Issue Du Jour: Immigration And The Restaurant Industry

This has not yet metastasized into a full thought for us, but we do have a musing about the latest immigration bill that’s currently being hashed out in Congress. The bill calls for a guest worker program based on job skills and education, and work visas would be sponsored by the government instead of by individual businesses. This seems like a somewhat odd choice for a government that otherwise does not generally regulate how people seek employment. Under the current system, businesses can sponsor immigrants if they have job skills that the company needs which cannot be filled by the current U.S. labor poor. Under the new scheme, it appears as though the government will be determining the job skills that the country as a whole needs, and furthermore, in what proportion they’re needed. This nationalization of the immigrant labor pool is not sitting well with employers, who are worried that they are not going to be able to secure the type and amount of labor that they need when they need it. That point was driven home to us when we received a press release in which the National Council of Chain Restaurants and the National Restaurant Association react fearfully to the new legislation, citing problems with the proposed electronic work eligibility verification system and with the guest worker program’s emphasis on skilled labor.

Why might the restaurant industry be so concerned about those provisions in the immigration bill? The fact that restaurants are the “No. 1 employer of immigrants,” according to the National Restaurant Association via the NYTimes, but almost certainly not the top employer of skilled immigrant labor, sheds some light on the industry’s fears: that they are being squeezed by a shortage of legal non-skilled immigrant labor, and a curtailment of illegal non-skilled labor owing to the proposed eligibility verification system, among other factors. Basically, the industry is forecasting severe labor shortages as the non-skilled immigrant labor pool shrinks and becomes inaccessible. If the bill passes in its current form (which it probably won’t), restaurants are going to have to come up with other tactics to meet their labor demands - either go way off the books with illegal immigrants and hope they don’t get shut down by the government, or…raise wages. One sure-fire way to get people to work for you is to pay them well. At sufficiently high wages, the restaurant industry would vastly expand its potential labor pool to include (gasp!) native-born Americans, who have avoided many types of restaurant jobs because they’re crappy, exhausting, and non-remunerative.

The outcome of this is that prices at restaurants will probably go up. But if prices were kept artificially low through the economic exploitation of non-papered immigrant laborers, we won’t really mind the correction. By the way, we know this analysis is reductive, because no industry (or labor pool) operates in a vacuum. That’s why we called it a musing. Were you amused? Tell us.

After Aiding Bill on Immigration, Employers Balk [NYTimes]

Industry leaders express concerns about new immigration proposal [NRN]

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Issue Du Jour: Immigration And The Restaurant Industry