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David Farkas

Fewer customers, fewer undocumented aliens
October 6, 2008

To go with your morning coffee, here's another glum report that spending for restaurants and consumer goods is plummeting. A restaurant analyst says she expects September to be the worst sales month this year:

Casual dining restaurants, which have struggled in recent years because of a glut of restaurants and higher-quality fare at fast-food chains, have taken a beating already this year, forcing the Bennigan’s chain to close and leaving several others struggling. “I think September could be the worst month of the year, and we’ve had a lot of bad months,” said Lynne Collier, an analyst at KeyBanc Capital Markets who covers the restaurant industry.

Fewer customers means fewer workers. Interestingly, one pool of restaurant employees -- undocumented workers -- is shrinking, according to the Pew Hispanic Center. Research suggests that "the inflow" of undocumented people dropped below legal immigrants, reversing a 10-year trend. The turnaround probably began last year.

The Pew Hispanic Center also estimates that inflows of unauthorized immigrants averaged 800,000 a year from 2000 to 2004, but fell to 500,000 a year from 2005 to 2008 with a decreasing year-to-year trend. By contrast, the inflow of legal permanent residents has been relatively steady this decade. Although the growth of the unauthorized population has slackened, its size has increased by more than 40% since 2000, when it was 8.4 million. In 2005, the Pew Hispanic Center estimated there were 11.1 million undocumented immigrants in the United States. The most recent estimate, 11.9 million, indicates that unauthorized immigrants make up 4% of the U.S. population.

The study doesn't reveal why the decline is taking place but researchers speculate that a bleak economy and stricter law enforcement, particularly along the Mexican border, may be part of the cause.