Does Small Biz Want Immigration Reform?

Health care, insurance liability, and taxes are still bigger worries, according to the National Federation of Independent Business

The ongoing debate and recent demonstrations surrounding immigration reform are being watched closely by politicians, citizens, and business people alike. One group that is paying particularly close attention is small-business owners (see BW Online, 5/2/06, "The Immigration Tightrope").

According to a study published by the Pew Hispanic Center, last year there were almost 12 million unauthorized migrants living in the U.S., which accounted for nearly 5% of the civilian labor force. These individuals work mostly in service-sector jobs such as farming and agriculture, cleaning, construction, and food preparation -- all areas which directly affect small business.

In April, the National Federation of Independent Business (NFIB), a Washington-based advocacy group that represents small and independent businesses, released a survey conducted among its 600,000 members regarding the issue of illegal immigration. BusinessWeek Online staff writer Stacy Perman spoke recently to Brad Close, the NFIB's director of federal public policy regarding the organization's members and their attitudes toward immigration and the reform debate. Edited excerpts of their conversation follow:

According to your recent survey, more than 90% of NFIB small-business owners surveyed believe that illegal immigration is a problem, with 70% ranking it as a "very serious" or "serious" problem, and 86% saying it should have a "very high" or "high" priority for Congress and the Bush administration. Given that response, what is the prevailing view among your members regarding illegal immigration?

Within the debate in general, our members are approaching it from [the perspective] of fairness in competition. In our survey, the majority of our members supported penalizing business owners who knowingly hire illegal workers. The key is "knowingly." There is competition out there that is unlawful [that] undercuts folks because they are not paying the benefits or taxes mandated by law.

What is this suggestive of?

It shows the main issue is not that immigrant labor is taking away jobs or causing them to go out of business [because] immigrants [are] opening businesses. It is the cost to the economy that is their concern. Most [of our members] support increasing penalties to those who employ illegal workers. They don't see it as an undue burden to verify the immigration status of potential employees.

Where do NFIB members fall on the reform initiatives before Congress, for example a guest worker program?

[On the guest worker] issue, [their] position is different than a lot of other folks. Whereas a lot of businesses are very supportive of creating guest worker programs, our members are evenly split down the middle.

And where do they stand on creating some type of path to citizenship?

Again, somewhat mixed. I think we asked them...if they support or oppose amnesty for illegal immigration. There was nearly a 60% opposition rate. It is in line with [their position on] guest workers. Our members' definition of "guest worker" is [someone] who comes to work here [who would be required to return home] if they want to apply for citizenship rather than [have] a path to citizenship or amnesty [here in the U.S.].

But [our members] remain mixed on both issues. [About] half said no to amnesty under any circumstance. And they are equally split on amnesty for illegal immigrants who are employed but are not using government services.

And what is the attitude among your members toward legal immigration?

First it is to set up a legal standard for how to let immigrants into the country. 44% say it should be first on the basis of job skills, 22% on family ties, and 20% on a first come, first served basis.

Where does immigration stand on the scale of priorities for small business owners?

Every four years we do a policy study of the top priorities. In the last report in 2004, the top issues were health care and insurance liability and taxes. In 2004 immigration didn't rank as a top priority. I'd still say it is not at the top now. It's still health care, taxes, and legal reform.

Before it's here, it's on the Bloomberg Terminal.