Between 1990 and 2000 the US’s Hispanic population grew by 61 per cent: this year, America’s 41m Latinos overtook blacks to become the nation’s largest minority
Financial Times 29/8 2005

Samuel Huntingdon, the Harvard academic, caused a furore last year with a book that warned that Hispanic immigrants threatened to “divide the United States into two peoples, two cultures, and two languages”. Mr Huntingdon wrote: “Unlike past immigrant groups, Mexicans and other Latinos have not assimilated into mainstream US culture, forming instead their own political and linguistic enclaves – from Los Angeles to Miami – and rejecting the Anglo-Protestant values that built the American dream.”

It is possible to argue that today’s Hispanic immigrants maintain such close links to their culture simply because they can. Sergio Bendixen, a leading pollster who migrated to the US from Peru, suggests that modern communications changed the nature of assimilation. International phone cards of the type sold in Bethlehem’s Hispanic groceries enable callers to bypass long-distance charges and pay pennies a minute to stay in contact with home.

Even without the benefit of modern technology, Mexicans always had the advantage over European migrants that they could easily go home. Mr Fuentes, the novelist, suggests this is a critical distinction. “They didn’t come over the ocean, they came by land,” he says. “It’s an enormous difference. It’s where the language is rooted and the customs are already there and the historical memory is there.”

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The mystery of the missing millions
Everett Ehrlich, a former undersecretary of commerce for economic affairs, Financial Times, Mar 7, 2001

The 2000 US decennial census is now over and it leaves behind three different estimates of the US resident population. Taken together, these estimates reveal an important - and unexpected - trend in the US economy.

The first number was the Census Bureau's estimate of how many people it expected to find before the census was taken - 279.6m. That estimate is obtained by starting with the 1990 census, correcting for its undercount and factoring in all the births, deaths, immigration and emigration that have taken place since.

But in December, the Bureau announced the raw totals of the 2000 census: 281.4m people, almost 2m more than the number suggested by relying on demographic records of birth, death and migration.

Something was obviously wrong with these so-called demographic records: the census managed to contact direct more than a million more people than those records suggested would exist.

The disparity between the two numbers led many number crunchers to question whether the figure of 279.6m - based on demographic records - was correct and whether the raw census number of 281.4m might be inflated by thrill-seekers who had responded to the census twice.

Fortunately, it was possible to find out. The results of a detailed follow-up survey - with a stratified sample of more than 300,000 households over the country - revealed a third number, which scientifically accounts for patterns of undercount and overcount. That process led to an estimate of the total US population on the day of the census - April 1 2000 - of 284.7m, more than 5m over the expected count.

But if that is the best estimate of US population, why are the demographic records so far off? The most likely answer - and an important thing we may learn from the 2000 census - is that millions of undocumented immigrants entered the US during the past decade. It is the only way the missing millions could have marched into the economy without the record-keepers noticing.

The idea that there was substantial, uncounted immigration is supported by another statistical mystery that occurred during the 1990s. If you ask all the employers in the economy how many new jobs they gave people during the 1990s, the answer is 22m. But if you ask all the people in the economy how many new jobs they took, the answer is only 16m. And we know enough about job patterns to know that people taking two or more jobs is not the explanation for the disparity.

Every time employers confess to hiring a new person, they have to pay that person's social security and unemployment insurance taxes; they have no incentive to spin the number. But the corresponding number of jobs people take is based on a monthly Census Bureau survey of 60,000 households that is scaled up using an estimate of the population. So if the population guess is too low, we will end up with too low a number of jobs that people report taking.

Immigration is primarily an economic phenomenon and America's full employment economy has been a magnet for foreign workers. And although we may think of immigration as being a Mexican border issue, we are also talking about programmers from India, engineers from the former Soviet Union, service workers from Ireland and a host of other people from a range of countries, all across the labour force, who often work in the US for a while and then go home. Many make several trips back and forth each year, so it is easy to make mistakes counting them. And enforcement of the immigration laws gets tougher when the labour market gets tight: there are not many employers who are desperate for labour but still call the immigration authorities when their workers "misplace" their green cards.

These uncounted millions of foreign workers explain another mystery: how the US was able to achieve 4 per cent unemployment for so long without an incendiary increase in labour costs. In essence, these millions of undocumented workers all along the skill spectrum have increased the economy's productive potential.

Cheap air travel can take anyone from Bombay, Dublin or Kiev to New York or Los Angeles in a matter of hours.

In such a world, the idea that labour shortages create cost pressures that cut off economic growth may be a thing of the past.

We live in a world in which all resources are mobile - capital, goods and services, technology - the list goes on. But the lesson of the 2000 census is that people are more mobile than we thought.

The economy that denies itself this resource does so at its peril. And the people who came to the US in the 1990s, by hook or by crook, played a vital role in the greatest economic expansion in that nation's history. It just took us a while to count them.