Photo: Arizona's economy
The state of Arizona is hurting its own economy by approving harsh measures targeting undocumented immigrants, according to a report by a libertarian think-tank.
After the approval of the state employer sanctions law in 2007, firms have reduced their hiring and are using an “informal” economy to eliminate paperwork when hiring personnel, the Cato Institute said in its analysis entitled “The Economic Case against Arizona’s Immigration Laws.”
The law forces all businesses in Arizona to use the federal E-Verify program to ascertain the immigration status of job applicants.
The report also says that since 2010, when the state enacted SB 1070, the nation’s first law to criminalize the presence of undocumented immigrants, many such people have been driven out of Arizona.
The departure of the immigrants “lowered the state’s population, hobbled the labor market, accelerated residential property price declines, and exacerbated the Great Recession in Arizona,” Cato said.
The analysis emphasizes that the use of E-verify is one of the main reasons that employment in construction fell in Arizona at a greater rate than in neighboring states that do not require its use.
In 2006, 11.2 percent of Arizona’s population was employed in construction, compared with 22.2 percent of the immigrant community.
Four years later, 8.9 percent of the state’s residents work in construction while among the immigrant community the percentage has fallen to 15.9 percent.
The Cato report says that during the period from July 2007 through September 2011, employment in construction in Arizona declined 50.2 percent, compared with 36.8 percent registered in neighboring California and New Mexico.
The analysis concludes that this kind of legislation resulted in many undocumented immigrants leaving Arizona, and with them went part of the state’s economic growth potential.
“States now considering Arizona-style immigration laws should realize that the laws also cause significant economic harm. States bear much of the cost of unauthorized immigration, but in Arizona’s rush to find a state solution, it damaged its own economy,” Cato said.
Several states, including Alabama and South Carolina, have already adopted legislation modeled on SB 1070.