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The national debate on immigration often focuses on moral questions and security concerns, but a new Harvard Kennedy School Faculty Research Working Paper authored by Professor George Borjas is bringing labor market implications into the discussion. “The Wage Impact of the Marielitos: A Reappraisal” provides an analysis of the real wage impacts created by the migration of thousands of low-educated low-skilled Cuban workers into Miami during the Mariel boat lift in 1980.
“The Mariel boat lift presents a unique opportunity for conducting this type of research,” Borjas writes. “The flow was unanticipated, very large, and specifically targeted a particular group of workers. In a matter of weeks, the number of high school dropouts in Miami’s labor market increased by 20 percent. The research method essentially compares what happened in Miami before and after Mariel to what happened in other cities.”
Axis showing log weekly wage of high school dropouts
More than 100,000 Cuban refugees arrived in the United States during a six-week period in 1980, more than half of whom settled in south Florida. Prior research had shown that the local labor market grew by seven percent during that period, but there had been no conclusive evidence until now showing the extent to which low-educated, low-skilled workers were impacted.
“Although it has been widely believed that Mariel did not have much of an impact on the labor market, it turns out that by focusing on the very specific group of targeted workers—high school dropouts—and by more carefully choosing the placebo used to compare to Miami, there was a very significant decline in the wage of the least skilled workers in Miami,” Borjas writes. “The wage decline over the 5 year period following Mariel was between 10 and 30 percent.”
Borjas writes that the change in the Miami labor market was a “very unusual event,” and should be a lesson for policymakers as they debate immigration policy.
“Immigration has both benefits and costs, and the costs, in terms of the wage decline caused by additional labor market competition, can be substantial and can be borne by some of the most disadvantaged groups in our society,” Borjas concludes.
George J. Borjas is the Robert W. Scrivner Professor of Economics and Social Policy. His teaching and research interests focus on the impact of government regulations on labor markets, with an emphasis on the economic impact of immigration.
George J. Borjas, Robert W. Schrivner Professor of Economics and Social Policy
Photo Credit: Martha Stewart
“Immigration has both benefits and costs, and the costs, in terms of the wage decline caused by additional labor market competition, can be substantial and can be borne by some of the most disadvantaged groups in our society." --George Borjas