Oregon Office of Economic Analysis

International migration is one piece of the labor force puzzle. Now, Oregon is not a major port of entry into the U.S. unlike the Californias, Floridas, and New Yorks of the world. However, foreign-born households do find their way to Oregon just like US-born households do. Oregon’s share of the population that is foreign-born (9.8%) is a bit below the national average (13.5%) but ranks 18th highest among all states and DC (2020 ACS 5 year estimates).

The issue is net international migration is at the lowest level in decades according to the latest Census estimates. The pandemic obviously didn’t help, but international migration to the U.S. peaked in 2016 and slowed noticeably in the late 2010s.

In terms of direct labor implications, the number of prime-age, foreign-born Americans and Oregonians hasn’t just slowed, but has declined outright. In Oregon, from 2016 to today, there are 90,000 fewer prime-age, foreign-born individuals. Keep in mind this is a noisy data series and we don’t want to make a mountain out of a mole hill. However, relative to the underlying trend, there are now 68,000 fewer such Oregonians.

Prime-age, foreign-born Oregonians have a labor force participation rate in the 80-82% range depending upon the year. The 68,000 below trend figure directly translates into 55,000 fewer available workers in the local economy. With around 100,000 job vacancies today in Oregon, it sure seems like businesses could use more labor to adequately staff and grow their operations.

In terms of which sectors of the economy are impacted the most, let’s turn to the 2019 ACS data. This provides a pre-pandemic snapshot of the labor force.

Overall, every single industry has foreign-born workers. No industry is likely immune to the slowdown in international migration or outright decline in available workers. That said, goods producing industries like natural resources (crop production), construction, and manufacturing have above-average shares. Also, larger shares are seen in the leisure and hospitality industry, and in addition the parts of professional and business services that include janitorial, landscaping, and waste management.

On one hand, the decline in foreign-born workers is mathematically large enough to basically fully explain the tight labor market. However we know it’s never so simple to just isolate and pull out a small piece of a big network. The labor market is still rebounding from the pandemic, and participation rates are picking up. Migration flows are likewise returning, helping to boost the available number of workers. But it is clear nationally and here in Oregon that international migration, and foreign-born workers are a piece to the puzzle. This is particularly true now that the labor market is structurally tight for demographic reasons as the birth rate declines and the large Baby Boomer cohort continues to retire.