What happened to wages of native-born workers after Arizona passed E-Verify?

Liz Goodwin
The Lookout

Lawmakers in several states have vowed to pass undocumented employer sanction laws after the Supreme Court upheld Arizona's this year. Rep. Lamar Smith (R-Texas) has drummed up some support to pass a federal version in Congress that would require all employers to use the government's E-Verify database to ensure their employees are authorized to work--or risk losing their business license.

Arizona provides a case study for the effects of a tough E-Verify law on the labor market.

According to a study released this year by the Public Policy Institute of California, about 92,000 or 17 percent of the Hispanic non-citizen population of Arizona left in the year after the state passed E-Verify legislation. The researchers say most of them were illegal immigrants, and determined that the recession was not the cause of the exodus by comparing the migration patterns to those of other states.

After this exodus of mostly illegal immigrants, wages did not budge for native-born residents, the study found. More of the remaining Hispanic immigrants became self-employed over the same period, suggesting that they were pushed into informal and underground jobs as employers no longer wanted to take the risk of hiring them formally after the law passed.

E-Verify is a federal system that combines Social Security data with Department of Homeland Security immigration data. For authorized workers, the system is right about 99 percent of the time. (That error margin adds up: If applied to the whole workforce, nearly 800,000 people would be falsely flagged by the system.)  A person only has 8 days to appeal if the system falsely labels him or her as an illegal immigrant. Meanwhile, the program only correctly identifies illegal immigrants about half the time.

So far, Mississippi, Alabama, Georgia, South Carolina, North Carolina, Tennessee, Louisiana, and Utah have adopted mandatory E-Verify laws.

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