Labor economics isn’t known for having the most accessible lexicon. Phrases like “human capital” and “skills gap” can have a variety of interpretations depending on the context. Complementarity is another vague, nondescript term in the field, but for all its characterlessness, it might just describe one of the most prominent forces in today’s labor market.
Few things in economics happen in isolation, and complementarity occurs when one piece of the economic puzzle functions better or more productively when paired with another input. Workers are a clear winner thanks to this economic rule, with most employees benefiting enormously when others, such as immigrants, are allowed to participate in the workforce. The catch with complementarity, however, is that its effect is most noticeable when one part of the pairing gets stripped away.
The authors found that in an average area that saw a surge in ICE activity, 7,574 likely undocumented male workers stopped working, coming out to around six males leaving the workforce for every ICE arrest, primarily out of fear of being arrested themselves.
“Chilling effects capture the fact that heightened ICE activity may cause people to be fearful of participating in their regular activities—including going to work,” the study’s authors wrote.
At the same time, because of complementarity, U.S.-born males with a comparable education level and who work in sectors reliant on immigrant labor, such as construction or agriculture, also dropped out of the workforce in greater numbers. In an average high-enforcement area, the number of U.S.-born male workers fell by 1,200, the authors found, coming out to approximately one job loss for every six likely undocumented workers who left the labor force.
“This is consistent with a model where undocumented immigrants and U.S.-born workers are complements, rather than substitutes for each other in the labor market,” the researchers said.
In sectors such as construction, where the share of immigrant workers is high, U.S.-born workers often take up roles that depend on work provided by foreign-born counterparts, such as manual labor. Without immigrant workers, the business model foundation crumbles, and the industry at large has to scale back or shut down, reducing demand for U.S.-born work in the process.
The more realistic outcome is what businesses usually do when a labor supply dries up: scale back their operations.
“There is a common narrative out there that mass deportations will free up job opportunities for U.S.-born workers, but numerous studies, including ours, have shown that is false,” said East. “If a construction company can’t find laborers, they’re going to take on less work and hire fewer people overall.”
