Impacts of Hispanic Population Growth on Rural Wages

Although earnings generally increased in rural areas in the 1990s, Hispanic population growth led to lower wages for at least one segment of the rural population—workers with a high school degree (skilled workers), particularly men in this skill group. Using data from the Bureau of Economic Analysis and the Current Population Survey, this report examines the effects of Hispanic population growth on rural wages. The analysis combines approaches from earlier immigration-impact studies and more recent work that incorporates the role of labor demand in the labor market. The analysis finds that labor demand shift factors and other area-specific factors that often are not included in immigration studies are important. Results indicate that labor demand increases favored skilled workers (those with a high school degree) overall but favored unskilled and professional workers in some rural industries. Thus, the increased supply of unskilled labor from Hispanic population growth led to lower wages for skilled men as a result of production changes in some parts of the rural economy.