Economists and politicians hailed Friday’s jobs report as a howling success with both the Bureau of Labor Statistic’s Establishment report and Household survey showing over 280,000 jobs created in the past month far above expectations of 215,000.
However, the folks at Zero Hedge dug into the BLS data sets a little closer than the mainstream media cheerleaders did and found something very interesting.
The number of foreign born workers used in the Household survey jumped to 25.098 million, the 2nd highest in history and a jump of 279,000 in May.
In other words, of the 280,000 jobs created in May, 1,000 went to native-born Americans and 279,000 went to foreign born.
Now, this is a crude method of determining actual job creation so they dug a little deeper.
using the BLS’ own Native-Born series, also presented on an unadjusted basis, we find the following stunner: since the start of the Second Great Depression, the US has added 2.3 million “foreign-born” workers, offset by just 727K “native-born”.
This means that the “recovery” has almost entirely benefited foreign-born workers, to the tune of 3 to 1 relative to native-born Americans!
According to the BLS, this includes illegal immigrants as well as legal immigrants.
How does the BLS determine a foreign-born worker? This is its definition:
The foreign born are persons who reside in the United States but who were born outside the country or one of its outlying areas to parents who were not U.S. citizens. The foreign born include legally-admitted immigrants, refugees, temporary residents such as students and temporary workers, and undocumented immigrants. The survey data, however, do not separately identify the numbers of persons in these categories.
In other words, the “foreign-born” category includes both legal and illegal immigrants unfortunately, the BLS is unable, or unwilling, to distinguish between the two.
Economists have been baffled as to why wage growth has lagged behind both productivity growth and economic growth for the last few years.
As a result, it may well be, that the surprise answer why America’s labor productivity (which recently posted its worst 6 month stretch in 22 years) has plummeted in recent years and certainly months, confounding economists who are unable to explain why “solid” labor growth does not translate into just as solid GDP growth.
And why wage growth has gone precisely nowhere, is because the vast majority of all jobs since December 2007, or 75% to be specific, have gone to foreign-born workers, a verifiable fact.What is unknown is how many of these millions of “foreign-born” jobs have gone to illegal immigrant who are perfectly willing to work hard, and yet whose wage bargaining power is absolutely nil (after all they are happy just to have a job) thereby leading to depressed wages for native-born workers in comparable jobs, resulting in wage growth which over the past 8 years has been non-existent.
Given these facts, the eternal political question surrounding illegal immigration (Who benefits?) can then be answered
In other words, how many illegal workers cross the US border, may be the biggest variable shaping US monetary policy at the moment! And, in thought-experiment land, the more porous US immigration policy the longer the Fed will be allowed to maintain its ZIRP/QE experiment, and the higher the S&P will rise.
Could it be that illegal immigration is the best friend of that 0.1% of the US population which has benefited exclusively from the Fed’s relentless injection of liquidity into risk assets via either ZIRP of QE?
