The Seattle Times: Local News: Low-paid illegal work force has little impact on prices
More than 7 million illegal immigrants work in the United States. They build houses, pick crops, slaughter cattle, stitch clothes, mow lawns, clean hotel rooms, cook restaurant meals and wash the dishes that come back.
You might assume that the plentiful supply of low-wage illegal workers would translate into significantly lower prices for the goods and services they produce. In fact, their impact on consumer prices — call it the "illegal-worker discount" — is surprisingly small.
The bag of Washington state apples you bought last weekend? Probably a few cents cheaper than it otherwise would have been, economists estimate. That steak dinner at a downtown restaurant? Maybe a buck off. Your new house in Subdivision Estates? Hard to say, but perhaps a few thousand dollars less expensive.
The underlying reason, economists say, is that for most goods the labor — whether legal or illegal, native- or foreign-born — represents only a sliver of the retail price.
Consider those apples — Washington's signature contribution to the American food basket.
At a local QFC, Red Delicious apples go for about 99 cents a pound. Of that, only about 7 cents represents the cost of labor, said Tom Schotzko, a recently retired extension economist at Washington State University. The rest represents the grower's other expenses, warehousing and shipping fees, and the retailer's markup.
And that's for one of the most labor-intensive crops in the state: It takes 150 to 190 hours of labor to grow and harvest an acre of apples, Schotzko said, compared to four hours for an acre of potatoes and 1 ½ hours for an acre of wheat.
