Puerto Ricans are used to being treated as second class citizens. Although they are Americans, the nearly four million who live on the island don’t have a representative in Congress who can vote for policies that affect them, they can’t vote for a president who sends its citizens to war, and they receive a fraction of the benefits that other American citizens do, while those born and raised on the mainland are sometimes referred to as “not real Americans,” albeit quite ignorantly.  

The one advantage Puerto Ricans have always maintained is that of comprising a well-educated, yet less costly pool of labor. The president’s executive action on immigrants will reduce that advantage, effectively hurting the second largest group of Hispanics in the U.S. as well as the already fragile Puerto Rican economy.

Given the slow recovery from the previous recession, and the several major economies around the world that are teetering on edge, our country doesn’t need a reason to further suppress economic growth by creating an even tighter labor force with lower wages on top of additional federal expenditures.

- Justin Vélez-Hagan

Puerto Ricans living on the island are among the most well-educated and skilled in many parts of the Western world, success that is due to prolific and cheap education. With more than 50 institutions of higher learning and tuition costs far lower than the average American university, Puerto Rico graduates nearly 25,000 bilingual students every year, nearly half of these are in highly demanded STEM fields. There is no other place in the country that produces so many Hispanic STEM graduates.  

The opportunity for American businesses to partner with these universities helped develop a robust manufacturing industry in pharmaceuticals, and more recently growing industries in technology and aeronautics. Over a period of decades, large manufacturers have relied upon Puerto Rico’s well-educated, yet cost competitive labor market (combined with federal and local tax incentives), which has kept its tenuous economy afloat. Companies across the U.S., and from around the globe, interested in adding the label “Made in America” to their products, while advertising goods that are produced by American labor, can find no other place in the country to do so at such competitive costs. Puerto Rico and its people have relied upon these advantages since it became part of the United States.

Puerto Ricans born and raised on the mainland have the advantage of growing up with American culture and native English language skills, many of whom are also bilingual and have an understanding of Hispanic culture in general.  Companies, large and small, are starting to realize the benefit that such diversity in skills and culture can add to their bottom line, often seeking Puerto Rican labor just for this reason.  In fact, just yesterday, a large service company based in Texas contacted my organization looking to add Puerto Rican labor, from both the mainland and the island, to its payroll.  

When the labor pool of legal American workers increases by millions of people, basic economics teaches us that as the supply of labor, and competition for jobs, increases, wages will be depressed.  If there are not enough jobs to fulfill the increased demand (and there aren’t), unemployment will rise. On the mainland, Puerto Ricans will lose their “legal” competitive advantage, just like they will on the island, where an increasing number of Dominican migrants are competing for the few low-wage jobs available to the ever-shrinking Puerto Rican labor force.  

Ironically, as some mainland Americans complain about Puerto Ricans in the diaspora “taking” jobs from blue-collar workers, Puerto Ricans also won’t be able to compete with the influx of even lower wage labor entering Puerto Rico or in the rest of the U.S. A tight labor market for low-income Puerto Ricans will be made even tighter, pushing many more of these American citizens to reliance on the welfare system, straining the rest of the country’s finances. Fewer win that lose.  

Depending on how many of the total number of new legal workers there are in the U.S., Puerto Ricans may find that they cannot be competitive anywhere without some additional, and often unattainable, educational or skills advantage.  

Far too many who come to our country seeking opportunity get caught up in a terribly inefficient and outdated immigration system, often punishing those who attempt to comply with the law by pummeling our brightest applicants with paperwork, fees, and never-ending waiting lines. But, near sighted executive action has unintended side effects that the president is clearly not considering, or just doesn’t care about any more.  

Given the slow recovery from the previous recession, and the several major economies around the world that are teetering on edge, our country doesn’t need a reason to further suppress economic growth by creating an even tighter labor force with lower wages on top of additional federal expenditures. For Puerto Ricans, the worse news is that few will notice how millions of us will, once again, suffer the brunt of the consequences.

Justin Vélez-Hagan is the founder of The National Puerto Rican Chamber of Commerce and an economic policy researcher at the University of Maryland. He is also the author of The Common Sense behind Basic Economics. He can be reached at JustinV@NPRChamber.org or @JVelezHagan.

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