Employer sanctions will slow economy

Starting Tuesday, Arizona will test a widely held belief that Americans are willing to endure higher consumer costs and economic hardships as the price required to improve border security and to drive away illegal immigrants already in this country.

The state’s new employer sanctions law goes into effect on New Year’s Day, empowering county prosecutors for the first time to hold accountable businesses that knowingly hire foreign citizens who don’t have the federal government’s permission to work here.

It’s rather unclear how or when the law actually will be enforced. Maricopa County Attorney Andrew Thomas and his 14 counterparts around the state have provided few details about what they will do, other than to tell a federal judge they do not expect any cases to arise before Feb. 1.

We do know many immigrants, both legal and illegal, are assuming the law will effectively restrict their ability to find and hold a job. Tribune writer Paul Giblin reported a week ago that an unknown number of such immigrants already have left Arizona to search elsewhere and that process is likely to accelerate in the coming days.

That alone would make the employer sanctions law a clear triumph for its supporters, if Arizona had a sizeable pool of American-born residents ready to take over those vacant jobs. But economists who don’t have a political agenda strongly agree that no such replacement pool exists.

Unemployment rates have been at historic lows for years because of declining U.S. birth rates. The vast majority of those out of work already find another job relatively easily or are chronically unable to put in a full day on the clock. Government analyses confirm that recent U.S. economic expansion has depended heavily on immigrants, a large number of whom have come here illegally.

As those workers disappear, the iron-clad law of supply and demand will kick in. Arizona businesses that rely heavily on immigrant labor — agriculture, construction and the hospitality industry — will try to attract new employees by raising their wages. Those who are successful will pass their costs on to consumers through higher prices for food, homes and other goods and services. Businesses that can’t find new workers at any salary level will be forced to scale back production or, in extreme cases, simply disappear.

Either way, negative ripples will spread through the economy to potentially threaten the jobs and livelihoods of everyday American citizens. When that economic damage truly becomes evident is when we will begin to gauge the public’s acceptance of cracking down on illegal hirings when Congress hasn’t offered new avenues for foreign workers to legally enter the U.S.

Advocates of an enforcement-first strategy offer a rosy picture of being able to gradually adjust immigration policy with little damage to the economy. Those who have to make decisions every day affecting the health of their own companies know otherwise. That’s why their lobbyists and lawyers fought so hard to prevent the state from enforcing employer sanctions.

So far, the courts have ruled in favor of the law, and so it goes into effect unimpeded Tuesday.

We have consistently supported policies and actions aimed at securing America’s borders so we can have a reasonable level of confidence that terrorists and serious criminals are denied entry.

But we still don’t favor the current trends of expanding government powers further into our personal lives and of interfering with the free market by raising business costs through yet more regulations and mandates.