How to Deal with Immigrant Labor


By Geri Smith Jorge R. is on edge. On Oct. 23, a five-year investigation by federal immigration agents culminated with a raid on 61 Wal-Mart Stores (WMT) across the U.S., netting 250 janitorial workers -- all illegal immigrants, mostly from Mexico and Eastern Europe. Jorge, a 28-year-old undocumented Mexican migrant who earns $400 a month working at a restaurant just five blocks from the White House, worries he could be next. "My boss said he'd warn us if a raid is going to occur," says Jorge, who for two years hasn't dared make the trip back to Mexico to see his wife and son. "Let's hope to God that's what happens."

When are Americans going to stop pretending that it's O.K. to avail themselves of the services of these busboys, cleaning women, nannies, gardeners, grape pickers, and slaughterhouse workers, while paying them a pittance and offering them no benefits?

No one can deny that the more than 8 million undocumented immigrants in the U.S. are an integral part of the economy. Federal Reserve Chairman Alan Greenspan credited this vast labor pool with helping to power growth while keeping down inflation during the 1990s. Even now, as the jobless recovery has left many Americans unemployed, unskilled migrants continue to fill the thankless, low-wage jobs that Americans shun.

AMBITIOUS PLAN. It's high time for U.S. policymakers to face facts and address the immigration issue head-on. In the early days of his Administration, President George W. Bush, together with his Mexican counterpart, Vicente Fox, began laying the groundwork for immigration reform. But after the September 11 terrorist attacks, the White House shelved the matter. Now, Congress has seized the initiative, with at least three bills making the rounds on Capitol Hill. Says Representative Jim Kolbe (R-Ariz.): "The immigration issue is back on the burner."

Kolbe, along with two other Arizona lawmakers, is sponsoring what's probably the most ambitious of all the reform bills. The legislation would vastly expand the number of guest-worker visas available for agriculture, furniture-making, hotels, restaurants, and other service industries -- businesses that employ some 80% of all undocumented migrants. Employers would first have to offer these jobs to Americans. The bill also would allow some illegal immigrants to pay a $1,500 fine and apply for permanent residency.

The Kolbe proposal may be a tough sell, since some believe it rewards law-breakers. "The guest worker must return to his country," says Representative Tom Tancredo (R-Colo.), chairman of the 65-member Congressional Immigration Reform Caucus.

"DEFINING ISSUE." Given such concerns, the bill with the best prospects for passage is one dubbed Agjobs. The product of long consultations between U.S. agribusiness and the United Farm Workers union, Agjobs would allow an estimated 500,000 undocumented farm workers to apply for U.S. residency, subject to certain requirements. That's a modest number compared with the 4.6 million Mexicans that benefited from the Bracero program -- a U.S.-Mexico guest-worker system that was in force for 22 years, until 1964.

At the end of the day, politics rather than economics may spur reform. At 37.4 million, Hispanics constitute the largest minority group in the U.S. Their support was key to Bush's razor-thin victory in 2000. Both Democrats and Republicans are actively courting these voters. "Immigration rights is a defining issue for the Hispanic community," says Frank Sharry, executive director of the National Immigration Forum in Washington. "Whoever wins their allegiance will dominate politics over the next generation."

Hispanics aren't the only ones who want a change in immigration laws. U.S. businesses, from five-star hotels in Manhattan to carpet mills in North Carolina, yearn for a bigger pool of low-wage workers. Even organized labor now wants undocumented workers to come out of the shadows so that employers will be forced to offer them decent wages and working conditions. "They aren't going to go away, and they're more of a problem if they're forced to live outside the law than within it," says Raul Yzaguirre, president of the National Council of La Raza, the country's largest Hispanic advocacy group.

Countless Americans already trust illegal immigrants with the care of their children and the keys to their houses. Now, they must be entrusted with the rights and responsibilities of citizenship. Smith manages BusinessWeek's Mexico City bureau


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