Hopeful Workers, Marginal Jobs: LA's Off-the-Books Labor Force

Economic Roundtable Research Report, 2005

72 Pages Posted: 2 May 2016

See all articles by Daniel Flaming

Daniel Flaming

Economic Roundtable

Brent Haydamack

Economic Roundtable

Pascale Joassart-Marcelli

San Diego State University

Date Written: December 5, 2005

Abstract

There is extensive evidence of a growing informal labor force in Los Angeles City and County, along with stagnant employment in the formal labor market. Between 2000 and 2004, the working age population in the county grew by 4.9 percent, but the number of wage and salary jobs (i.e., the formal economy) declined by 2.3 percent. This trend in Los Angeles’ economy is in distinct contrast to national trends. When we look at the United States economy we see a much narrower gap between the number of household members who report being employed and the number of workers that employers report having on their payrolls.

The most compelling reason for workers to accept informal jobs is economic desperation. We have evidence that many working-poor residents of the city and county, including US citizens, accept jobs in the informal sector, but the group of workers who have the greatest difficulty finding employment is recent immigrants. The evidence suggests that non-citizen immigrants are a major component of the informal labor force. Foreign-born persons made up an estimated 11 percent of the US population, 36 percent of Los Angeles County’s population, and 40 percent of Los Angeles City’s population in 2000. We project that undocumented immigrants account for 25 percent of the foreign-born population of the city and 23 percent in the county. Our best estimate is that on a typical day in 2004 there were 679,000 informal workers in the county and 303,800 in the city. These workers are estimated to account for 15 percent of the county labor force and 16 percent of the city’s labor force. Undocumented workers are estimated to make up 61 percent of the informal labor force for the county and 65 percent for the city.

Keywords: California, Data Anomalies, Economic Desperation, Foreign Born, Immigrants, Industries, Informal Economy, Labor Market, Legal Immigration, Los Angeles, Los Angeles County, Public Cost, Social Safety Net, Under the Table Jobs, Undocumented, Unreported Jobs

JEL Classification: C81, D63, H26, I31, J21, J23, J24, J31, J38, J61, J64, J68, J71, J78, M55, 015, R58

Suggested Citation

Flaming, Daniel and Haydamack, Brent and Joassart-Marcelli, Pascale, Hopeful Workers, Marginal Jobs: LA's Off-the-Books Labor Force (December 5, 2005). Economic Roundtable Research Report, 2005, Available at SSRN: https://ssrn.com/abstract=2772272

Daniel Flaming (Contact Author)

Economic Roundtable ( email )

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Brent Haydamack

Economic Roundtable ( email )

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Pascale Joassart-Marcelli

San Diego State University ( email )

San Diego, CA 92182-0763
United States

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