I once again come to my loyal google researches in search of some help
before my final exam for my economics 102 class.  Please provide some
insight on the following topic.

Many people think that immigration into the U.S., because it causes
competition for jobs, will lower the wage rate of U.S. workers.  Yet,
even though the U.S. admits hundreds of thousands of immigrants each
year, the average wage rate has continued to grow.  Can you explain
why?  Are there groups of workers within the economy for whom the fear
of lower wages is justified?  Explain.

Although increasing the labor supply will, other things being equal,
tend to depress wage rates, labor actually consists of many different
submarkets.  As a result, wages can differ greatly among groups
because many noncompeting groups exist.  For professions and skilled
trades, it takes a large investment of time and money to become a
skilled practitioner.  Once people specialize in a particular
occupation, they become part of a particular labor submarket.  They
are subject to the supply and demand for that skill and will find that
their own labor earnings rise and fall depending upon events in that
occupation and industry.

Immigrants traditionally have had a shortage of skills, frequently
confining them to jobs involving hard physical labor, tedium, low
social prestige, and irregular employment.  People who have a choice
to work in other fields will do so, meaning that many of these jobs
could not be filled at existing pay scales if immigrants were not
present.  However, because most immigrants cannot effectively compete
in many occupations, wages for those occupations are not adversely
affected by the continuing influx of immigrants and can therefore
rise.  So, while workers with few skills rightly fear the effect of
immigration on wages, continued increases in wages for more highly
skilled positions can result in continued growth in the average wage
rate in United States.

Sincerely,

Wonko

Reference: Economics, 14th edition, Samuelson & Nordhaus, McGraw-Hill
Inc., 1992, pages 234-238