why America’s seemingly “booming” jobs recovery, which is “firing on all fours” according to the BLS, is not manifesting itself in either inflationary pressures [i.e. due to wage growth], or broad economic productivity.
The discovery is that the vast bulk of recent job growth has gone to immigrants, including illegal immigrants who have little power to ask for raises. Specifically, since the start of the 2007 Great Recession “the US has added 2.3 million “foreign-born” workers”, but only 727,000 “native born.” (This is according to the Bureau of Labor Statistics’ own survey.)
This means that the “recovery” has almost entirely benefited foreign-born workers, to the tune fo 3 to 1 relative to native-born Americans! [Boldface not added!]
It would also explain why the politics of the “jobs recovery” is so problematic for Democrats. Disproportionately, voters ain’t ‘feeling it.’ (Plenty of foreign born workers are also voters, but the percentage who are has to be lower than that for native-born workers.)
Durden says he’s not taking sides in the immigration debate, just trying to “fill a gaping hole in economist models.” …
P.S.: At first I thought Durden’s theory required there to have been a huge surge of new immigration (which, maybe, there has been). But it merely requires that foreign born workers, who may already have been in the U.S., get the lion’s share of new jobs. … Nor am I completely clear on why foreign-born labor would produce low labor productivity, unless the argument is that with so much cheap labor employers don’t have to make productivity-enhancing improvements. …
P.P.S.: We will now attempt to insert a dramatiic graph from Durden’s post: