps and
accidents, it is not surprising that the highest use levels are
observed for medical services. Overall, 40 percent of Mexican migrant
household heads reported seeing a doctor in the United States and one-
third said they had visited a hospital. In contrast, just 17 percent of
migrants reported sending children to U.S. schools.
Despite the presumed universality of the right to education and
health in the United States, we nonetheless observe large differentials
by legal status, with rates of usage among documented migrants being 2-
3 times those of the undocumented. Thus, whereas 65 percent of citizens
and legal residents reported seeing a doctor and 57 percent visited a
hospital, the figures were only 33 percent and 26 percent among those
in unauthorized status. Likewise, whereas 35 percent of documented
migrants sent children to U.S. public schools, only 11 percent of
undocumented migrants did so. Service rates were lowest among temporary
migrants. Just 24 percent said they had seen a doctor, 17 percent had
visited a hospital, and 6 percent had used U.S. schools on their last
trip to the United States.
Given the large usage differentials by legal status for
unrestricted services, we expect to uncover even larger differentials
for those that are restricted. The second panel of Table 1 suggests
that this is generally the case. Among restricted services, the highest
usage rates are observed for unemployment compensation, with 28 percent
of citizens and legal residents reporting usage on the last trip. Among
undocumented migrants, however, the usage rate was just 4 percent,
compared with 3 percent for temporary migrants. Moreover, usage rates
for welfare and food stamps are low even among citizens and legal
resident aliens. Only 11 percent said they used food stamps on their
last trip and just 8 percent said they had been on welfare. For
undocumented and temporary legal migrants, usage rates never exceed 4
percent.
Questions about the use of specific public services--TANF, WIC,
Medicaid, and general assistance--were only included after 1997. The
WIC food supplement program for pregnant women and infants displayed
the highest rate of usage at around 10 percent for documented migrants,
4 percent for persons in unauthorized status, and just 1 percent among
temporary migrants. Medicaid--the federally subsidized health
assistance program for the poor--was the only program where usage rates
were higher for undocumented than documented migrants, being 9 percent
for the former and 5 percent for the latter, compared with 5 percent
for temporary migrants. Rates for the use of the current welfare
program (TANF), supplemental security income (SSI), and general
assistance were generally minuscule, even among legal immigrants and
citizens, much less among undocumented and temporary migrants.
However, when it comes to the financial contributions to public
ledgers, rates of immigrant participation are much higher and
differentials by legal status are muted. Thus, 89 percent of documented
migrants reported having social security taxes withheld from their pay,
and 88 percent reported withholding of income taxes. Although the
percentages were smaller for undocumented migrants, they were still
rather robust at 66 percent for social security taxes and 63 percent
for income taxes, and for temporary migrants at 64 percent and 60
percent. Among the 820 documented migrants who reported using a doctor
or hospital in the United States, 67 percent reported paying the bill
themselves and 5 percent said it was covered by private health
insurance. Among undocumented the 772 migrants using medical services,
the respective figures were 50 percent and 3 percent, compared with 39
percent and 4 percent among 190 temporary migrants.
Although we do not have precise information on the amounts
withheld, these relatively high rates of tax payment would appear to
offset the cost of service usage by Mexican migrants, particularly
among the undocumented. However, the degree to which tax payments
offset the social costs of immigrants also depends on whether some or
all of the money paid in taxes is returned to migrants as a refund
after the end of the tax year. Although we do not know whether
respondents received a refund or how much they received, we do know
whether they filed a return at all; and if no return was filed, then
certainly no refund was received.
As Table 1 shows, there is a sizeable gap between the percentage
paying taxes and the percentage filing a return among all groups, but
it is largest among undocumented and temporary migrants. Whereas around
9 out of 10 citizens and legal residents paid taxes, only around 60
percent filed a return, meaning that at least 30 percent received no
refund. Furthermore, among undocumented and temporary migrants, even
though two-thirds had taxes withheld, only 9 percent to 12 percent
submitted a tax return, suggesting that upwards of 50 percent received
no refund. Indicators of other connections to U.S. society likewise
display similar sharp differentials according to legal status. Whereas
around a third of documented migrants reported having a U.S. bank
account and about a quarter owned a U.S. credit card, the respective
figures for undocumented migrants were just 7 percent and 3 percent,
whereas among temporary migrants they were about 5 percent in each
case.
The overall pattern that emerges is one in which undocumented and
temporary migrants, and to a lesser extent legal residents and
citizens, pay taxes at relatively high rates but make relatively little
use of publicly provided services and are unlikely to submit a request
for tax refunds. This profile, however, only represents the average
situation of migrants who may have taken trips across a range of
different years, and our review of recent shifts in immigration and
welfare policy suggest that rates of usage might have changed
dramatically in the 1990s. In the next section, therefore, we examine
trends in service usage and financial contribution by period.
trends in service use and contributions
We classify the time of the trip into four distinct periods. Years
prior to 1987 correspond to the pre-IRCA period, years before the
passage of the Immigration Reform and Control Act, which dramatically
altered the status quo for Mexican immigrants in a variety of ways,
notably by criminalizing undocumented hiring, legalizing former
undocumented workers, and inaugurating a secular build-up of border
enforcement resources. The period 1987-1992 is the period immediately
post-IRCA when legalization applications were being processed, 2.3
million Mexicans were receiving permanent residence status, and the
size and resources of the U.S. Border Patrol began to expand. The
period 1993-1996 is when Proposition 187 mobilized anti-immigrant
sentiment in California, Operation Blockade was launched to prevent the
crossing of undocumented migrants in El Paso, and Operation Gatekeeper
was inaugurated to prevent unauthorized border-crossings in San Diego.
This period culminated with the passage of the Immigration and Welfare
Reform Acts in 1996. The final period is the post-reform period, when
border enforcement reached new heights (Andreas 2000; Massey, Durand,
and Malone 2002).
Documented Migrants
Figure 1 shows period-specific trends in the use of social services
by household heads who were citizens or legal resident aliens at the
time of their last trip, focusing on those services for which data
exist across all survey years. The overall direction of the usage
curves is downward, providing support for the ``chilling effect'' of
U.S. policies noted by Zimmerman and Fix (2004), even for unrestricted
services such as education and medical care. Whereas 70 percent of
documented migrants said they used a doctor on trips taken prior to
1993, afterward the usage rate fell sharply, reaching 55 percent in
1993-1996 and 41 percent in 1997-2002. A similar pattern is observed
for hospital usage, which fell from 68 percent before 1987 to 42
percent in 1997-2002. Use of public schools by documented migrants
likewise dropped from 52 percent before IRCA to just 19 percent in the
post-reform era after 1996, and unemployment fell from a peak of around
33 percent in 1987-1992 to just 9 percent in 1997-2002. Rates of
welfare and food stamp usage were very low irrespective of period,
fluctuating closely around 10 percent.
The foregoing graph thus confirm a ``chilling effect'' in the use
of public services by legal Mexican immigrants but suggest that it
started before national reform legislation was passed in 1996, dating
back to Proposition 187 and the various border mobilizations in the
early 1990s. While a chilling effect may have taken hold in the use of
public services, however, it does not appear to have extended to the
payment of taxes and other societal contributions. Figure 2 shows that
the withholding of Federal taxes remained high and steady in the range
of 80-90 percent from before 1987 through 1996, and then increased to
record levels that approached 100 percent in later years. As of the
most recent period, 97 percent reported tax withholding and 67 percent
reported filing a tax return, yielding a smaller gap than before 1987
but sizeable nonetheless. The only decline was in the percentage of
respondents who said they paid for their own health care; it dropped
gradually through 1996 but sharply thereafter, mirroring the shift in
the share saying they had health insurance coverage. This suggests a
direct substitution between insurance and out-of-pocket payment, and
hence, no increase in the potential burden to taxpayers.
Undocumented Migrants
Although undocumented migrants may have certain rights to education
and health care, their usage rates are nonetheless low compared with
documented migrants irrespective of period. But like them, undocumented
migrants display a decline in usage rates beginning after 1992. The
percentage seeing a doctor declined from around 37 percent on trips
taken between 1987 and 1992 to around 18 percent between 1997 and 2002,
and usage rates of hospitals displayed a very similar trend. Usage
rates for entitlement programs such as welfare, food stamps, and
unemployment compensation were well under 10 percent across all
periods, and trended down toward zero in the final period. The use of
U.S. public schools by undocumented migrants peaked at around 14
percent in 1987-1992 and fell by half to 7 percent in 1997-2002.
As with documented migrants, the decline in undocumented service
usage was not accompanied by a corresponding drop in their financial
contributions. As shown in Figure 4, tax withholding among them dipped
slightly during the periods 1987-1992 and 1993-1996, but then recovered
to reach a level of around 66-67 percent in 1997-2002, just below where
it had been before 1987. At the same time, the percentage of
undocumented migrants filing a tax return, which was low to begin with,
fell even lower after 1992 reaching 5 percent in 1997-2002. Whereas
two-thirds of undocumented migrants paid into the U.S. tax system, the
vast majority did not file a tax return to collect a refund and most
were not using any services. However, the rate at which undocumented
migrants reported paying for their health care declined slowly from 52
percent to 42 percent, and unlike documented migrants, this shift was
not offset by an increase in insurance coverage.
Temporary Migrants
Perhaps the starkest evidence of a chilling effect after 1996
occurred among legal temporary migrants. As shown in Figure 5, visits
to the doctor held fairly steady at just under 30 percent from before
1987 through 1996, but then plummeted to 5 percent. The pattern for
hospital visits was similar, dropping from 22 percent in 1993-1996 to 6
percent in 1997-2002. By the most recent period, usage rates for
virtually all social services had converged to a narrow range from 0
percent to 6 percent, by far the lowest of any legal status group.
Despite the decline in service usage, the contribution rates
generally remained steady, with approximately 50 percent of temporary
migrants reporting the withholding of Federal taxes in the most recent
period and a slight decline in the tendency to file tax returns, which
was only reported by 8 percent of respondents (see Figure 6). As with
the documented migrants, there was a sharp decline in personal payments
for health care, but like undocumented migrants, this drop was not
offset by a corresponding increase in insurance coverage.
determinants of service use
Although the foregoing analyses are consistent with the hypothesis
of a chilling effect in the use of public services, it is always
possible that the trend toward lower rates of service usage reflects
changes in underlying individual or family characteristics associated
with service use rather than shifts in public policies or political
climate. Table 2 thus estimates a series of logistic regression models
to predict the odds of using three kinds of services from a series of
period indicators while controlling for a migrant's personal
characteristics, education, occupation, family situation, prior U.S.
experience, and legal status. If migrants reported using food stamps,
welfare, or unemployment on the last U.S. trip, we coded the indicator
for social service usage as 1 and set to 0 otherwise. If migrants
reported going to a doctor or hospital on the most recent U.S. visit,
the indicator for health services was coded 1 and set to 0 otherwise.
Finally, the indicator for public schools is a simple dummy variable
that took the value of 1, when respondents reported having children in
U.S. schools, and 0 otherwise. In all comparisons, the reference
category is the pre-IRCA (before 1987) period.
Table 2.--Effect of Selected Characteristics on the Use of Public Services by Mexican Migrants in the United
States
----------------------------------------------------------------------------------------------------------------
Social Welfare Health Services Public Schools
Variables --------------------------------------------------------------------------
B SE B SE B SE
----------------------------------------------------------------------------------------------------------------
Period of Trip:
<1987
1987-1992.......................... 1.198* 0.099 0.439* 0.037 0.238* 0.042
1993-1996.......................... 1.184* 0.072 0.438* 0.052 0.058 0.062
1997-2002.......................... 0.579* 0.082 -0.212* 0.050 -0.569* 0.070
Personal Characteristics:
Female............................. 0.794* 0.075 0.748* 0.069 0.964* 0.069
Age................................ -0.123* 0.009 0.007 0.007 0.160* 0.009
Age Squared........................ 0.001* 0.000 0.000 0.000 -0.001* 0.000
Married............................ 0.329* 0.054 -0.281* 0.042 0.702* 0.050
Speaks Some English................ 0.067 0.047 0.589* 0.035 0.590* 0.038
Years of Schooling:
None
1-5................................ 0.167* 0.073 -0.186* 0.045 -0.090 0.057
6-11............................... -0.406* 0.075 -0.335* 0.050 0.007 0.060
12+................................ 0.102 0.089 -0.785* 0.069 -0.785* 0.082
U.S. Occupation:
Professional
Skilled Manual..................... -0.675* 0.138 -0.247 0.161 -0.079 0.129
Unskilled Manual................... -0.685* 0.124 -0.252 0.158 -0.086 0.125
Agricultural....................... -0.366* 0.140 -0.245 0.161 -0.534* 0.120
Not Working........................ -0.901* 0.173 -0.615* 0.174 0.115 0.150
Job Missing........................ -0.035 0.188 -0.938* 0.202 -0.305 0.171
Family in United States:
No. of Siblings in United States... 0.123* 0.010 0.081* 0.009 0.070* 0.009
Parent in United States............ -0.333* 0.045 0.279* 0.038 -0.198* 0.041
No. of Relatives in United States.. 0.003* 0.001 0.014* 0.001 0.007* 0.001
No. of U.S.-Born Children.......... 0.634* 0.018 1.764* 0.046 1.071* 0.020
U.S. Experience:
No. of Prior Trips................. 0.007 0.004 0.033* 0.003 0.040* 0.003
Duration of Last Trip.............. -0.001* 0.000 0.008* 0.001 0.006* 0.001
Legal Status:
Legal or Citizen...................
Temporary.......................... -0.715* 0.099 -0.658* 0.051 -0.501* 0.068
Undocumented....................... 0.422* 0.049 -0.377* 0.038 -0.089* 0.041
Intercept............................ -0.912* 0.232 -0.859* 0.211 -6.771* 0.232
-2 Log Likelihood.................... 19,613.89 29,744.70 24,602.97
No. of Cases......................... 3,867 3,876 3,928
----------------------------------------------------------------------------------------------------------------
Across the three models, the personal and family characteristics
generally behave as one might expect. Women display higher propensities
toward service use than men and usage generally increases with U.S.
experience, the accumulation of family members in the United States,
and English language ability. In contrast, the likelihood of service
consumption is lower for other occupations compared with professionals
and among temporary and undocumented migrants. Holding these and other
effects constant, however, we continue to observe a temporal pattern
consistent with the hypothesis of a chilling effect.
Other things equal, there is a highly significant increase in the
propensity to consume U.S. public services just after IRCA's passage in
1986. Compared to a coefficient of zero before 1987 (the effective
coefficient for the reference category), the coefficient predicting
welfare use increases to 1.198 during 1987-1992 while that predicting
the use of health services rises to 0.439 and that predicting school
usage goes to 0.238. The propensity to consume social welfare and
health services remains essentially unchanged in 1993-1996, but
thereafter, the odds of service consumption fall significantly relative
to the 1987-1996 period. The coefficient predicting social welfare
usage falls from 1.184 during 1993-1996 to 0.579 during 1997-2002,
while that predicting the use of health services goes from 0.438 to
-0.212. The negative coefficient indicates that the likelihood of going
to a doctor or hospital fell to an all-time low during the period
immediately after passage of the Immigration and Welfare Reform Acts of
1996.
The decline in the likelihood of sending children to public schools
was both more gradual but also more extreme compared with the other
service usage trends. It was more gradual in the sense that elevated
usage rates did not prevail from the period 1987-1992 into 1993-1996.
Rather the coefficient predicting school usage fell from 0.238 in the
former period to 0.058 in the latter, a statistically significant
shift, and continue to proceed monotonically thereafter. The trend was
also more extreme, however, because the probability of school use fell
very sharply after 1996, with the coefficient attaining the large
negative value of -0.569. However, as with the use of health services,
the probability of using schools fell to an all-time low after 1996. In
sum, among Mexico-U.S. migrants at the turn of the century, fewer
people sought medical care and sent children to public schools than at
any point in the post-war history of Mexico-U.S. migration, and receipt
of social services was well down from its peak immediately after 1986.
determinants of financial contributions
Table 3 estimates the same basic model to predict the likelihood of
making selected contributions: paying Federal taxes (either social
security or income taxes); filing a Federal tax return; and purchasing
health insurance. In general, the control variables show that the
likelihood of making such contributions is lower for women, varies in
curvilinear fashion with age, and rises with U.S. experience, English
ability, education, and a growing number of family members in the
United States. It is generally lower for temporary and undocumented
migrants and for incumbents of nonprofessional occupations.
Table 3.--Effect of Selected Characteristics on Contributions Made by Mexican Migrants in the United States
----------------------------------------------------------------------------------------------------------------
Paid Taxes Submitted Return Health Insured
Variables ------------------------------------------------------------------------
B SE B SE B SE
----------------------------------------------------------------------------------------------------------------
Period of Trip:
<1987
1987-1992............................ -0.153* 0.039 1.147* 0.080 1.506* 0.108
1993-1996............................ -0.077 0.058 1.002* 0.098 2.026* 0.145
1997-2002............................ 0.168* 0.055 0.767* 0.094 3.263* 0.135
Personal Characteristics:
Female............................... -1.195* 0.067 -1.085* 0.014 0.157 0.137
Age.................................. 0.054* 0.008 0.050* 0.015 -0.143* 0.020
Age Squared.......................... -0.001* 0.000 0.000 0.000 0.001* 0.000
Married.............................. -0.066 0.044 -0.163* 0.076 0.487* 0.030
Speaks Some English.................. 0.204* 0.040 0.711* 0.060 0.036 0.081
Years of Schooling:
None
1-5.................................. 0.429* 0.046 0.368* 0.137 0.144 0.167
6-11................................. 0.592* 0.051 0.245* 0.116 0.116 0.161
12+.................................. 0.543* 0.073 -0.126 0.137 1.311* 0.173
U.S. Occupation:
Professional.........................
Skilled Manual....................... -1.289* 0.252 -0.126 0.243 0.489* 0.202
Unskilled Manual..................... -1.163* 0.251 0.198 0.241 -0.341 0.196
Agricultural......................... -0.854* 0.253 0.163 0.249 0.448* 0.213
Not Working.......................... -5.678* 0.282 -1.421* 0.368 -1.201* 0.327
Job Missing.......................... -0.452 0.286 1.312* 0.280 -1.502* 0.554
Family in United States:
No. of Siblings in United States..... 0.010 0.011 0.019 0.014 0.029 0.017
Parent in United States.............. 0.308* 0.044 1.502* 0.072 -0.308* 0.079
No. of Relatives in United States.... 0.009* 0.001 0.014* 0.001 -0.002* 0.001
No. of U.S.-Born Children............ 0.282* 0.026 0.381* 0.033 0.056 0.030
U.S. Experience:
No. of Prior Trips................... 0.021* 0.004 0.122* 0.008 0.063* 0.008
Duration of Last Trip................ 0.005* 0.001 0.381* 0.033 0.007* 0.001
Legal Status:
Legal or Citizen
Temporary............................ -1.066* 0.062 -0.709* 0.087 1.683* 0.116
Undocumented......................... -1.291* 0.050 -1.107* 0.068 0.515* 0.087
Intercept.............................. 1,347* 0.302 -4.235* 0.363 -2.839* 0.422
-2 Log Likelihood...................... 26,577.44 9,181.281 7,042.267
No. of Cases........................... 3,725 1,441 1,896
----------------------------------------------------------------------------------------------------------------
Once the effects of these variables are held constant, however, we
see no chilling effect in the odds of paying taxes or the purchase of
health insurance. On the contrary, if anything, Mexican migrants are
more likely to make a contribution. The odds of paying taxes, for
example, rise monotonically from 1987-1992 through 1993-1996 to 1997-
2002, with coefficients of -0.153, -0.077, and 0.138, respectively.
Likewise, the odds of being covered by health insurance also move
steadily upward, with the coefficient going from 0 before 1987, to
1.506 during 1987-1992, reaching 2.026 in 1993-1996, and peaking at
3.263 in 1997-2002. However, while the odds of filing a return hold
constant from 1987-1992 through 1992-1996, they decline significantly
in the latest period. Thus, Mexican migrants become more likely to pay
taxes and be covered by insurance, but the propensity to file tax
returns dips in the most recent period.
conclusions
Together, the declining rates of service usage combined with
increasing rates of tax payment and health insurance coverage suggest a
falling propensity for Mexican migrants to use unreimbursed social
services in the United States. We examined this hypothesis more closely
by estimating an equation to predict the odds of receiving two
unreimbursed services on the last U.S. trip. The left-hand columns of
Table 4 present coefficients from a model that predicts consumption of
unreimbursed medical services, defined as use of a doctor or hospital
but no payment by personal funds, family funds, or insurance. The
right-hand columns show coefficients from a model that predicts
unreimbursed social services, defined as receiving food stamps,
welfare, or unemployment payments but no tax withholding.
Table 4.--Effect of Selected Characteristics on the Unreimbursed Use of Public Services by Mexican Migrants in
the United States
----------------------------------------------------------------------------------------------------------------
Medical Services Social Services
Variables ------------------------------------------------
B SE B SE
----------------------------------------------------------------------------------------------------------------
Period of Trip:
<1987
1987-1992.................................................... 0.495* 0.055 0.697* 0.105
1993-1996.................................................... 0.780* 0.073 0.464* 0.156
1997-2002.................................................... 0.040 0.087 -0.848* 0.236
Personal Characteristics:
Female....................................................... 1.503* 0.067* 2.179* 0.120
Age.......................................................... -0.050* 0.009 -0.262* 0.017
Age Squared.................................................. 0.001* 0.000 0.003* 0.000
Married...................................................... 0.035 0.056 0.478* 0.103
Speaks Some English.......................................... 0.051 0.053 -0.278* 0.105
Years of Schooling:
None
1-5.......................................................... -0.570* 0.068 1.674* 0.274
6-11......................................................... -0.783* 0.071 1.291* 0.273
12+.......................................................... -0.726* 0.097 1.460* 0.296
U.S. Occupation:
Professional
Skilled Manual............................................... 1.574* 0.428
Unskilled Manual............................................. 1.607* 0.426 0.443 0.119
Agricultural................................................. 1.094* 0.430 -0.790* 0.205
Not Working.................................................. 3.465* 0.431
Job Missing.................................................. -0.227 0.538
Not Working/Job Missing...................................... NA NA 0.393 0.182
Family in United States:
No. of Siblings in United States............................. 0.067* 0.013 0.058* 0.023
Parent in United States...................................... -0.300* 0.057 -0.317* 0.102
No. of Relatives/Friends in United States.................... 0.001 0.001 0.007* 0.002
No. of U.S.-Born Children.................................... -0.036 0.025 0.214* 0.040
U.S. Experience:
No. of Prior Trips........................................... 0.031* 0.005 0.033* 0.010
Duration of Last Trip........................................ 0.001 0.000 -0.001* 0.000
Legal Status:
Legal or Citizen
Temporary.................................................... 0.083 0.087 -2.904* 0.457
Undocumented................................................. 0.745* 0.058 0.366* 0.106
Intercept...................................................... -3.433* 0.469 -1.735* 0.402
-2 Log Likelihood.............................................. 16,165.69 5,095.766
No. of Cases................................................... 3,837 3,883
----------------------------------------------------------------------------------------------------------------
As the period indicators show, the likelihood of using medical
services without paying for them increased through 1987-1992 and 1993-
1996 and then plummeted after 1996 to equal levels observed during the
period before 1987. In contrast, the use of unreimbursed social
services surged immediately post-IRCA in 1987-1992 (when the
coefficient reaches .697), then fell modestly during 1993-1996
(coefficient of .464) before dropping precipitously after the
implementation of the Immigration and Welfare Reform Acts in 1996 (to
reach -.848 in 1997-2002). In other words, our analyses clearly
indicate that Mexican migrants are less likely to make use of public
services and they are more likely to pay in some way for the services
they do use, putting the unreimbursed use of public services at levels
that are at or below historical levels.
We thus confirm Zimmerman and Fix's (1998) hypothesis of a chilling
effect in the consumption of social services. Raw trends showing
declines in service usage after 1996 are confirmed by multivariate
analyses that control for possible changes over time in characteristics
associated with service usage, such as family circumstances, U.S.
experience, socioeconomic status, and unlike prior research, legal
status. In addition, however, we have also documented rising rates in
tax payments and the purchase of health insurance. The net effect of
these two countervailing trends has been a sharp decline in the use of
unreimbursed services by Mexican migrants to the United States. These
results confirm the earlier findings of Massey and Espinosa (1997),
which suggest that migrants are not attracted to the United States by
the prospect of generous social transfers. If anything, they continue
to migrate despite steady erosion in access to services and a growing
proclivity toward the payment of taxes from which many will never
benefit.
References
Andreas, Peter J. 2000. Border Games: Policing the US-Mexico Divide.
Ithaca: Cornell University Press.
Borjas, George J. 1995. ``Immigration and Welfare: 1970-1990.''
Research in Labor Economics 14: 253-82.
__. 1996. ``The Welfare Magnet.'' National Review, March 11, pp. 48-50.
__. 1998. ``Immigration and Welfare: A Review of the Evidence.'' Pp.
121-44 in Peter J. Dunnigan and L.H. Gann, eds., The Debate in the
United States over Immigration. Stanford, CA: Hover Institution
Press.
__. 1999. ``Immigration and Welfare Magnets.'' Journal of Labor
Economics 17:607-37.
__. 2001. ``Welfare Reform and Immigration.'' Pp. 369-85 in Rebecca
Blank and Ron Haskins, eds., The New World of Welfare: An Agenda
for Reauthorization and Beyond. Washington, DC.: Brookings
Institution Press.
__. 2002. ``Immigration Reform and Immigrant Participation in Welfare
Programs.'' International Migration Review 1093-1123.
Borjas, George J. and Stephen J. Trejo. 1991. ``Immigrant Participation
in the Welfare System.'' Industrial and Labor Relations Review
44:195-211.
__. 1993. ``National Origin and Immigrant Welfare Recipiency.'' Journal
of Pacific Economics 325-44.
Borjas, George J. and Lynette Hilton. 1996. ``Immigration and the
Welfare State: Immigrant Participation in Means-Tested Entitlement
Programs.'' Quarterly Journal of Economics 575-604.
Clark, Rebecca L. 1994. The Costs of Providing Public Assistance and
Education to Immigrants. Washington, DC.: The Urban Institute.
Durand, Jorge and Douglas S. Massey. 2004. ``The Mexican Migration
Project.'' Pp. 321-38 in Jorge Durand and Douglas S. Massey, eds.,
Crossing the Border: Research from the Mexican Migration Project.
New York: Russell Sage Foundation
Fix, Michael and Wendy Zimmermann. 2004. ``The Legacy of Welfare Reform
for U.S. Immigrants.'' Pp. 337-53 in Douglas S. Massey and J.
Edward Taylor, eds., International Migration: Prospects and
Policies in a Global Market. Oxford: Oxford University Press.
Garvey, D. and Thomas. Espenshade 1996. ``Fiscal Impacts of New
Jersey's Immigrant and Native Households on State and Local
Governments: A New Approach and New Estimates.'' Office of
Population Research, Princeton University, September.
Jensen, Leif I. and Marta Tienda. 1988. ``Nativity Differentials in
Public Assistance Receipt.'' Sociological Inquiry 58:306-321.
Massey, Douglas S. 1987. ``The Ethnosurvey in Theory and Practice.''
International Migration Review 21:1498-1522.
Massey, Douglas S. and Chiara Capoferro. 2004. 2004* ``Measuring
Undocumented Migration.'' International Migration Review 38:1075-
1102.
Massey, Douglas S. and Rene Zenteno. 2000. ``A Validation of the
Ethnosurvey: The Case of Mexico-U.S. Migration.'' International
Migration Review 34:765-92.
Massey, Douglas S., Rafael Alarcon, Jorge Durand, and Humberto
Gonzalez. 1987. Return to Aztlan: The Social Process of
International Migration from Western Mexico. Berkeley: University
of California Press.
Massey, Douglas S., Jorge Durand, and Nolan J. Malone. 2002. Beyond
Smoke and Mirrors: Mexican Immigration in an Age of Economic
Integration. New York: Russell Sage.
Massey, Douglas S. and Kathleen M. Schnabel. 1983. ``Background and
Characteristics of Undocumented Hispanic Migrants to the United
States.'' Migration Today 11(1):6-13.
Rothman, E. and Thomas Espenshade 1992. ``Fiscal Impacts of Immigration
to the United States.'' Population Index 58:381-415.
Smith, James P. and Barry Edmonston, eds. 1997. The New Americans:
Economic, Demographic, and Fiscal Effects of Immigration.
Washington, DC.: National Academy Press.
Tienda, Marta and Leif I. Jensen. 1986. ``Immigration and Public
Assistance: Dispelling the Myth of Dependency.'' Social Science
Research 15:372-400.
Vernez, Georges and Kevin McCarthy. 1995. The Fiscal Costs of
Immigration: Analytical and Policy Issues. Center for Research on
Immigration Policy, RAND.
Zimmermann, Wendy and Michael Fix. 1998. Declining Immigrant
Applications for Medi-Cal and Welfare Benefits in Los Angeles
County. Washington, DC.: The Urban Institute.
Response to Questions of Senator Kennedy and Senator Sessions
by Professor Charles M. Beach
question of senator kennedy
Question. The retirement of baby-boom generation workers and the
decrease in the proportion of the working age population are causing
demographic pressures in Canada that are similar to those in the United
States. Canadian labor market conditions are already tight in low-
skilled areas like construction. Canada, however, has decided to focus
its immigration policy on skilled professionals, many of whom do not
find jobs that match the level of their qualifications. Indeed, the
Conference Board of Canada estimates underemployment affects
approximately 340,000 immigrants annually.
Doesn't this data suggest that Canada's immigration point system is
not meeting the country's needs? Isn't the Canadian government trying
to find ways to meet the unskilled labor shortage? Won't the United
States experience similar problems with such a point system?
Answer. Your observations on underemployment problems in your first
paragraph are correct. But this does not mean that we should not have a
point system. The underemployment of skilled workers I would recommend
dealing with through better language training and job matching efforts
as well as much stronger efforts to deal with local recognition of
foreign credentials and foreign work experience. For example, part of
the problem of foreign professional credential recognition is that the
latter essentially comes under provincial jurisdiction while the
immigration admission process is largely done by the Federal
Government--such jurisdictional problems may be considerably less than
in the United States. Australia, for example, now requires that foreign
professional credentials be evaluated before an immigrant arrives in
the host country. Perhaps this is an option that Canada should
consider?
So, I would say that any such problems as above should not imply
that one shouldn't have a point system to evaluate skills of immigrant
applicants, but rather do imply that the criteria we currently
incorporate in the point system should perhaps be revised so as to put
more weight on skilled tradesmen. I think it is true that the current
weighting scheme built into the Canadian point system does put perhaps
too much weight on white-collar professional skills (such as years of
education and university degrees) and not enough weight on blue-collar
tradesmen's skills. I do not think we should be letting in large
numbers of unskilled labor when the overall Canadian unemployment rate
is 6.4 percent. We should allow the market to adjust so that more
workers move from Ontario, Quebec and Atlantic Canada to Alberta and
B.C. where the shortages of unskilled workers exist. If the overall
unemployment rate were below 4 percent, say, I would be more
sympathetic to bringing in more unskilled or lower-skilled workers.
Also of a concern is that the demand for lower-skilled workers,
especially in the construction sector, is highly cyclical, and if you
bring in a lot of lower-skilled workers during the peak of the business
cycle you are then likely to have a real problem of unemployment
welfare costs when a recession hits. More generally, I would note that
a point system can be very flexible in what criteria you want to award
points to and how many points to award. Just because there are some
admitted problems in some dimensions does not mean that it is not
worthwhile having a point system at all. It can be revised and adapted
to try to deal with various problems that may come up as time goes on.
Economic and labor market conditions always change over time, and
having some flexibility in dealing with these changes is a good thing.
questions of senator sessions
Question 1a. During your testimony, you indicated that there are
many reasons for the declining rate of adjustment (assimilation) of
immigrants. However, you point out that the figures cited by Professor
Massey to illustrate the declining rate, lump both independent migrants
and other types of migrants into the same category.
Can you explain why it is important to separate these two distinct
types of immigrants when determining how fast each adjusts?
Answer 1a. It is important to separate independent (or economic)
class from other classes of immigrants such as family class and
humanitarian class because their process of adjustment and their rate
of adjustment to their new economic environment are different. In the
case of independent class immigrants, they arrive on the basis of the
skills of their principal applicant and these skills help the latter to
adjust faster to better contribute to the U.S. labor market. Those who
arrive not on the basis of their skills, have a much slower process of
adjustment that relies more on family (in the case of family class
arrivals) and public (in the case of refugees) support, and that likely
involves a much lengthier time learning the local language (English)
before they can make it well on their own.
Question 1b. Is it clear that independent migrants adjust more
quickly than other types? Please explain why you think this is true.
Answer 1b. The research evidence is quite clear--Professor Borjas
referred to it as well in his oral testimony--the independent class
immigrants to adjust more quickly than the other types. See, for
example, the papers cited on p. 4 of my research paper ``Impacts of the
Point System and Immigration Policy Levers on Skill Characteristics of
Canadian Immigrants'': Duleep and Regets (1992, 1996), Jasso and
Rosenzweig (1995), de Silva (1997), Miller (1999), Abbott and Dougherty
(2004), and Chiswick, Lee and Miller (2005, 2006) where the full source
references are listed in the References section of my above paper which
was provided to the committee staff prior to the hearing. The reason
this result is true is simply that workers with greater amounts of
skill adjust faster to the new labour market, are generally more
productive at their work, and add more to the local economy.
Question 2. Which of the three immigration policy levers you
discussed in your testimony do you consider to be the strongest single
factor in raising the average skill levels of immigrants? Why?
Answer 2. We found in our paper that the one policy lever which had
the strongest effect in raising average skill levels of immigrants as a
whole was the proportion of immigrants admitted under the point system
(ie., were skill evaluated)--that is, the fraction of all admissions
who arrive as independent class immigrants. Even if you do not bring in
a point system, you will accomplish this effect if you decrease the
proportion of (legal) immigrants coming in under the family class and
increase the fraction coming in under the employer preference class.
Interestingly, in some quite unrelated work I have been involved in
recently on analyzing the factors that influence the rate of aging of
the Canadian workforce and population, a paper by several researchers
in Ottawa using a totally different methodology (dynamic equilibrium
life-cycle micro-simulation) also found that increasing the share of
skill-evaluated immigrants had a larger effect than increasing the
required skill level within the point system itself. The reason why
increasing the skill-evaluated share has the strongest effect is simply
that it operates on such a large base of immigrants rather than just on
a (relatively small) subset of immigrants. Now if the proportion of
skill-evaluated immigrants were around 80 percent, say, this result
would probably no longer hold, and a stronger effect could be gotten
from simply raising the required skill-level for admission within the
point system itself.
Question 3a. In Canada there is a temporary seasonal program, where
workers stay for 6 to 10 months then return, which has been very
successful.
In your opinion how important is the fact that these workers must
return home on a regular basis to the overall success of the program?
Answer 3a. I consider it absolutely critical that the temporary
workers return home on a regular basis. Otherwise, they are likely to
form local attachments, settle down and start raising a family. Any
child born into the family then likely becomes a citizen of the host
country and immigration authorities are then caught between breaking up
a family and denying full citizenship rights to at least part of the
family. This then raises the social and economic problems that we have
seen blow up this past year in France, Germany and elsewhere in Europe
which we have seen played out across front pages of the world's
newspapers. The income that these temporary workers receive--
particularly agricultural workers--is low by host-country standards,
but desirably high in terms of the origin-country's living standards.
So they find it advantageous to return home with their new earnings to
support their family or start a new business back home. But if they
stay in the host country for a lengthy amount of time at such low wages
and start raising a family in the host country, economic and social
friction and possibly crime are likely to arise and the children in
such environment may well start raising problems--which is just what
has happened in Europe.
Question 3b. In your opinion what length of stay should temporary
workers be allowed? How long is too long, turning a temporary worker
into a semi-permanent or permanent worker?
Answer 3b. I do not know an exact number, but I would say no longer
than 9 or 10 months at the max. Basically, not long enough to form
permanent attachments and settle down.
Question 3c. How important to the goal of keeping the program
temporary is it that family members are not permitted to accompany the
worker for the 6- to 10-month work period in Canada? If the United
States enacts similar temporary worker programs, would you recommend
that the temporary guest workers to the United States not be allowed to
bring family with them?
Answer 3c. I am not familiar with the details of the Canadian
temporary worker program, but I would be wary of admitting full family
units under this program again because any children born while in the
host country likely acquire full rights of citizenship of the host
country and this can lead to problems as indicated above. Yes, I would
recommend that temporary guest agricultural workers to the United
States not be allowed to bring family with them. I would not recommend
this requirement for temporary skilled workers because it is
increasingly the case that skilled workers have partners who are also
skilled workers--or at least highly educated--and preventing them from
bringing their partners with them and indeed preventing their partners
from working in the United States, as well, could severely limit the
supply of skilled labor you may wish to attract, even on a temporary
basis.
Responses to Questions of Senator Kennedy by Douglas S. Massey
Question 1. Our immigration law emphasizes reunification of
families. Family members help each other adjust to their new
surroundings by pooling resources and sharing responsibilities. Strong
families help stabilize communities. And family-based immigrants, while
they have lower entry earnings, have higher earnings growth than
employment-based immigrants.
In the United States were to adopt an immigration point system
similar to that in Australia or Canada and put less emphasis on family
reunification, what do you believe would be the social and economic
consequences, both for individual immigrants and for our economy as a
whole?
Answer 1. In the United States, rates of poverty, social service
usage, and unemployment among immigrants are very low compared with
Canada. This is because families look out for their members and when
they sponsor a new immigrant they usually have jobs, housing, and other
supports lined up. As a result, family immigrants are placed quickly on
a path of work and mobility. Canada has a system that admits immigrants
based on points earned for educational and occupational credentials
without taking into account whether those credentials are actually
needed at the moment, and without considering who might support them
after their arrival if they are unable initially to get jobs in their
profession. As a result, poverty and unemployment rates among
immigrants to Canada are extraordinarily high and, in the absence of
supportive family networks, the costs to government are significant.
The same negative outcomes could be expected in the United States if it
were to change the weighting of family versus employment criteria to
favor the latter over the former.
Question 2. Economists like Alan Greenspan have made it clear that
immigration was a primary factor in America's unprecedented growth
without inflation during the 1990's. Immigrants contribute to public
coffers by paying sales, income, payroll, and property taxes. One study
has found that the net present value of immigrants' estimated future
tax payments exceed the cost of the public services they were expected
to use by $80,000 for the average immigrant and his or her dependents.
In your testimony, you mentioned that as a result of legislation in
1996, immigrants are paying more taxes and using fewer services. As a
result, you concluded that it is likely that immigrants contribute more
in taxes than they use in services.
Can you elaborate on his point? Upon what do you base your
conclusions?
Answer 2. This conclusion is based on a detailed analysis of data
from the Mexican Migration Project, which I co-direct. Funded by the
National Institutes of Health and in the field gathering data since
1982, the MMP is an award-winning project offers the most comprehensive
and reliable source of information about the behavior and
characteristics of undocumented migrants, yielding information that is
not available from any other source. The data are publicly available
from the project's Web site at http://mmp.opr.princeton.edu/. The
rising rate of tax payment and the falling use of services by both
documented and undocumented immigrants is documented in a paper
presented at the Annual Meeting of the Population Association last
spring, a copy of which is attached to this e-mail.
Question 3. Economic prosperity in the United States and Mexico are
increasingly linked. Over the past decade trade between the United
States and Mexico has nearly tripled. Mexico is America's second-
largest trading partner and we are Mexico's largest. Mexico's
president-elect has highlighted the importance of job creation and
economic development in Mexico in order to both improve economic
conditions in Mexico and to reduce illegal immigration to the United
States. An Inter-American Development Bank study suggests that
remittances from the United States reduce infant mortality and
illiteracy in Mexico while alleviating poverty and improving living
conditions.
How important for Mexico's prosperity is the permanent and
temporary migration to the United States? What would be the effects in
Mexico of reducing this migration?
Answer 3. Remittances from migrants working in the United States
now exceed $20 billion annually and represents a major source of
foreign exchange that not only contributes to Mexico's international
liquidity, but represents a major source of investment and spending
that invigorates the Mexican economy. According to estimates we
developed using MMP data and input-output multipliers estimated for the
Mexican economy, the arrival of $20 billion actually generates $65
billion in production once it has cycled through the economy. Reducing
this flow would thus cut Mexico off from a major source of capital and
income that millions of families rely upon to smooth consumption and
make investments in the absence of a strong banking sector.
Question 4. The 2000 Census reveals that one-third of all U.S. job
categories would have shrunk significantly in size during the 1990s in
the absence of recently arrived, non-citizen workers, even if all
unemployed U.S.-born workers with recent job experience in those
categories had been re-employed. Thirteen occupational categories
collectively would have been short more than 500,000 workers during the
1990s without such immigrants, making immigration a crucial component
of this country's economic well-being.
Don't you agree that immigrants contributed significantly to the
economic boom in the 1990s?
Answer 4. It is clear to me that the boom of the 1990s would have
ended sooner were it not for the labor market flexibility provided by
immigrants. During the last years of the decade unemployment rates had
fallen well below levels that economists said would be possible without
spurring inflation, and yet no inflation was occurring--despite the
fact that wages were rising. This was primarily because the input of
immigrant labor prevented labor shortages from creating productive
bottlenecks that would have driven up prices.
Response to Questions of Senator Sessions by George J. Borjas
Question 1a. Many objectives of a Nation, such as economic
objectives, social objectives, and humanitarian objectives, can be
advanced through immigration policies. These objectives must be
balanced in a way that best serves the national interest.
Canada and Australia have recently reformed their immigration
policies to give economic objectives a higher priority. They have done
this through use of a point system that evaluates the educational and
language skills of employment-based immigrant applicants. Approximately
60 percent of the annual immigration levels in Canada and Australia are
comprised of economic-based immigration. In striking contrast, only 20
percent of the immigrants in the United States each year are skill-
based immigrants that will serve our economic interests.
Would the economic national interest of the United States be better
served if we altered the percentage of employment-based admissions to
more closely reflect the 60/40 split between economic-based immigration
and family and humanitarian-based immigration, as used by other
developed nations such as Canada and Australia?
Answer 1a. There's little doubt that the net economic benefits to
the United States would increase substantially if immigration policy
were to place heavier weight on the skills of potential applicants. So
the answer to the question is an unambiguous yes.
Question 1b. Assuming the United States were to adopt a point
evaluation system for employment-based immigrant applicants, please
describe the value that each of the following items would have in such
a system. Please rank the items in order of their significance in
determining whether a future immigrant will be an economic net gain to
the economy.
i. Education
ii. Language Skills
iii. Age
iv. Job Offer in the United States
v. Prior Work Experience
vi. Spouse's Characteristics
vii. Prior Work or Study in the United States
viii. Family Members Already in the United States
Answer 1b. The ``permanent'' earnings potential of the migrant will
likely depend most on their education, language skills, and work
experience. These are the key variables that the human capital model
suggests are important determinants of earnings, and I would probably
stress those variables most in constructing any type of skills filter.
Question 2a. You agree with Professor Doug Massey, your fellow
panelist, that the family-based immigration preference for siblings is
one of the biggest factors in chain migration.
Do you agree that the United States would benefit from eliminating
the sibling preference? How so?
Answer 2a. I don't know if the word ``benefit'' is the correct word
to apply in an argument for eliminating the sibling preference. I think
the main reason for eliminating it is simply that it is the one
preference that opens up the potential for ``unrelated'' family members
to obtain entry visas. From a wider perspective, there's little reason
to believe that the sibling preference lets in less skilled workers
than the other family preferences.
Question 2b. Are there any other preferences, such as the
preference for married sons and daughters, that you think should be
changed or eliminated?
Answer 2b. I don't really have any opinion on the specific
preference for sons and daughters.
diversity visa lottery
Question 3a. What is the purpose of the diversity visa program?
Answer 3a. What is the purpose? To be completely honest: Beats me!
It is a bad idea, a bad design--a bad policy.
Question 3b. How many people applied for the 50,000 immigrant visas
available under the program in each of the last 10 years?
Answer 3b. I don't know exactly how many people have applied in
each of the past 10 years. But I've looked at the State Department
report on the Diversity Visas a few times in the past, and the numbers
are typically in the millions. I've just googled the latest information
available:
july 19, 2006--diversity visa process selects 82,000 applicants
Applicants could win one of 50,000 visas to United States.
Washington.--Approximately 82,000 people in 175 nations have
received letters from the U.S. State Department informing them that
they are eligible to apply for a permanent resident visa to the United
States.
Only 50,000 such visas are issued each year in what is known as the
Diversity Visa Lottery. More than 5.5 million people submitted entries
in the registration process held during the last quarter of 2005.
http://usinfo.state.gov/xarchives/display.html?p=washfile-
english&y=2006&m=July&x=20060719121820cmretrop
0.7058069
Question 3c. Does the diversity visa lottery program serve our
economic interests?
Answer 3c. No response.
Question 3d. Does the diversity visa lottery program serve our
family unification interests?
Answer 3d. No response.
Question 3e. In your opinion, would it be wise to eliminate the
program and use the 50,000 immigrant visas differently?
Answer 3e. No response.
Question 4a. In your testimony, you discussed that the number of
people who want to come to this country is ``way greater'' than the
number the United States can admit each year, while preserving economic
and social stability. You illustrated this truth by reminding us how
many people apply for the 50,000 immigrant visas available under the
diversity lottery program.
In your opinion, how many people should the United States admit
each year under our current immigration laws if we want to preserve
economic stability and foster the ideals of a melting pot society?
Answer 4a. I do not know precisely the ``magic number'', but it is
a number that we should probably learn by trial and error, rather than
by a legislative mandate that will stay in the books for 50 years. I
would start with a number near the average level of legal immigration
in the 1980s--which is roughly around 750,000 annually. I would suggest
a ``trial period'' for this level of immigration of 5 years, at which
time the number should be revisited and either increased or decreased
depending on economic conditions and on the observed impact of this
flow.
Question 4b. Could that number increase if current immigration laws
were altered to place a higher priority on immigrants with higher
skills, education levels, and language proficiencies?
Answer 4b. Simply because skilled immigrants benefit the country
more does not mean that we should have an unlimited number of them. A
very high number of high-skill immigrants would likely have major
impacts on the high-skill labor market. Again, I would not suggest
increasing the numbers until after we experience a trial period simply
to see and measure what the impacts are, who benefits, who loses, and
by how much.
______
Minister of Citizenship and Immigration,
Ottawa, Canada K1A 1L1
Senator Jeff Sessions,
U.S. Senate,
335 Russell Senate Office Building,
Washington DC. 20510-0104.
Dear Senator Sessions: Thank you very much for meeting with me and
my Government of Canada colleagues on June 29, 2006. It was a pleasure
to have the opportunity to share views on immigration and security
issues.
At our meeting, you indicated a particular interest in learning
more about Canada's skilled-worker selection system, which was
introduced with the new Immigration and Refugee Protection Act in June
2002. I have enclosed a short document outlining key aspects of this
program for your information.
Another topic in which you expressed interest was the performance
of recent immigrants to Canada. Historically, immigrants outperformed
Canadians in the labour market, but patterns have changed over time. In
the late 1980s, the early 1990s and early 2000s, entry earnings of
immigrants declined substantially. While our skilled worker immigrants
(selected for their labour-market suitability) continue to outperform
other immigrants and refugees, recent arrivals have faced a number of
challenges. These challenges are faced by many immigrants in all
countries. More details are included in the attachment.
I trust that you will find this information useful. Should you have
additional questions, please do not hesitate to contact me.
Sincerely,
Monte Solberg, P.C., M.P.
______
Attachment
canada's federal-skilled worker class
Canada's Federal-skilled worker class is a class of persons who are
skilled workers and who may become permanent residents on the basis of
their ability to become economically established in Canada and who
intend to reside in a province other than the Province of Quebec
(Section 75 (1) of the Immigration and Refugee Protection Regulations).
A foreign national is a member of the Quebec-skilled worker class
if he/she: intends to reside in the Province of Quebec; and, is named
in a Certificat de selection du Quebec issued to them by that Province.
To address the current and future demands of the Canadian labour
market, the criteria for the skilled worker category (in the
Immigration and Refugee Protection Act) are linked to the selection of
immigrants who are capable of adapting and contributing to an evolving
labour market. The focus is on selecting immigrants with the flexible
and transferable skills needed to succeed in a rapidly changing,
knowledge-based economy (human capital approach), rather than based on
occupation. The current criteria place emphasis on the applicants'
level of education and previous work experience, and there is
significant importance attached to their knowledge of English or
French. In addition, applicants with pre-arranged employment are
awarded extra points.
Skilled workers are assessed according to a selection grid (points
system) and have at least 1 year of work experience within the past 10
years in a management occupation, or in an occupation normally
requiring university, college or technical training (Skill Type 0 or
Skill Level A or B of Canada's National Occupational Classification).
They are expected to have enough money to support themselves and their
dependants as they settle in Canada.
In addition to the above-mentioned requirements, applicants are
assessed on a variety of selection criteria which evaluate their
ability to adapt to the Canadian economy.
------------------------------------------------------------------------
Maximum
Selection Criteria Points
------------------------------------------------------------------------
Education.................................................... 25
Official languages (English and/or French)................... 24
Employment experience........................................ 21
Age.......................................................... 10
Arranged employment in Canada................................ 10
Adaptability................................................. 10
----------
Total...................................................... 100
------------------------------------------------------------------------
To be considered under the Federal Skilled Worker category,
applicants must score a minimum of 67 out of the possible 100 points as
of September 2003. Applicants may complete a self-assessment test on-
line to determine their likely score based on the skilled-worker
selection grid.
The pass mark may be amended by the Minister to reflect changes in
the Canadian labour market, economy and society as well as the changing
demands of prospective immigrants to Canada.
As announced in the Annual Report to Parliament on Immigration in
October 2005, the target for skilled worker class immigrants (principal
applicants and family members) in 2006 is between 105,000 and 116,000.
economic performance of recent immigrants to canada
Historically, immigrants outperformed Canadians in the labour
market, but patterns have changed over time. In the late 1980s, the
early 1990s and early 2000s, entry earnings of immigrants declined
substantially. While our skilled worker immigrants (selected for their
labour market suitability) continue to outperform other immigrants and
refugees, recent arrivals have faced a number of challenges. These
challenges are faced by many immigrants in all countries.
The incidence of low-income among recent immigrants (i.e., those
who immigrated in the previous 5 years) almost doubled between 1980 and
1995, that is from 24.6 percent in 1980 to 47 percent in 1995, and then
fell to 35.8 percent in 2000 as a result of the strong economic
recovery of the late 1990s. In contrast, low-income rates among the
Canadian-born population dropped from 17.2 percent in 1980 to 14.3
percent in 2000. Thus, while recent immigrants have seen some
improvement, poverty and low-income persist.
The graphic below shows data for skilled workers who landed in
Canada from 1980 to 2002.
Entry-level earnings are defined as earnings 1 year after landing
and the data show a general trend of declining entry level earnings
over time for successive entry cohorts. Skilled workers who landed
during the 1980s could expect to earn more than the Canadian average 1
year after landing. For subsequent cohorts (1990s and into this
decade), they now earn less than the Canadian average 1 year after
landing.
Research suggests that the decline in earnings is due to a number
of factors--little or no return to foreign experience of immigrants,
declining returns to foreign education, changing source countries and
the domestic labour market situation of the 1980s and 1990s. It is also
felt that knowledge of official language may be a contributing factor
and that highly educated immigrants may not possess the fluency in
English or French needed to make full use of their education and
experience.
The most recent data show a substantial decline in immigrant
earnings for skilled workers. Some of this recent decline in earnings
appears to be related to the high-tech ``bubble'' and subsequent
``bust.'' Given that labour market conditions in the IT (information
technology) sector deteriorated after the ``bust'' in 2001, it is
reasonable to assume that fewer new workers (including immigrants) have
been able to secure employment in the high paying IT sector.
Consequently, immigrants may be working in lower-skilled occupations
and generally lower-paying occupations to secure entry into the labour
market. It should be noted that over 50 percent of skilled workers who
landed during the early 2000s intended to work in the natural and
applied science field (a sector highly concentrated with IT workers).
However, earnings of skilled workers consistently outperform the
Canadian average 5 years after landing. The earnings profile of
selected landing year cohorts is also shown in the graphic above and a
steady increase is a common characteristic for all cohorts, regardless
of their initial earnings.
Australia's Skilled Migration Program
Australia adminsters separate Migration and Humanitarian Programs.
The Programs provide a balance between Australia's international
humanitarian obligations and the Government's economic, social and
environmental objectives.
The Migration Program has two main streams, a Skill Stream that
targets skills and skill shortages that contribute to Australia's
economy and a Family Stream that recognizes the importance of family
migration to Australia's social and economic goals.
In 2005-2006 program year the Migration Program outcome was
143,000. The family composition was 45,000 and skilled migration
category was 97,500.
The Skill Steam has two broad categories. General Skilled Migration
for people with skills in particular occupations required in Australia
and Employer Sponsored Migration for people with recognised skills
seeking to work in Australia sponsored by an Australian or overseas
employer.
general skilled migration
In this category, an applicant can migrate as a skilled person
independently, or can be sponsored by an eligible Australian relative
or State/Territory government. Visa applications may be made whilst in
Australia, or from outside Australia.
Basic requirements.--General skilled migration applicants must be
able to meet several basic requirements: age (under 45 years old),
English language, qualifications (post-high school qualifications) and
an assessment of skills, a nominated occupation (on an approved list of
occupations) and recent work experience (a minimum of 12 in the 18
months before applying).
Points test.--In addition to meeting the basic requirements, most
General Skilled Migration visas require assessment against a ``points
test'' and obtaining a pass mark.
Operation of the points test.--Points are awarded for a range of
different factors--age, skill, English language ability, specific work
experience, for an occupation in demand and a job offer, Australian
qualifications, spouse skills, family relationship with an Australian,
living and studying in regional or low population growth metropolitan
area in Australia.
Pass mark.--The pass mark varies for different visas, but
independent migrants need to score the highest pass mark, currently 120
points. For an independent applicant who achieve a score below the
required pass mark, but above another mark (the `pool' mark) the
application will be held in reserve for up to 2 years. If the pass mark
is lowered, the application will be further processed.
employer sponsored migration
Employers are able to sponsor suitably qualified and experienced
people for permanent residence. The employer-sponsored temporary
residence visa is providing an increasingly popular pathway to
permanent residence, with streamlined procedures when the person to be
sponsored is already working for an employer.
General requirements for this category of migration include: age
(under 45 unless exceptional circumstances apply), appropriate English
language ability, qualifications assessed as being equivalent to the
Australian standard for the position, or a designated period of work
experience in Australia (2 years) or a base salary of $A160,000.
There is no points test for this category of visas.
regional-sponsored migration program
The Australian Government works closely with State, territory and
local governments, and regional authorities to support regional
development and help supply the skill needs of regional employers. It
aims to attract young, skilled, English speaking migrants to areas of
Australia where they are most needed.
All areas of Australia are included, except the main metropolitan
areas including Brisbane, the Gold Coast, and Sydney.
The relevant State or Territory Government must certify an
employer's nomination to fill the position and the employer's
nomination is assessed to ensure that it has been certified, that the
position complies with Australia's stands and workplace legislation for
wages and working conditions.
australian-government skilled migration priorities
The first priority is to target employer sponsored migrants, who
move straight into jobs where there is a direct and clear need for
their skills.
The second priority is to target migrants who have been sponsored
by States and Territories as they are best placed to identify the skill
needs of their cities and regions.
The third priority is to target migrants who have an occupation on
an expanded and more responsive Migration Occupations in Demand List
(MODL). The MODL is an inherent element of the points test.
While priority was given to employer and State/territory-sponsored
migrants in the 2005-2006 Program, the General Skilled Migration visa
categories remain critically important as the major route to skilled
migration in Australia in the immediate future.
economics of skilled migration
Skilled migrants have a positive impact on Australian living
standards and a highly beneficial impact on Commonwealth and State
budgets.
Unemployment rates for migrants are closely related to proficiency
in English, age skill level and qualifications.
Research shows that the employment rates for recently arrived
migrants are better now than 6 years earlier.
General Skilled Migration
what is the points test?
For most General-Skilled Migration visas, your application will be
assessed against a points test. You can claim points under a range of
different factors. The maximum points that can be claimed in any one
factor reflects how sought after those characteristics are in the
Australian labour market.
what is the pass mark?
The pass mark is the total points you need to score to be eligible
for a points-tested General Skilled Migration visa.
what happens if you don't meet the pass mark?
If you score below the pass mark, but above the ``pool mark,'' your
application will be held ``in the pool'' for up to 2 years after
assessment.
If the pass mark is lowered at any time in that 2-year period, and
your score is equal to or higher than the new pass mark, your
application will be processed further.
Apart from waiting in the pool, there are four other visa options
you could consider if you do not meet the pass mark:
1. If you score 110 points you may be eligible for a Skilled-
Independent Regional (Provisional) (subclass 495) visa. See: Skilled-
Independent Regional (subclass 495) visa.
2. If you meet the pool mark for the Skilled-Independent (subclass
136) visa, you can still lodge and register for the Skill Matching
Database. More information on Skill Matching is available. See: Skill
Matching Database
3. If you are under 45 years of age, have Functional English and a
degree, diploma or trade qualification, you can apply for a Skill
Matching (subclass 134) visa with no initial charge. Applicants are
registered on the Skill Matching Database and may be nominated by a
State or Territory government for a Skilled Matching (subclass 134)
visa, or sponsored by an employer under the Regional Sponsored
Migration Scheme.
This category is not points-tested. See: Skill Matching (subclass
134) visa
4. You may wish to apply for either the Skilled-Designated Area
Sponsored (Provisional) (subclass 496) visa or the Skilled-Designated
Area Sponsored Overseas Student (subclass 882) visa if you:
are under 45 years of age;
have functional English;
have a degree, diploma or trade qualification; or
have a relative, as distant as a first cousin, living in
a designated area in Australia, who is willing and able to sponsor you.
These visas are not points-tested. See: Skilled-Designated Area
Sponsored (Provisional) (subclass 496) visa; Skilled-Designated Area
Sponsored Overseas Student (subclass 882) visa
what are the current pass and pool marks?
The table below lists all the current pass and pool marks for the
points-tested visas in the General Skilled Migration category.
------------------------------------------------------------------------
Current Current
Category pass pool
mark mark
------------------------------------------------------------------------
Skilled-Independent (subclass 136) visa............... 120 70
Skilled-Independent Regional (subclass 495) visa...... 110 110
Skilled-Australian Sponsored (subclass 138) visa...... 110 105
Skilled-Independent Overseas Student (subclass 880) 120 120
visa.................................................
Skilled-Australian Sponsored Overseas Student 110 110
(subclass 881) visa..................................
Skilled-Onshore Independent New Zealand Citizen 120 120
(subclass 861) visa..................................
Skilled-Onshore Australian Sponsored New Zealand 110 110
Citizen (subclass 862)...............................
------------------------------------------------------------------------
how often do the pass and pool marks change?
Changes to the pass and pool marks occur to address Australian
labour market needs.
You should check the current pass mark immediately before making an
application. You will be assessed against the pass and pool mark that
is in effect on the day you make your application.
FACT SHEETS
20. Migration Program Planning Levels in Australia
Australia's permanent immigration program has two components--
Migration, for Skilled, Family and Special Eligibility Stream migrants
and Humanitarian, for refugees and others with humanitarian needs.
On May 1, 2006, the Minister for Immigration and Multicultural
Affairs, Senator Amanda Vanstone, announced the Migration Programme and
Humanitarian Programme planning levels for the 2006-2007 year--134,000
to 144,000 under the Migration Programme, and 13,000 in the
Humanitarian Programme.
This maintains the Government's commitment to an immigration policy
which seeks to balance social, economic, humanitarian and environmental
objectives.
humanitarian programme
The Humanitarian Program comprises:
Refugees from overseas--6,000 places.
Special Humanitarian Program--over 7,000 places (this
includes places required for onshore needs).
Further details are provided in Fact Sheet 60. See: Australia's
Refugee and Humanitarian Program
migration programme
The 2006-2007 Migration Programme provides up to 144,000 places,
comprising:
46,000 places for family migrants who are sponsored by
family members already in Australia;
97,500 places for skilled migrants who gain entry
essentially because of their work or business skills; and
500 places for special eligibility migrants and persons
who applied under the Resolution of Status category and have lived in
Australia for 10 years.
The skill balance of the programme has been maintained with 67.7
percent of places in the Skill Stream.
programme range
The Programme will be delivered at the upper or lower end of the
range depending on:
application rates in demand-driven categories such as
partners, children and employer-nominated and business categories;
the take-up of State-specific and regional migration
categories to achieve a better dispersal of the intake;
the extent of national skill shortages and the ability to
attract migrants to these; and
the availability of high standard applicants in the
skilled categories.
caps
The delivery of a balanced Migration Programme may require caps (or
limits) to be placed on Parent or Other Family visa subclasses.
Further details are provided in Fact Sheet 21. See: Managing the
Migration Program
The following table sets out the Migration Programme planning
levels for 2005-2006 and 2006-2007. See: Migration Programme Planning
Levels
Further information is available on the department Web site. See:
http://www.immi.gov.au
The department also operates a 24-hour national telephone service
inquiry on line, 131 881 for the cost of a local call anywhere in
Australia.
Fact Sheet 20, produced by the National Communications Branch,
Department of Immigration and Multicultural Affairs, Canberra.
Revised 17 July 2006.
Commonwealth of Australia 2006.
Migration (Non-Humanitarian) Program 2005-2006 and 2006-2007
------------------------------------------------------------------------
2005-2006 2006-2007
Category Planning Levels Planning Levels
Top of Range Top of Range
------------------------------------------------------------------------
Partner \1\....................... 36,300 \2\ 37,300
Child \3\......................... 2,500 2,500
Preferential/Other Family \4\..... 1,700 1,700
Parent \5\........................ 4,500 4,500
-------------------------------------
Total Family.................... 45,000 46,000
-------------------------------------
Employer Sponsored \6\............ 15,000 15,000
Skilled Independent............... 49,200 49,200
State/Regional Sponsored \7\...... 10,000 10,000
Skilled Australian Sponsored \8\.. 17,700 17,700
Distinguished Talent.............. 200 200
Business Skills \9\............... 5,400 5,400
-------------------------------------
Total Skill..................... 97,500 97,500
Skill as Percent of Total 69.2 67.7
Programme........................
-------------------------------------
Total Special Eligibility....... 500 500
-------------------------------------
Programme Planning Range........ 133,000-143,000 134,000-144,000
------------------------------------------------------------------------
Note: Migration Programme numbers do not include New Zealand citizens or
holders of Secondary Movement Offshore Entry (Temporary), Secondary
Movement Relocation (Temporary) and Temporary Protection Visas and are
detailed at the top of planning range.
\1\ Includes spouse, fiance and interdependent. Net outcome as places
taken by provisional visa holders who do not subsequently obtain
permanent visas are returned to the Migration Programme in the year
that the temporary visas expire.
\2\ An increase of 3000 partner places for 2005-2006 was agreed by
government in March 2006.
\3\ Includes child-adoption, child dependent and orphan minor.
\4\ Includes aged dependent, carer, orphan, unmarried and remaining
relatives.
\5\ Includes designated, contributory and non-contributory parents.
\6\ Includes brothers, sisters, nieces, nephews, nondependent children,
working age parents, grandchildren and first cousins who have skilled
tested.
\7\ Includes State/Territory Nominated Independent Scheme and Skilled
Independent Regional.
\8\ Includes brothers, sisters, nieces, nephews, nondependent children,
working age parents, grandchildren and first cousins who have been
skill tested.
24. Overview of Skilled Migration to Australia
The Skill Stream of Australia's Migration (non-humanitarian)
Program is specifically designed to target migrants who have skills or
outstanding abilities that will contribute to the Australian economy.
The Australian Government continues to emphasize skilled migration,
while maintaining a commitment to family reunion migration. The
migration to Australia of people with qualifications and relevant work
experience addresses specific skill shortages in Australia and enhances
the size, skill level and ``employability'' factor of the Australian
labour force.
The numbers of migrants arriving under the Skill stream has risen
from 71,240 in 2003-2004 to 77,880 in 2004-2005.
In 2004-2005 the Skill Stream represented about 65 percent of the
Migration Program, an increase from 62.3 percent in 2003-2004.
About 18,700 visas were granted under the State Specific and
Regional Migration (SSRM) mechanisms in 2004-2005, almost a 50 percent
increase on 2003-2004.
An additional 20,000 places has been allocated to the Skill Stream
for the program year 2005-2006. The 20,000 additional places will be
targeted at:
employer sponsored migration;
state/territory government sponsored applications; and
applicants who nominate an occupation which is on the
Migration Occupations in Demand List (MODL).
skilled stream categories
There are five main categories of skilled migrants:
1. Independent Migrants
Independent migrants are selected on the basis of their age,
skills, qualifications, English language ability and employability so
that they can contribute quickly to the Australian economy.
They are not sponsored by an employer or relative in Australia.
This group forms the largest component of skilled migrants each
year.
For example, in 2004-2005, 41,180 independent visas were granted
(including family members), representing 52 percent of the Skill
Stream. See Fact Sheet 25, Skilled Categories, for more information.
State/Territory Scheme.--The State/Territory Nominated Independent
(STNI) Scheme enables State and territory governments to sponsor
skilled migrants and their families in the Independent skilled
category. For more details, see Fact Sheet 26, State/Territory Specific
Migration.
2. Employer Nomination
Employers may nominate (or ``sponsor'') personnel from overseas
through the following categories:
The Employer Nomination Scheme (ENS) allows Australian
employers to nominate workers from overseas for permanent entry to
Australia when a position cannot be filled from within the local
workforce.
The Regional Sponsored Migration Scheme (RSMS) enables
employers in regional and low population growth areas of Australia to
fill skilled vacancies that they have been unable to fill through the
local labour market.
The RSMS is one of several government initiatives designed to help
State and territory governments in their efforts to boost development
in regional Australia and less populated States/territories.
A Labour Agreement enables Australian employers to recruit
a specified number of workers from overseas in response to identified
or emerging labour market (or skill) shortages. This is a formal
arrangement negotiated between the Commonwealth Government and the
employer or industrial association.
In 2004-2005, 13,020 permanent residence visas were
granted for Employer Nomination, RSMS and Labour Agreements. See also
Fact Sheet 48--Assisting Skilled and Business People.
3. Business Skills Migration
The Business Skills program encourages successful business people
to settle permanently in Australia and develop new business
opportunities.
In 2004-2005, 4,820 business migration visas were granted to
business people and their families. For more details, see Fact Sheet
27, Business Skills Migration.
4. Distinguished Talent
This is a small category for distinguished individuals with special
or unique talents of benefit to Australia.
The profiles of people who have been successful under this category
generally include sports people, musicians, artists and designers, all
of whom were internationally recognized as outstanding in their field.
In 2004-2005, 190 visas (including family members) were granted under
this category.
5. Skilled Australian Sponsored
Skilled-Australian Sponsored category migrants are selected on the
basis of their age, skills, qualifications, English language ability
and family relationship. They must be sponsored by a relative already
living in Australia.
In 2004-2005, 14,530 visas were granted under this category. See
Fact Sheet 25, Skilled Categories, for more detail.
Further information is available on the department Web site: http:
///www.immi.gov.au/media/fact-sheets/24overview_skilled.htm.
The department also operates a 24-hour national telephone service
inquiry line, 131 881 for the cost of a local call from anywhere in
Australia.
Fact Sheet 24, produced by the National Communications Branch,
Department of Immigration and Multicultural Affairs, Canberra.
Revised July 20, 2006.
Commonwealth of Australia 2005.
25. Skilled Categories
This fact sheet provides an overview of the requirements to be met
by applicants for the General Skilled Migration (GSM) visa categories,
which is one part of Australia's Skilled Migration Program.
For an overview of the other categories within the Skill stream of
Australia's Migration Program, see Fact Sheet 24--Overview of Skilled
Migration.
More detailed information on the requirements and procedures for
GSM visa applicants can be found on the department's Web site:
www.immi.gov.au/skilled/general-skilled-migration/index.htm.
Australia's General Skilled Migration program is designed to
attract young, highly skilled people, with a high level of English
language ability who have skills in particular occupations that are
required in Australia. These occupations are listed on Australia's
Skilled Occupation List (SOL) which is available on the department's
Web site, see Form 1121i.
People applying for a General Skilled Migration visa will need to:
be under 45 years of age at the time they apply (unless
they have been invited to apply for a General Skilled Migration visa);
have an occupation listed on the SOL;
have their skills assessed as being suitable for this
occupation by an organisation in Australia, known as the Relevant
Assessing Authority;
have a high level of English;
have recent skilled work experience or have recently
completed an Australian qualification as the result of 2 years full-
time study in Australia (required if applicant is applying from within
Australia); and
where applicable, meet the relevant passmark when assessed
against the GSM points test.
There are several types of visa classes within the GSM category.
Skilled-Independent for people who do not have an Australian
sponsor. Applicants must be outside Australia for the visa to be
granted.
Skilled-Independent Overseas Student for holders of an eligible
student visa in Australia who have recently completed an Australian
qualification.
Skilled-Independent Regional (Provisional) for people who are
sponsored by a State or territory government agency and who are willing
to live and work in regional Australia or a low-population growth
metropolitan centre for at least 2 years.
Skilled-Australian Sponsored for those who are sponsored by an
Australian relative and have an assurer.
Skilled-Designated Area Sponsored for those who are sponsored by an
Australian relative who lives in a designated area and who have an
assurer.
Skill Matching for people who meet the basic requirements for GSM
but do not have the required period of work experience and English
language ability. This visa can only be granted whilst the applicant is
outside Australia.
Skill Matching visa applicants' details may be placed on a Skill
Matching Database which is distributed to State and territory
governments and some regional authorities who may then nominate an
applicant for migration.
Points Test
For GSM categories, with the exception of the Skilled-Designated
Area Sponsored and the Skill Matching visa classes, applicants must
pass a points test.
Applicants are awarded points for:
Skill
Age
English language ability
Specific work experience
Occupation in demand (and job offer)
Australian qualifications
Study and residence in regional Australia/low population
growth metropolitan areas
Spouse skills
Relationship (for Skilled-Australian sponsored visa
applicants only)
State/territory sponsorship (for Skilled-Independent
Regional visa applicants only)
Applicants may also receive bonus points for one of the following:
Capital investment in Australia; or
Australian work experience; or
Fluency in one of Australia's community languages (other
than English).
Applications which achieve a score below the passmark (but above
another mark, known as the pool mark) will be held in reserve for up to
2 years after it is assessed. If the passmark is lowered during this
period and the applicant's score is at, or above, the new passmark, the
application will proceed. If it is not, then the application will be
refused.
The pass mark changes from time to time. Applicants should check
the department's Web site at http://www.immi.gov.au/skilled/general-
skilled-migration/points-test.htm for the current passmark.
Assurance of Support
An Assurance of Support (AOS) is an undertaking to provide
financial support to the person applying to migrate.
Applicants applying for migration under the Skilled-Designated Area
Sponsored or Skilled-Australian Sponsored categories must provide an
AOS. Applicants applying under other General Skilled Migration
categories may be requested to provide an AOS if it is determined that
they are likely to access social security benefits within 2 years after
their arrival to Australia. For more details, see Fact Sheet 34--
Assurance of Support.
Online Lodgement
Applicants for a GSM visa that can be granted while in Australia,
or an ``offshore'' Skilled-Independent Regional (Provisional) visa, can
submit their visa application over the Internet.
The eVisa facility provides the following services:
Internet visa lodgement
Internet payment facilities using credit card
electronic document attachment facility
facility to check the status of an application online
Information on online lodgement is available at: http:/
//www.immi.gov.au/e_visa/general-skilled-migration.htm.
Further information is available on the departments Web site:
http://www.immi.gov.au.
The department also operates a 24-hour national telephone service
inquiry line, 131 881 for the cost of a local call from anywhere in
Australia.
Fact Sheet 25, produced by the National Communications Branch,
Department of Immigration and Multicultural Affairs, Canberra.
Revised 9 August 2005.
Commonwealth of Australia 2005.
Federal-Skilled Worker Selection Grid
------------------------------------------------------------------------
Maximum
Education 25
------------------------------------------------------------------------
University Degrees:
Ph.D., or Masters AND at least 17 years of completed full- 25
time or full-time equivalent study........................
a two or more university degrees at the Bachelor's level 22
AND at least 15 years of completed full-time or full-time
equivalent study..........................................
2-year university degree AND at least 14 years of completed 20
full-time or full-time equivalent study...................
a 1-year university degree AND at least 13 years of 15
completed full-time or full-time equivalent study.........
Trade or nonuniversity certificate or diploma:
a 3-year diploma, trade certificate or apprenticeship \1\ 22
AND at least 15 years of completed full-time or full-time
equivalent study..........................................
a 2-year diploma, trade certificate or apprenticeship AND 20
at least 14 years of completed full-time or full-time
equivalent study..........................................
a 1-year diploma, trade certificate or apprenticeship AND 15
at least 13 years of completed full-time or full-time
equivalent study..........................................
A 1-year diploma, trade certificate or apprenticeship AND 12
at least 12 years of completed full-time or full-time
equivalent study..........................................
High school Diploma:
Secondary school educational credential.................... 5
------------------------------------------------------------------------
------------------------------------------------------------------------
Official Languages Maximum 24
------------------------------------------------------------------------
1st Official language High proficiency 4
(per ability \2\).
Moderate 2
proficiency (per
ability).
Basic proficiency 1 to maximum of 2
(per ability).
No proficiency.... 0
Possible maximum 16
(all 4 abilities).
2nd Official language High proficiency 2
(per ability).
Moderate 2
proficiency (per
ability).
Basic proficiency 1 to maximum of 2
(per ability).
No proficiency.... 0
Possible maximum 8
(all 4 abilities).
------------------------------------------------------------------------
------------------------------------------------------------------------
Maximum
Experience 21
------------------------------------------------------------------------
1 year....................................................... 15
2 years...................................................... 17
3 years...................................................... 19
4 years...................................................... 21
------------------------------------------------------------------------
------------------------------------------------------------------------
Maximum
Age 10
------------------------------------------------------------------------
21-49 years at time of application........................... 10
Less 2 points for each year over 49 or under 21
------------------------------------------------------------------------
------------------------------------------------------------------------
Maximum
Arranged Employment in Canada 10
------------------------------------------------------------------------
HRSDC confirmed permanent offer of employment................ 10
Applicants from within Canada and holding a temporary work
permit that is:
HRSDC opinion obtained, including sectoral confirmations... 10
HRSDC opinion exempt under an international agreement, 10
significant benefit (e.g. intracompany transferee) or
public policy (e.g. post-graduate work)...................
------------------------------------------------------------------------
------------------------------------------------------------------------
Maximum
Adaptability 10
------------------------------------------------------------------------
Spouse's/common-law partner's education...................... 3-5
Minimum 1-year full-time authorized work in Canada \3\....... 5
Minimum 2-year full-time authorized post-secondary study in 5
Canada \3\..................................................
Have received points under the Arranged Employment in Canada 5
factor......................................................
Family relationship in Canada \3\............................ 5
----------
Total...................................................... Maximum
100
------------------------------------------------------------------------
Pass mark as of September 18, 2003: 67 points
------------------------------------------------------------------------
\1\ ``Diploma, trade certificate or apprenticeship'' refers to a post-
secondary educational credential other than a university educational
credential.
\2\ Applicants are rated on the ability to speak, listen, read or write
Canada's two official languages.
\3\ Applies to either principal applicant or accompanying spouse/common-
law partner.
HRSDC: Human Resources and Skills Development Canada.
[Whereupon, at 12:29 p.m., the hearing was adjourned.]