MUSINGS OF A CEO

The politics around undocumented immigrants continues unabated, no matter the abject need for workers in the United States.  The Democrats use the lack of reform as a recruiting tool, while the Republicans use the possibility of change as fear bait.  All the while American businesses scour the landscape for employees, hanging signs outside their offices broadcasting job openings, as my company has done for several years.  Emerald Packaging entered the pandemic in March 2020 with 25 openings, and still has 18 today, a stark contrast from most of my years in business, when we could hire freely and rarely had any unfilled positions.

I know we aren’t alone. Ask any businessperson their most pressing issues, and lack of labor comes in the top three. With the unemployment rate trending around 3.5%, the Bureau of Labor Statistics, a government agency, says the country currently has over 8.8 million job openings, over 1.5 million more than just prior to the pandemic, when openings were already near an all-time high.  Ten years earlier, we had less than 4 million openings.  A historically low Labor Participation Rate has hurt, with only 62.8% of able working age Americans employed, compared to 66% prior to the 2008 recession. That’s roughly 5 million missing workers, most of whom retired, according to new research by the San Francisco Federal Reserve.

Meanwhile, we have around over 11 million undocumented immigrants in the United States, with around 6.5 million in the workforce currently, according to the U.S. Department of Homeland Security.  However, many of those working — if not most — are trapped in the informal economy, stuck in jobs they can’t get out of without papers, regardless of skills.  Many Americans want the undocumented thrown out of the country en masse, which would only exacerbate a horrid labor shortage that’s draining growth from the economy.  I know this firsthand. Our sales could have been at least 5% higher last year had we been able to fill jobs.  And don’t lecture me about low wages. We’ve increased pay 15% over the last twelve months, and have packages equal to Tesla, the automaker down the highway from us.

The answer isn’t to throw workers we desperately need out of the country.  It isn’t to pretend we want immigration reform and do nothing about it.  The answer clearly lies with finding a path to legalization for workers already in the country. And creating a system that allows in the immigrants we need each year with the skills needed. Likely it’s a number that would end up in the many millions given the onslaught of Baby Boomers due to retire over the next few years.

I have more experience than I want with this issue. Around 12 years ago U.S. Immigration and Customs Enforcement audited us.  We had to let 18 long-term employees go, including supervisors and foremen.   Though seven came back over the next year having obtained legal status, I don’t think we’ve ever replaced the talent lost. And just a year ago six employees from a company across town that had closed applied for jobs, with the exact skills needed to fill open positions. But they failed the ICE e-verify check we now do to confirm status. Those jobs remain unfilled.

So, here’s a call for a sane immigration debate that leads to realistic solutions. It seems a remote hope right now, especially with the silly season of Presidential primaries upon us.  American business needs realism on this issue more than ever, and posturing politicians and media empires calling for blood serves us badly.  We have to speak up. I’m not saying this as some bleeding heart. I’m saying it as a businessman looking at the “Now Hiring” sign that has hung from his building for three years now.  With no end in sight.