The effect of employer enrolment in E-Verify on low-skilled U.S. workers

ABSTRACT

U.S. employers can check whether the workers they hire are legally eligible for employment using E-Verify, a free electronic system run by the federal government. We use confidential data from the U.S. Department of Homeland Security to provide the first examination of whether increases in employer enrolment in the E-Verify system affect employment and earnings among workers who are particularly likely to be unauthorized, namely Hispanic non-naturalized immigrants who have not completed high school, and their U.S.-citizen counterparts. We find evidence of negative effects on likely unauthorized immigrant men but positive effects on women. We find little evidence of effects on U.S. natives. These results are robust to instrumenting for endogenous employer enrolment with state laws that require some or all employers to use the E-Verify system. The results are consistent with a household model of labour supply among unauthorized immigrants.

KEYWORDS:

• Employment eligibility verification
• E-Verify
• undocumented immigrants
• illegal immigrants

JEL CLASSIFICATION:

• J15
• J31
• J61

Acknowledgments

We thank Sarah Greer for excellent research assistance. The E-Verify enrollment data used here are confidential data supplied to Pia Orrenius by the Department of Homeland Security. The views expressed here are solely those of the authors and do not reflect those of the Federal Reserve Bank of Dallas or the Federal Reserve System.

Disclosure statement

No potential conflict of interest was reported by the authors.

Additional information

Funding

This research did not receive any specific grant from funding agencies in the public, commercial, or not-for-profit sectors.