Reply #76: Guest worker programs should include strong wage protections for U.S. workers

[L. Coyote]

August 10, 2006 | EPI Issue Brief #226
Guest worker programs should include strong wage protections for U.S. workers
by Ross Eisenbrey and Monique Morrissey
http://www.epi.org/content.cfm/ib226

A key issue of evolving immigration policy in the United States is whether employers should be able to hire temporary or "guest" workers from other countries when workers are scarce and wages are rising. Though popular with employers, guest worker programs are generally opposed by labor unions and others who say these programs risk displacing U.S. workers or pushing down their wages.

The immigration bill passed on a bipartisan basis by the U.S. Senate—the McCain-Kennedy bill, or S. 2611—tries to balance these competing concerns by requiring employers who want to recruit temporary guest workers in the construction and service industries to first offer the jobs, at the prevailing industry wage, to U.S. workers. If no qualified U.S. workers apply for the jobs, employers can hire guest workers but must pay them the prevailing wage.

In a report issued in July 2006, the Senate Republican Policy Committee (RPC) attacked the prevailing wage provision .... claims that the law expands the reach of the Davis-Bacon Act, which requires construction companies with federal contracts to pay employees the prevailing wage. But the McCain-Kennedy bill specifies only that the wage employers offer to construction workers must be the prevailing wage, as measured under the Davis-Bacon Act, and none of Davis-Bacon's wage reporting or enforcement provisions is applied to guest workers.

Should immigration reform include prevailing wage protections?

The rationale for expanding guest worker programs is to increase the supply of workers during labor shortages. Most economists would dispute the notion of a labor shortage in the case of low-skilled workers, since employers can always find workers to fill these jobs if they offer high enough wages.

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