On storefronts throughout the U.S., “Help Wanted” signs have become about as ubiquitous as the stars and stripes. Today, there are roughly two job openings for every unemployed American.
This historic labor shortage is propping up inflation as desperate employers raise wages to attract scarce workers, then boost prices to compensate for higher costs. Or at least this is what the U.S.’s top economic policy-makers believe.
Meanwhile in Central America, gainful employment is hard to come by. Before the pandemic, 30 million people in the region were living in poverty, according to the Georgetown Journal of International Affairs. In much of Central America, material deprivation is even more profound today — the area’s growth rate fell by 10.3 percent in 2020. Amid rising economic desperation, the number of Central Americans interested in migrating internationally skyrocketed from 8 percent in 2019 to 43 percent in 2021, according to a report from the World Food Programme, Migration Policy Institute, and Civic Data Design Lab.
So in one part of the western hemisphere, there are too many well-paying jobs and too few workers. In another, there are too many workers and few good jobs. As a result, people in Central America are eager to seek work internationally.
On paper, this does not look like a difficult policy problem to solve. A precocious grade-schooler wouldn’t need much time to ascertain the basic answer: If the U.S. expands immigration opportunities for international workers, our labor shortage and Central Americans’ economic woes should ease simultaneously. After all, there is no “skills” mismatch between economically desperate Central Americans and open U.S. positions. The U.S.’s labor shortage is concentrated in fields that do not require an extensive education. The U.S. needs more kitchen staff, construction workers, and delivery drivers. Central America is home to a large number of people with the interest in and capacity to perform those roles. Opportunities for “win-win” policy-making are rarely so clear-cut.
Yet U.S. policy-makers refuse to take the win. Instead, their answer to the twin problems of a U.S. labor shortage and Central American poverty crisis is, effectively, as follows: To close the gap between job openings and available workers, the Federal Reserve will simply raise interest rates until a critical mass of Americans become too poor to afford discretionary purchases, demand for labor drops, and, in all probability, the U.S. enters a recession. Meanwhile, to mitigate the poverty of those to our south, the U.S. has been allowing Central American children to enter our country, work illegally at brutal jobs, then send remittances home to their adult family members. Specifically, we have decided to let Central American kids do this if — and only if — they embark on a roughly 2,000-mile journey to the U.S. border without a parent or guardian.
The first prong of this policy is open and intentional. The Federal Reserve has made no secret of its belief that beating inflation will require killing jobs and lowering wages. The second prong is a different story. U.S. officials have stumbled into what is in essence a child-labor trafficking policy, the cruelty and irrationality of which derive from negligence rather than intention.
Over the weekend, the New York Times published an investigation into the U.S.’s vast shadow workforce of child-migrant laborers. The paper uncovered stories of teenage roofers in Florida, delivery workers in New York City, and hotel maids in Virginia. Throughout every state in the union, across a wide variety of industries, minors from Central America are performing some of the most brutal jobs in the economy — in defiance of child labor laws. In some cases, these children were lured into the U.S. by de facto child-labor brokers who promised them comfortable homes and good schools — only to shunt the minors into 12-hour shifts, demanding that they pay back the cost of their passage.
In other instances, children have come to the U.S. with the intention of becoming full-time workers so that they can send money to their hungry families back home. This is, of course, an inversion of the conventional relationship between parents and children in the context of labor migration. (Typically, it is the adult who takes on the hazards of traveling thousands of miles, and the burdens of hard labor, in order to secure income for their kids.) But the U.S.’s disordered patchwork of immigration laws has rendered the opposite arrangement more feasible for many families.
In 2008, Congress passed the William Wilberforce Trafficking Victims Protection Reauthorization Act. As its name suggests, the law was intended to assist the victims of sex trafficking and, therefore, provide broad protections for children who enter the U.S. without a legal guardian (from countries other than Mexico and Canada). Under the law, such migrants are given extensive due-process rights before becoming subject to removal from the country. For this reason, even in cases where migrants are ultimately denied residence in the U.S., it typically takes several years for legal proceedings to reach that conclusion. In the meantime, the law puts the minors in the care of the Department of Health and Human Services, which is directed to place the children “in the least restrictive setting that is in the best interest of the child” and seek to unite them with family members.
All of this makes it much easier for unaccompanied minors than it would be for parents to secure a foothold in the U.S. Thus, as the Times reports, “Parents know that they would be turned away at the border or quickly deported, so they send their children in hopes that remittances will come back.”
Partly as a result, in the past two years, 250,000 unaccompanied minors have entered the U.S. Eager to comply with the legal imperative to place these children “in the least restrictive setting” and anxious to avoid headlines about desperate children stuck in overcrowded cages, Biden’s HHS has erred on the side of releasing minors into the custody of exploitative labor brokers.
It’s hard to overstate the wrong-headedness of this arrangement. There are adults in Central America who want to fill jobs that Americans can’t fill due to a sheer lack of numbers. The U.S. has marginally increased opportunities for such prospective immigrants to work legally in the U.S. but not by anywhere near the amount necessary to meet labor demand. For this year, Congress has capped H-2B visas, which allow international workers to take seasonal positions in the U.S., at 130,716 for nonagricultural workers. Two months into the year, U.S. employers have already requested 142,000 visas for the coming spring and summer.
Immigration is no panacea for inflation. Migrants add to the labor supply, but they also add to labor demand. For this reason, right-wing nationalists are mistaken when they imagine a zero-sum contest between immigrants and native-born workers for jobs. Nevertheless, in a context where the U.S. population is aging, and a wave of retirement has rapidly shrunk the labor force, bringing in prime-age workers would likely reduce inflationary pressure. Yet the U.S. has effectively decided that it would rather have the Federal Reserve deliberately make virtually everyone in the country poorer than substantially increase immigration.
Meanwhile, while waiting for the Fed’s interest-rate hikes to succeed in killing economic expansion, we’ve been letting Central American families mitigate our labor shortages and their own poverty only if they agree to send their children on a long, perilous journey into indentured servitude.
Of course, this is not official U.S. policy. On Monday, in response to the Times investigation, the Department of Labor announced a crackdown on the exploitation of child-migrant labor in the U.S. But it is unlikely that the federal government will be able to fully dismantle the illicit labor force it has accidentally created any time soon. Furthermore, successfully enforcing child-labor laws will be insufficient in relieving the suffering of most young migrants. After all, in many cases, their lives back home were characterized by destitution so profound that traveling thousands of miles to perform hard labor seemed preferable.
Immigration policy alone will not address all of the injustices uncovered by the Times. In some instances, the paper describes working conditions that no one should endure. Ridding the U.S. economy of hyper-exploitative workplaces will require radical reforms of labor law. Meanwhile, resolving the tension between price stability and wage growth in a manner that doesn’t concentrate the costs of adjustment on the vulnerable might demand the establishment of sectoral bargaining or a vast expansion of the state’s planning capacity.
But radically restructuring a political economy in an egalitarian manner is hard. Letting more adults work in our country should be easy. And yet, for the moment, it looks like we’d rather force Central American families to turn their kids into breadwinners, and force our own economy into a recession, than open our door to migrant workers.