Yesterday's Arizona Republic reported on an interesting phenomenon taking place as a new workplace identification law approaches implementation. Those workers with no documentation -- in other words, illegal aliens -- have begun to sell off their property and leave the state:
Undocumented immigrants are starting to leave Arizona because of the new employer-sanctions law.
The state's strong economy has been a magnet for illegal immigrants for years. But a growing number are pulling up stakes out of fear they will be jobless come Jan. 1, when the law takes effect. The departures are drawing cheers from immigration hard-liners and alarm from business owners already seeing a drop in sales.
It's impossible to count how many undocumented immigrants have fled because of the new law. But based on interviews with undocumented immigrants, immigrant advocates, community leaders and real-estate agents, at least several hundred have left since Democratic Gov. Janet Napolitano signed the bill on July 2. There are an estimated 500,000 illegal immigrants in Arizona.
Some are moving to other states, where they think they will have an easier time getting jobs. Others are returning to Mexico, selling their effects and putting their houses on the market.
The number departing is expected to mushroom as the Jan. 1 deadline draws closer. After that, the law will require employers to verify the employment eligibility of their workers through a federal database.
The immigration hard-liners appear to have proven one of their main arguments. Illegal immigrants who face a loss of employment due to strict employer sanctions will move elsewhere, and rather quickly. One talk-radio host that caters to what the Republic calls "undocumented immigrants" estimates that the departure rate has already hit 100 per day. It will likely increase until most of them depart before the end of the year, when their jobs will disappear.
Arizona passed employer sanctions with a particular bite. Rather than set up an escalating series of fines, which has been the federal approach, the state opted to put employers out of business. A first offense gets a ten-day suspension of the firm's business license, which would close the doors during that period. A subsequent offense revokes the business license permanently. Needless to say, that has provided an incentive to business owners to start checking identities through the federal database and terminating anyone who doesn't clear the system.
The Arizona Chamber of Commerce heads a coalition that wants the law repealed based on a Constitutional challenge, but it's hard to see how they can succeed. The state can impose sanctions on business licenses it issues, and it can insist that employers check for worker eligibility. The real issue for the ACC is labor shortages. The state currently has an unemployment rate of 3.7%, statistically full employment. Arizona employers will have to raise wages to compete for workers, which will cost consumers more but allow for more money in the market as well. It also might prompt business to push for automation where possible, using technology to fill the gaps.
However, the state does have around 9% of its workforce comprised by illegals. They rent houses and apartments, shop for food, and consume just like anyone else does in Arizona. When they disappear, the state will undoubtedly suffer a hit to the economy, especially in housing, which could depress real-estate values in some areas. Some of the immigrants own houses, and they have to sell them fast, which has glutted the resale market in the state. Secondary markets like furniture and home improvement have slowed considerably in Arizona, too.
Proponents of federalism often refer to states as laboratories for political experiments. Arizona's efforts on employer sanctions will prove an interesting test case for employer-based immigration sanctions.