Newcomers in the American Workplace: Improving Employment Outcomes for Low-Wage Immigrants and Refugees

Publication Year: 
Moran, Tyler and Daranee Petsod

Newcomers in the American Workplace is a joint publication of Grantmakers Concerned with Immigrants and Refugees and the Neighborhood Funders' Group's Working on Labor and Community. This report responds to the dramatic growth in the immigrant population over the past decade and calls attention to the crucial role that immigrants play in the U.S. economy. Today, immigrants comprise almost one in eight workers and one in four low-wage workers. They are the backbone of many industries that simply would not be able to survive without their skills, labor, and innovation.

Newcomers in the American Workplace also highlights the multiple challenges immigrants confront in the labor force, from lack of legal status to language and cultural barriers. Targeting the foundation audience, the report offers examples of innovative approaches for addressing these challenges and recommends a range of grantmaking strategies, from supporting research, organizing, and advocacy aimed at improving employment outcomes for today's low-wage immigrant workers to supporting efforts that strengthen the ability of public education systems to prepare second-generation immigrants for successful workforce participation.

GCIR and NFG extend our special thanks to The Ford Foundation, The Hitachi Foundation, and The Rockefeller Foundation for their generous support of this publication and to the many organizations that shared their knowledge and expertise on issues facing low-wage immigrant workers.

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Executive Summary

First-generation immigrants play a crucial role in the U.S. economy, comprising almost one in eight workers[source] and one in four low-wage workers.[source] They fill critical jobs, are the backbone of many industries, and are net contributors to the nation's tax base. Without current and future immigrants in the workforce, our aging society will be dramatically short of workers to staff its offices, factories, and farms; short of savings and investment to support national economic growth; and short of tax revenues to finance government services and Social Security outlays.

Despite their pivotal role in the U.S. economy, many immigrant workers confront enormous challenges in the labor force: language and cultural barriers, exploitative working conditions, immigration-status vulnerabilities, restrictions on access to public services and benefits, and workforce development and education systems that do not respond to their needs. Disproportionately concentrated in low-wage jobs, immigrants make up 20 percent of all low-income families,[source] although they constitute about 11 percent of the total population.

Given immigrants' growing numbers and their expanding economic role in U.S. society, addressing challenges and creating opportunities for immigrants to succeed in the labor force are critical prerequisites to improve the economic security for all low-wage working families and ensure the future vitality of our economy.

In response, foundations can consider a range of grantmaking strategies depending on their funding approaches, issue priorities, geographic focus, and level of interest in immigration. By incorporating immigrant workers into their grantmaking priorities, foundations can play a vital role in spurring and supporting innovative strategies to improve working conditions, increase wages, enhance employment mobility, and strengthen economic security for all low-wage workers.

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Profile of Immigrants in the Workforce

  1. The face of America and its workforce has changed. The immigrant population in the United States increased from 19.8 million in 1990 to 31.1 million in 2000. Immigrants now comprise 11.1 percent of the U.S. population and 12.4 percent of the nation's workforce.[source] In the 1990s, 78.2 percent of the foreign-born population came from Latin American and Asian countries,[source] many of which countries had poor economic conditions and low levels of investment in education and skill development.
  2. Immigrants will account for half of the working-age population growth between 2006 and 2015 and for all of the growth between 2016 and 2035, assuming today's levels of immigration remain constant. Their labor is critically needed to replace the declining number of working-age Americans as the "baby boomer" generation retires.[source]
  3. Immigrant workers are concentrated in low-skill, low-pay jobs, although they are represented across the employment spectrum. For example, almost 63 percent of foreign-born workers, primarily from Latin America, work in service, manufacturing, and agricultural occupations.[source] Roughly 17 percent of highly skilled technology professionals working in the United States are foreign born.[source]

Challenges Keeping Immigrants in Working Poverty

  1. Immigration status matters. Approximately nine million undocumented immigrants live in the United States, accounting for about 28 percent of all immigrants in this country.[source] Nearly five million undocumented immigrants are part of the U.S. workforce.[source] Immigration status plays a central role in keeping many undocumented workers in poverty. Without legal status, they have little choice but to remain in jobs that pay minimum wage or below, with few or no benefits such as health insurance or pensions. These jobs are frequently part-time or seasonal, forcing immigrants to string together several jobs at one time to support their families. And working conditions are often dangerous or unhealthy. The aftermath of the September 11, 2001 attacks has only compounded legal-status challenges for undocumented immigrants.
  2. Many immigrants confront multiple barriers to employment. Immigrants arrive in the United States with a variety of educational and occupational backgrounds. While newly arrived immigrants include a higher percentage of people with advanced degrees compared to native-born persons, they also include a higher percentage of people with fewer than nine years of formal education. Immigrants' lack of English proficiency, limited skills, low levels of education, and poor understanding of American cultural and workplace norms restrict their access to good jobs that pay family-sustaining wages and provide opportunities for advancement.
  3. Many job training and placement programs are not accessible to or meet the unique needs of immigrant and other limited-English workers. One-stop centers and other publicly funded programs often have difficulty providing basic language access, much less culturally competent services.
  4. Low-wage immigrant workers are the least likely to receive job-based benefits. In 2000, only 26 percent of immigrant workers had job-based health insurance, compared to 41.9 percent for native-born workers.[source] Immigrants are also less likely to hold jobs that provide other fringe benefits, such as paid sick days and pensions.
  5. Many immigrants do not access or are ineligible for government programs. Immigrants, including those who are eligible, are the least likely to access programs that support low-income workers, such as the Earned Income Tax Credit and Unemployment Insurance. Additionally, legal immigrants entering the United States after 1996 are ineligible, during their first five years in the country, for federal programs such as Food Stamps and Medicaid that many native-born, low-wage workers regularly access to support their families.
  6. Immigrants suffer unique discrimination and exploitation in the workplace. Many U.S. employers treat immigrant workers fairly and comply with labor and immigration law. Some, however, discriminate against them or exploit them through low wages, long hours, poor working conditions, or denial of other rights. Although native-born workers can also be subject to such treatment, immigration status, compounded by cultural and linguistic isolation, increases immigrants' vulnerability to discrimination and exploitation.
  7. Immigrants who participate in union-organizing drives are particularly vulnerable to employer intimidation tactics, such as reporting workers to the INS (Immigration and Naturalization Service).* Although such tactics are illegal under U.S. labor law, penalties are light and often come too late to change the outcome of organizing campaigns.
  8. Current labor laws do not provide comprehensive worker protections. Immigrants often hold jobs, such as temporary and seasonal jobs, that are not protected under labor laws. Even immigrants who are protected frequently do not file complaints, fearing that they will be fired, reported to the INS, and/or deported.
  9. Improving working conditions, wages, and benefits in low-skill occupations is an important strategy. Not every worker--immigrant or native--will be able to acquire the education and skills needed to move into jobs at the higher rungs of the economic ladder. In addition, low-skill jobs in the service, manufacturing, and agricultural industries will always be part of the economy, and some occupations, such as home healthcare aides, are expected to experience significant growth in this decade. These jobs do not necessarily have to pay poverty-level wages and no benefits. In many cases, particularly where workers are covered under a collective-bargaining agreement, employers do pay decent wages, provide family health and pension benefits, and contribute to training funds that offer career advancement opportunities.

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Recommendations to Funders

Regardless of grantmaking approach, priorities, and geographic focus, foundations can support a range of strategic options to improve working conditions, strengthen workers' rights, and expand employment opportunities for low-wage immigrant workers in ways that improve economic security for all workers. Foundations can support:

  1. Efforts to enhance language access to welfare-to-work programs and increase the availability of English-language classes.
  2. Comprehensive workforce development programs that integrate job training (both hard and soft skills), English-language acquisition, and cultural orientation.
  3. Workforce development programs that forge multi-sector partnerships among employers, unions, community groups, faith-based organizations, and government.
  4. Programs that help immigrants gain fair recognition and receive accreditation for the skills, education, and experience they bring from their country of origin.
  5. Strategies to improve the ability of public education systems to successfully educate children of immigrants to improve their long-term employment outcomes and economic security.
  6. Efforts to educate and develop the leadership of immigrant and other low-wage workers to protect their workplace rights, increase their wages and benefits, and improve their employment potential.
  7. Community-based efforts to protect immigrant workers who may risk intimidation, job loss, or deportation if they participate in union-organizing drives.
  8. Advocacy and organizing to improve public policy, employer practices, and economic outcomes for low-wage immigrants.
  9. Research on low-wage immigrant worker issues to inform program and policy development.
  10. Legal services, advocacy, and litigation to protect and advance worker's rights.

*The INS, formerly part of the of the U.S. Department of Justice, was reorganized into two separate bureaus - the Bureau of Border Security and the Bureau of Citizenship and Immigration Services - under the Department of Homeland Security, established in fall 2002. Restructuring the INS has only begun at the time of this writing. Therefore, this report utilizes the more commonly recognized term, "INS" when referring to the federal immigration department.

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