What is the link between immigration and job growth?

Daniel Weintraub:

A major piece of conventional wisdom about immigrants _ that newcomers take jobs away from native Americans _ has been questioned in a new study of urban job growth by a Harvard Business School professor and expert on inner city economics.

The study, in fact, seems to show just the opposite: Cities with higher concentrations of immigrants are the places where the number of jobs is growing the fastest.

The research by Michael E. Porter, founder of the Initiative for a Competitive Inner City, found that about half of the 80 largest inner cities in America had job growth between 1995 and 2003.

Inner cities that lost jobs and those that gained them tended to have similar percentages of minority residents, and their residents had about the same level of high school and college education.

But the two groups of cities differed sharply when it came to one demographic measure: immigration. Inner cities that gained jobs had populations that, on average, were 31 percent immigrant. Inner cities that lost jobs had populations that averaged just 12 percent immigrants.

"There is a direct correlation between immigrant populations and job growth in inner cities," Porter writes. "Immigrants clearly and more readily identify the unique business conditions and opportunities that inner cities offer and are able to capitalize upon them. In addition, they are attractive to small and large businesses seeking willing and available labor."

A crucial question left unanswered by Porter's study is the extent to which immigrants cause job growth or are attracted by it. If the presence of immigrants in an economy leads to more business creation and job growth, then that is a very important finding. If immigrants are merely more likely to go to a place that already has a vibrant economy, then the connection between their presence and job growth is not as significant.

Why are economists such blatant fools about immigration?