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Immigration overhaul may hit small businesses

Marketplace Contributor Jan 30, 2013

Immigration overhaul may hit small businesses

Marketplace Contributor Jan 30, 2013

Yesterday in Las Vegas, President Barack Obama said he wants Congress to give some 11 million undocumented immigrants a pathway to citizenship. Obama said it’s time to deal with the nation’s shadow economy.

“A place where employers may offer them less than the minimum wage,” Obama said. “Or make them work overtime without extra pay.”

If you don’t have citizenship papers, work options in the U.S. are limited. Just ask 49-year-old Maria Espinosa. She’s been in the U.S. for 25 years. She’s cleaned houses, she’s worked in fast food restaurants.

“Without papers we can do only, housekeeping, babysitting, landscaping, restaurants,” Espinosa said. “There were times when I was working for $6 an hour. Even $5. Even $5.”

Espinosa wants better work opportunities. And she actually caught a break at a fast food restaurant a few years ago.

“The manager said, ‘Oh Maria, your work is pretty good. You can be promoted to chief manager, or assistant manager.’ The problem is that I had to have a real Social Security number,” Espinosa said.

That real Social Security number means she could stand up for herself, ask for more money, maybe go look for a different job.

So if millions of workers are suddenly able to do exactly that, what happens to small businesses who have been relying on cheap labor?

Raul Hinojosa, a political economist at UCLA, said, “The only ones that are gonna go under are the ones who are completely dependent on this undocumented labor force.”

Hinojosa studied what happened in 1986 — that’s the last time that millions of undocumented workers were granted citizenship in the U.S. Wages went up 15 to 20 percent. Sweatshops and some other businesses closed down. And he said if Congress acts again, it’ll be difficult to find workers for certain jobs.

“You may find it a little bit difficult to find someone who is gonna take care of your grandmother,” Hinojosa said. “You may not see a plentiful supply of people parking cars. Restaurants? You may not see as many busboys.”

But Hinojosa knows that some companies will adapt. And, he said, there are economic benefits to small businesses when workers suddenly become citizens.

“They learn English, they finish their GEDs, which they never did before because they were scared and lived in the shadows,” he said. “They become more productive workers for their employers.”

And hopefully as citizens, experienced workers like Maria Espinosa can leave behind cleaning and fast food jobs once and for all.

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