Aug 23, 2023·edited Aug 23, 2023Liked by Mari, the Happy Wanderer
One general rule-of-thumb I've heard, regarding immigrations' impact on wages is that there's a difference between manufacturing and service jobs. Immigrants increase both the supply of labor (because they work) and the demand for labor (because they increase the total size of the economy and buy stuff themselves). In the service sector, the demand effect overwhelms the supply impact, and vice-versa for manufacturing.
Imagine a 100K Canadians suddenly migrate into Reno. If you own a coffee shop, you suddenly have 100K new potential customers. You can sell more coffee, charge more, open another branch, and even specialize products that appeal to the new Canadian cohort. This tends to increase wages.
What's going to happen at Tesla, though? Probably a drop in wages. The immigrants will increase the size of economy, but Tesla won't suddenly ramp up their production or double the size of their factory. They might do that in the a year or so, but the size of factory is fixed in the short run, so wages will fall.
That said, I can't help but think that the economic arguments are smokescreens for cultural preferences. It's the one debate where conservatives are suddenly a lot more skeptical of markets and liberals suddenly care a lot more about GDP growth.
This is a thoughtful and thought provoking article about a truly worrisome issue - that sits at the heart of what it is. to be American. At the outset, it meant to be from somewhere else. (Just ask the native Americans!)
One general rule-of-thumb I've heard, regarding immigrations' impact on wages is that there's a difference between manufacturing and service jobs. Immigrants increase both the supply of labor (because they work) and the demand for labor (because they increase the total size of the economy and buy stuff themselves). In the service sector, the demand effect overwhelms the supply impact, and vice-versa for manufacturing.
Imagine a 100K Canadians suddenly migrate into Reno. If you own a coffee shop, you suddenly have 100K new potential customers. You can sell more coffee, charge more, open another branch, and even specialize products that appeal to the new Canadian cohort. This tends to increase wages.
What's going to happen at Tesla, though? Probably a drop in wages. The immigrants will increase the size of economy, but Tesla won't suddenly ramp up their production or double the size of their factory. They might do that in the a year or so, but the size of factory is fixed in the short run, so wages will fall.
That said, I can't help but think that the economic arguments are smokescreens for cultural preferences. It's the one debate where conservatives are suddenly a lot more skeptical of markets and liberals suddenly care a lot more about GDP growth.
This essay should go to whomever in US government that thinks rationally.
(o wait)
This is a thoughtful and thought provoking article about a truly worrisome issue - that sits at the heart of what it is. to be American. At the outset, it meant to be from somewhere else. (Just ask the native Americans!)
Yesssss I love this use of the collage!! ❤️