Illegal Immigrants and Domestic Employment

Abstract

This paper develops and tests a simple general equilibrium model to explore the common allegation that illegal immigrants take jobs away from native-born workers. A simulation of the effect of an increase in illegal immigration shows that the distribution of the immigrants among industries is critical in determining their effect on employment. If two-thirds of the illegal immigrants are employed in the agricultural service sector, for example, an increase in illegal immigration would increase domestic unskilled employment, but if only half are employed in that sector, an increase would lead to a decline in domestic unskilled unemployment.