Jobs Report: Native and Foreign-Born Unemployment Rates Show Near Parity Amid Immigration Focus

Economist Jed Kolko, a former Under Secretary of Commerce for Economic Affairs, has advised a focused approach when interpreting upcoming jobs reports, particularly concerning the role of immigration. Kolko, known for his expertise in labor markets and data analysis from his tenures at Indeed and Trulia, emphasized specific metrics to glean accurate insights into the U.S. labor landscape.

In a recent social media post, Kolko stated, > "Previewing tomorrow's jobs report: what we can and can't learn about immigration. Focus on: (1) native- and foreign-born unemployment rates (2) job growth in immigrant-reliant industries. Ignore pretty much everything else." This guidance underscores the importance of granular data over broader, potentially misleading statistics.

Recent data from August 2024 indicates a near parity in unemployment rates between native-born and foreign-born workers in the U.S. As of June 2024, the unemployment rate for native-born workers stood at 4.3%, while for foreign-born workers, it was 4.2%. This close alignment highlights a significant aspect of the current labor market often overlooked in general employment figures.

Experts suggest that focusing on unemployment rates and employment-to-population ratios provides a more accurate picture than simply looking at overall employment levels, which can be skewed by population adjustments. The Economic Policy Institute (EPI) has previously warned against misinterpreting changes in U.S.-born and foreign-born employment levels due to such statistical nuances.

Immigrants constitute a substantial portion of the U.S. workforce, making up over 19% as of June 2024. Their contributions are particularly vital in sectors heavily reliant on immigrant labor, such as healthcare, agriculture, and construction. For instance, immigrants account for approximately 45% of workers in farming, fishing, and forestry, and 43% of home healthcare aides.

The influx of immigrant workers has been a significant driver of U.S. labor force growth, boosting overall population and job creation. Some analyses suggest that increased immigration contributed substantially to monthly payroll job growth in recent years. Understanding these specific dynamics, as Kolko suggests, is crucial for policymakers and the public to grasp the multifaceted impact of immigration on the nation's economic health.