BUSINESS PULSE : ORANGE COUNTY ISSUES & ATTITUDES : Amnesty Law Didn’t Bring With It Labor Loss That Business Feared
When the new immigration law was enacted in November, 1986, Ronald Marshall’s worst fears seemed to come true. For the next four months, Marshall said, he couldn’t find workers to fill six dish washing jobs at the Mr. Stox restaurant in Anaheim.
Marshall, who owns the restaurant and oversees the hiring of its 78 employees, said applications for the jobs dropped from about 10 a week to about one.
But the problem didn’t last.
“Whatever it is that workers do to get around the law, they’re doing it, and the shortage is basically over,” he said. “There definitely was an impact, but things have swung back the other way.”
Marshall’s experience parallels those of hundreds of other Orange County businessmen who run both small and large companies.
In The Times’ executive outlook survey, 84% of respondents said the new immigration policy has had no noticeable effect on their businesses. The numbers are similar across industry groups.
From restaurant owners to construction companies, from carwashes to microchip makers, the new immigration law has not brought about the labor shortage that Orange County business feared.
Even in industries that rely on immigrant labor and should be most adversely affected by the law--apparel, construction, restaurants and hotels--the impact of the law seems minimal.
“We have not encountered a labor shortage,” said Ruben Villavicencio, president of R & M Food Services in Brea.
The Immigration Reform and Control Act grants amnesty to all illegal immigrants able to document continuous residence in the United States since Jan. 1, 1982. It also requires employers to obtain proof of citizenship or legal residence from each worker. The biggest question in the minds of Orange County employers appears to be whether the federal government will be able to enforce the law’s provisions. The Immigration and Naturalization Service has said it will move from its “educational phase” into its “enforcement phase” June 1.
Employers said the main obstacle to enforcing the law is the widespread use of false identification by much of the immigrant work force. Many employers said high-quality forged documents are almost impossible to detect. Equally important, the law does not require them to verify the authenticity of documents.
If the law is rigidly enforced, most employers agree that it would have a dramatic impact on wages and the availability of workers.
According to Baldwin Keenan of the Orange County District Council of Carpenters, a trade union group, the labor pool would shrink about 20% to 30% for basic construction tasks in the housing industry if the law’s provisions are heeded.
“If it were enforced--if you eliminated all the subterfuge--it would have a significant impact on the supply of framers and the guys doing sheeting,” Keenan said.
Costs would rise dramatically as well. The basic wage for a day’s work in the industry is about $25 for non-union workers, many of whom are day laborers, Keenan said. That contrasts with a wage of roughly $130 a day for unionized workers, he said. Brian Theriot, director of investor relations for J. M. Peters, said the law has had no impact on the Irvine construction company. “We never hire non-Americans,” he said. But he noted that the company hires subcontractors to do much of the firm’s basic home construction tasks.
Most employers said complying with the law is not difficult and has not hurt business. “It just increases our overhead a bit, and it’s a bit of a hassle for employers to come up with certifiable birth certificates or passports,” said Pat Kane, president of Applied Data Communications.
IMMIGRATION
One in six CEOs say changes in the immigration law have had noticeable effects on their business.
Policy Affects Business Yes No All CEOs 16% 84% NO. OF EMPLOYEES 50-99 12 88 100-249 19 81 250 or more 17 83 INDUSTRY Construction 13 87 Manufacturing 20 80 Retail/Service 16 84 FIRE * 8 92
* Finance, Insurance or Real Estate The 16% who answered yes to the question above were asked to evaluate those effects.
Noticeable Effects Yes No Labor shortage 82% 18% Higher costs 75 25 Increased wages 66 34
