by Barbara Marcolini
When warm summer weather arrives, inviting New Yorkers to go out, Annamaria celebrates. The busiest season for catering means the waitress will work seven days a week and save money for the winter, when work is scarce. Since she arrived from Lima, Peru, ten years ago, Annamaria learned how to deal with the ups and downs of the informal market.
“We, undocumented, must manage well our money,” she said. “At anytime we can find ourselves without work, and there’s no one to help us.”
The low wages Annamaria and her husband, both undocumented immigrants, found in New York were enough for raising their two daughters, but never left something to spare. The girls, now in their 20’s, started working early in the restaurant business and earned enough to pay for their own college studies. All the support Annamaria’s family had was their own labor.
The planned minimum wage increases across the country are expected to benefit millions of American workers. But higher wages will be particularly important for undocumented immigrants, who can’t count on the government benefits that help support other low-income populations.
In New York, the raises planned throughout the state may benefit about 400,000 foreign-born workers with no legal status, according to the Fiscal Policy Institute, an independent organization focused on researching economic issues. The same may happen in California, where the labor force includes about 1.85 million undocumented immigrants.
“Most of these workers have low education, tend to fill low-skilled positions and the employment is their main source of income,” said Giovanni Peri, chair of the Department of Economics at the University of California, Davis. “Differently from U.S.-born workers, these immigrants don’t benefit from the social support net.”
Immigrants, both legal and illegal, make up a considerable large part of the low-wage labor force in some states. In New York, one in every three workers making below $15 an hour was born outside the US. In total, 43 percent of all immigrants in the state will get a raise, according to the Fiscal Policy Institute.
“They [undocumented] are even more likely to be in the industries that will be mostly affected [by the raises] as restaurants, retail, home health care, construction,” said David Kallick, a senior fellow at the Fiscal Policy Institute.
The impact of higher wages will be sharper for those who live in the shadows. Working is the only source of income for 70 percent of the 6 million undocumented workers currently in the US, according to Peri. This means that people like Annamaria don’t rely on food stamps or any other form of government assistance. They also can’t count on benefits of the Affordable Care Act.
“The main difference is that those who have papers have benefits. Being illegal, I have to accept a job that doesn’t value my work,” said Annamaria. She was an accountant in Peru, but in New York works in catering for $10 an hour.
The planned raises will have a direct impact on undocumented immigrants who work in the formal economy – many use fake social security or taxpayer numbers to get formal jobs. But experts say that those who work off the books, like Annamaria, will also benefit. Since paying below the minimum is a serious violation, employers tend to comply with the minimum wage law even when hiring illegal workers. And with a tight labor market and low unemployment rates, workers have more options and can switch jobs easily, forcing companies to offer competitive wages.
“There are people being paid below the minimum wage, and there’s a need for more labor law enforcement,” said Kallick. “But it’s also hard to pay so much below [the minimum]. Employees have other options.”
But higher salaries can also mean less jobs, or at least, less hours worked. Economists contrary to a higher minimum wage argue that it harms businesses and lead to layoffs, since employees will be earning more with no increase in productivity.
Nonetheless, wage violations still diminish the effects of higher pays for this population. A paper published by the the Institute for the Study of Labor in Bonn, Germany, on the impact of minimum wage laws on immigrant workers in the U.S., pointed out that the benefits could be larger if undocumented immigrants weren’t so likely to be paid below the minimum. The study also argues that undocumented workers rarely complain about labor violations for fear revealing their illegal status.
According to a research held by the National Employment Law Project in 2008, 37 percent of the undocumented workers interviewed had been paid below the minimum wage in the week before, while the same happened to 15 percent of the U.S.-born workers interviewed. Also, 85 percent didn’t receive overtime for working more than 40 hours per week, from 68 percent of their native counterparts.
This is the situation of Antony, a Venezuelan who arrived in New York City two weeks ago fleeing his country’s economic crisis. He washes dishes at a restaurant in Manhattan from 5 p.m. until 5 a.m., making $9 an hour. According to the the law, he should earn 50 percent more for work beyond 40 hours a week.
“It was the first job that I found, and I needed to work as soon as possible,” he said, showing the sores on his hands from washing dishes for 12 hours every night. “I don’t have papers and I don’t speak English, but I’ll keep looking for something better.”
Antony’s occupation is the top one among undocumented immigrants in New York City, followed by sewing machine operators and construction workers, according to a research by the Pew Hispanic Center. It’s not a surprise that these occupations are also the leading ones on wage violations.
As a solution to fight wage violation and boost the economic benefits of raising the minimum wage, a long-discussed issue emerges: immigration reform. Even if they work off the books, undocumented immigrants pay about $11.6 billion in state and local taxes. According to the the Institute on Taxation and Economic Policy, they could pay $2.1 billion more under a comprehensive immigration reform.
For Peri, from the University of California, the economy would benefit if workers like Antony and Annamaria had a path to a legal status. He argues that illegal immigration has declined since 2008 and tends to continue slowing down.
“The real problem is what to do with the 11 million who are already here,” he said. “What will be the future of these workers?”