The Myth Busting Economist by Larry Malone

A New Way of Thinking about Immigration

It’s been many weeks since I’ve last been myth busting, and it’s because I became a first time grandparent! Our son and daughter-in-law have decided that my grandson should call me Proffy, so we’ll see how that works out in a couple of years.

Our last busted myth concerned the minimum wage, which we discovered is basically irrelevant since a 4.1 percent unemployment rate means we are enjoying the fruits of a full employment economy. That’s good news for workers, as extraordinary low unemployment creates a “seller’s market,” where folks seeking work have lots of choices while employers battle headaches in trying to find good help.

Jobs are plentiful and workers are scarce, and not because people are sitting home living off of handouts from the government. At the end of my last column, I promised a solution to solving our worker shortage. The fix comes from a charged-up word we’ve heard on a daily basis for the past few years—immigration. So let’s go bust one of the biggest myths of all when it comes to encouraging a strong and thriving economy.

We start with some irrefutable historical facts. The average unemployment rate in the United States over the past 50 years was 6.3 percent. That’s 1.3 percent above our 5 percent full employment rate. When the unemployment rate is 6.3 percent, we are probably in or recovering from a recession. And that’s been the average for each of 50 years.