Update on Carbon Capture and Storage [feedly]

summarizing a new UN report on carbon capture and its role in meeting emissions targets.

Update on Carbon Capture and Storage
http://conversableeconomist.blogspot.com/2019/12/update-on-carbon-capture-and-storage.html

In my experience, carbon capture and storage (CCS) is often viewed as a quirky technological possibility, not of central significance to the overall issue of reducing the rise of atmospheric carbon. This perception is incorrect. The Global CCS Institute provides an overview in Global Status of CCS 2019. As the report notes: 

Analysis by the Intergovernmental Panel on Climate Change (IPCC) and International Energy Agency (IEA) has consistently shown that CCS is an essential part of the lowest cost path towards meeting climate targets. The IPCC's Fifth Annual Assessment Report (AR5) showed that excluding CCS from the portfolio of technologies used to reduce emissions would lead to a doubling in cost - the largest cost increase from the exclusion of any technology. ... To limit global temperature rises to 1.5°C above pre-industrial levels, the world must reach net zero emissions by around 2050. Most modelling scenarios show that this will require significant deployment of negative emissions technologies. Bioenergy with CCS (BECCS) is one of the few available that can deliver to the necessary scale.

In the report, Nicholas Stern adds:

One of the opportunities that we have at hand, carbon capture, use and storage, will play a vital role as indicated by the Intergovernmental Panel on Climate Change's Report on Global Warming of 1.5 ºC. The diversity of its applications is immense; from direct air capture delivering negative emissions, to the ability to prevent infrastructure emissions lock-ins by abating existing infrastructure in the industrial and power sectors, capturing, using and storing carbon will be a vital instrument in reaching net-zero emissions goals.

The report offers a detailed overview of report of CCS facilities around the world in various stages from early development to actually operational. However, the actual operational CCS facilities are currently measured in dozens, when they need to be measured in hundreds or thousands. Sally Benson, a professor of energy engineering at Stanford, writes about CCUS, or "carbon capture, utilization, and storage":

Over the last 20 years, the role of carbon capture and storage has evolved from "nice to have," to "necessary," and now, CCUS is inevitable. We need Gt* scale CCUS now. ... [W]e have an ambition gap between the rate that CCUS is growing today – about 10 per cent a year, compared to the rate needed to reach a Gt/year by 2040. If we could just double scale-up rate to 20 per cent per year, and sustain that to 2040, bingo, we reach 1 Gt/year by 2040.

Here's a partial sense of the range of possibilities for CCS. Perhaps the most obvious is to apply this technology at places where fossil fuels are being burned. For example, when burning natural gas:

Eliminating almost all greenhouse gas emissions along the natural gas value chain is necessary if we are to meet the target of net-zero emissions by mid-century. More than 700 Mtpa of indirect CO2 emissions – almost equal to the emissions of Germany in 2016 – could be eliminated from oil and gas operations through the application of CCS. Applying CCS at gas processing facilities costs around USD 20-25 per tonne of CO2.

But the technology can also be applied to other industrial operations that emit high levels of carbon, including factories that make cement, steel, and certain chemicals.

The good news is that as CCS expands in various ways, the cost of reducing carbon emissions in this way is falling.

There is strong evidence that capture costs have already reduced. ... Two of the projects, Boundary Dam and Petra Nova are operating today. The cost of capture reduced from over USD100 per tonne CO2 at the Boundary Dam facility to below USD per tonne CO2 for the Petra Nova facility, some three years later. The most recent studies show capture costs (also using mature amine-based capture systems) for facilities that plan to commence operation in 2024-28, cluster around USD 43 per tonne of CO2. New technologies at pilot plant scale promise capture  costs around USD33 per tonne of CO2.

Just storing carbon underground is certain possible, but from an economic view, it's more productive to store the carbon in a form that gets some additional economic value from it.  One of the most prominent existing economic uses for stored CO2 is--heavy irony alert here--injecting it underground to extract more oil. But there are other examples: captured CO2 might be used as a feedstock for certain chemicals, polymers, concrete, and even fuels.

One possible future use for captured carbon emphasized in the report is in the production of clean hydrogen. There some recent buzz that clean-burning hydrogen might be greatly expanded in the future, but the question is how that hydrogen gets produced in first place. The report notes:

Currently, 98 per cent of global hydrogen production is from unabated fossil fuels, around three quarters stemming from natural gas. CO2 emissions from its production are approximately 830 Mtpa, equivalent to the annual emissions of the UK in 201894. ... Low-carbon hydrogen has been produced through gas reforming and coal gasification with CCS, for almost two decades. For example, the Great Plains Synfuel Plant in North Dakota, US, commenced operation in 2000 and produces approximately 1,300 tonnes of hydrogen (in the form of hydrogen rich syngas) per day, from brown coal.  Hydrogen produced from coal or gas with CCS is the lowest cost clean hydrogen by a significant margin and requires less than one tenth of the electricity needed by electrolysis.

Finally, discussions of this topic inevitably veer into the possibility of "bio-energy with carbon capture and storage," or BECCS. This notion here is to burn biomass of some kind for energy--like wood pellets--but then to capture and store the carbon. This would be a form of "negative carbon" energy. This approach might only make economic sense in a limited number of locations, but it's because it's an actual subtraction of carbon from the atmosphere, it's worth keeping in mind. 

I'll just add that focusing carbon capture and storage on the industrial sector does not exhaust the possibilities. For example, I've noted some evidence that saving the whales could lead to increased ocean plankton and store additional carbon in that way.  As another approach, certain agricultural methods have the result of sequestering more carbon in the soil, as discussed by Greg Ip in the Wall Street Journal, "How to Get Rid of Carbon Emissions: Pay Farmers to Bury Them," September 11, 2019).  For exampleA Boston-based company called Indigo Ag Inc. is setting up a market where those who want or need to reduce their carbon emissions can pay farmers $15 to follow practices that will have the effect of sequestering  one metric ton of carbon dioxide in the soil.

Perhaps the most aggressive and unproven possibilities for carbon capture and storage involve finding ways to extract carbon from the air directly. Of course, such methods only work if most of the energy going into them comes from non-carbon sources. For example, there's ageothermal power plant in Iceland which is drawing carbon out of the air--admittedly at modest scale--and then using a chemical process to turn the carbon into rock. If this technology advances and becomes more cost-effective, it will be interesting to calculate whether geothermal energy sites around the world might be used for this purpose.

Another technology that seems like a promising long-shot (if that's not a contradiction in terms) is being pushed by Project Vesta. Their website is full of position papers and background research arguing that if olivine rock was spread on beaches, it will undergo a chemical reaction as it mixes with seawater that absorbs CO2 from the atmosphere and turns it into rock. The project offers theoretical calculations that this approach could negate all of the current levels of atmospheric carbon emissions at a plausible cost--but they are just now working on a "test beach" experiment to get hard evidence.

Other than the enthusiasts at Project Vesta, none of the sources described here make any claim that carbon capture and storage can be a sufficient answer to holding down the rise of atmospheric carbon. But many of the sources here see it as a necessary and underappreciated part of the overall puzzle. Ultimately, the growth of a CCS industry is going to depend heavily on government. If the government provides clear incentives for carbon emissions to decline, like a carbon tax or regulations, then CCS will grow faster. If the government in addition makes it straightforward to site carbon storage areas without undue regulatory delays or legal risks, and add some financial incentives for such investments, then CCS will grow faster still  

 -- via my feedly newsfeed

Rents Have Risen More Than Incomes in Nearly Every State Since 2001 [feedly]

Rents Have Risen More Than Incomes in Nearly Every State Since 2001
https://www.cbpp.org/blog/rents-have-risen-more-than-incomes-in-nearly-every-state-since-2001

Growth in median rents has outpaced growth in median renter income since 2001 in nearly every state, as we explain in our updated state rental assistance fact sheets. About 23 million low-income renters pay more than half of their income for housing, partly due to this gap between rental costs and income. While the need for additional federal rental assistance continues to grow, federal investment largely remains stagnant.

Renters' incomes generally are recovering from the 2001 and 2007-2009 recessions but, in nearly half of states, the median renter household still earned less in 2018 than in 2001 in inflation-adjusted terms. At the same time, rental costs have risen, including in states where real incomes have fallen. The inflation-adjusted cost of the typical apartment (median rent and utilities) has grown in every state since 2001, with some states home to extreme spikes: rental costs rose 30 percent in California, 40 percent in Hawaii, and 59 percent in the District of Columbia between 2001 and 2018. Delaware and New Hampshire have some of the largest gaps between median rents and median renter incomes; in the latter, real incomes fell 19 percent between 2001 and 2018, while real housing costs grew 8 percent during that time. (See graphic below.)

Rental costs haven't risen as dramatically in every state. In Arkansas, Indiana, Ohio, and Wisconsin, inflation-adjusted rental costs have grown less than 3 percent since 2001. Nevertheless, the real incomes of many renters in these states have dropped since 2001, meaning more affordable housing is still out of reach for many. In Ohio, the typical apartment costs essentially what it did in 2001, but the typical renter household earns 9 percent less.

Typical workers haven't seen their wages grow in years, yet the cost of rental housing continues to rise, squeezing household budgets. A parent working full-time earning the federal minimum wage cannot afford a modest two-bedroom apartment in any state without receiving rental assistance or making tough choices between paying the rent or meeting essential daily needs such as food, medicine, and child care. Parents aren't the only ones struggling to afford their rent. Most working-age, non-disabled renters are working, but at jobs with wages too low to pay the rent.

When low-income renters can't find a decent, affordable home, they're likelier to face eviction and homelessness. Renters across the country pay more than half their income for rent, our fact sheets show, and people in every state, particularly children, experience homelessness. (For more on how to use our rental assistance fact sheets, see our new guide).

Despite the need for rental assistance, more federal dollars go to homeownership subsidies that mainly benefit higher-income households. Fully 3 in 4 low-income renter households in need don't get rental assistance due to limited federal funding. If rents continue to rise, housing affordability problems could worsen, particularly if another recession strains family budgets.

In the short term, the President and Congress should fully fund federal rental assistance for the 10 million low-income renters who now rely on it to afford their homes. Given the overwhelming need, states and localities should also develop or strengthen their own rental assistance programs.

In the long term, policymakers should make significantly expanding rental assistance a top priority for housing policy. Our communities only thrive when we all have access to decent, affordable housing and a roof over our heads.

United StatesAlabamaAlaskaArizonaArkansasCaliforniaColoradoConnecticutDelawareDistrict of ColumbiaFloridaGeorgiaHawaiiIdahoIllinoisIndianaIowaKansasKentuckyLouisianaMaineMarylandMassachusettsMichiganMinnesotaMississippiMissouriMontanaNebraskaNevadaNew HampshireNew JerseyNew MexicoNew YorkNorth CarolinaNorth DakotaOhioOklahomaOregonPennsylvaniaRhode IslandSouth CarolinaSouth DakotaTennesseeTexasUtahVermontVirginiaWashingtonWest VirginiaWisconsinWyoming

Change in Median Rents and Incomes Since 2001

adjusted for inflation

• Median rent (including utilities)
• Median renter household income

'01

'03

'05

'07

'09

'11

'13

'15

'17

-20%

-10%

0%

10%

13%

0%

Source: CBPP tabulations of the Census Bureau's American Community Survey

CENTER ON BUDGET AND POLICY PRIORITIES | CBPP.ORG

 -- via my feedly newsfeed

Dean Baker: General Trump’s Strange Offensive in His Trade War [feedly]

General Trump's Strange Offensive in His Trade War
http://cepr.net/publications/op-eds-columns/general-trump-s-strange-offensive-in-his-trade-war

Just when many policy types thought that Donald Trump was about to wind down his trade war with China and work out a deal, he announced that he was in no rush to reach an agreement. He said that he might wait until after the election next year, boasting about the "massive" amount of money he was pulling in from his tariffs.

In addition to his China attack, Trump also imposed tariffs on steel and aluminum from Argentina and Brazil, complaining that they were manipulating their currencies. Moreover, his administration announced plans to put a tariff as high as 100 percent on wine and cheese imported from France in retaliation for France's plans to tax internet services. This tax will largely hit U.S. tech giants like Google and Facebook.

Each of these moves by themselves would seem a bit peculiar; taken together they are truly bizarre. This is similar to a general ordering randomly fired artillery shots. Some hit the opposing army, some hit civilian targets and some shoot backward at his own troops. There is very little sense in what Trump is doing here.

Starting with the China trade war, which is certainly the most economically important, the cycle of retaliatory tariffs is the largest cause of uncertainty in the economy today. Economists often overplay the risks posed by uncertainty, but in this case, they are very real.

It is difficult for a company to plan an investment strategy if it has no idea if tariffs against China will be near zero next year, 25 percent (as they are now for many products), or whether imports from China will be banned altogether, as Trump once threatened. Investment has actually turned negative this year, and the uncertainties created by the trade war are almost certainly the major reason. This has been a major drag on the economy's growth in 2019, which now looks to continue into 2020.

Trump's boast about the "massive" amount of revenue he is getting from his tariffs is bizarre. Apparently, he does not understand that tariffs are taxes, and they are being paid almost entirely by consumers and retailers in the United States.

We know this because the Bureau of Labor Statistics reports every month on the price of goods imported from China. Over the last year, they have fallen by just 1.6 percent. This means, as a first approximation, that if we have a tariff of 25 percent, U.S. retailers or consumers are paying 23.4 percent more for the items they buy from China.

Usually, presidents don't want to be boasting about raising taxes on the middle class in an election year, but apparently Trump feels differently. As I have argued elsewhere, there is a reasonable case for pressing China to raise the value of its currency to make U.S. goods and services relatively more competitive in the world economy.

However, Trump's trade agenda with China has put currency on the back burner and focused on protecting the intellectual property of U.S. corporations. That makes sense if your goal is to redistribute even more income to Bill Gates and other rich people, but it is 100 percent antithetical to a progressive trade policy.

Instead of locking down Boeing and Microsoft's patents and copyrights, we should be focused on pooling innovation, especially in areas like clean energy and health, so that the whole world can benefit from new technology as quickly as possible. But don't look for forward thinking on trade from Trump, or really anyone else in elite policy circles.

Trump's other shots in his trade war are also difficult to understand. While the currencies of both Brazil and Argentina have fallen sharply in the last year against the dollar, this certainly has not been a policy choice. Both countries have actually made considerable efforts to stabilize the value of their currency.

Trump's steel tariffs have a sort of kick-them-when-they-are-down quality. There may be a political motivation in the case of Argentina, where a left-of-center government is taking power this month, but Brazil is being run by a far-right president who is often compared to Trump. To paraphrase the old proverb, there is no honor among fools.

Then we get to the Brie tax. France and other European Union countries are planning to tax internet companies like Google and Amazon based on where their business is rather than where they claim their profits. As it stands now, these companies claim most of their profits in low-tax countries like Ireland.

Taxing corporate profits based on sales is a policy that has been widely supported by economists, including many in the United States. A Democratic president would likely include this in a reform package if they take office in 2021.

Anyhow, to protect Google and the rest, Trump wants to make his campaign contributors pay more for their cheese and wine. This doesn't seem like good policy, but on the plus side, most of us won't have to worry about it too much.

 -- via my feedly newsfeed

Overworked America [feedly]

Overworked America
https://economicfront.wordpress.com/2019/12/03/overworked-america/

Those living in the US are encouraged to think that they live in the best country in the world with little to learn from the experiences of working people in other countries.  This sense is reinforced by the fact that the mainstream media generally discusses US problems without reference to developments or trends in other developed capitalist countries.

Here is one example: hours of work.  It is a common complaint that Americans work too many hours.  What is rarely noted, as Ryan Cooper points out in his study titled The Leisure Agenda, is that "Americans work far, far more than their counterparts in peer European nations."

The figure below, based on OECD reported data for the year 2018, shows just how much more. The average US worker works roughly 110 hours a year more than the average Japanese worker, or some 2.6 weeks more; about 265 hours a year more than the average French worker, or some 6.6 weeks more; and 420 hours more than the average German worker, or some 10.5 weeks.

The OECD defines average annual hours worked per employed person as:

the total number of hours actually worked per year divided by the average number of people in employment per year. Actual hours worked include regular work hours of full-time, part-time and part-year workers, paid and unpaid overtime, hours worked in additional jobs, and exclude time not worked because of public holidays, annual paid leave, own illness, injury and temporary disability, maternity leave, parental leave, schooling or training, slack work for technical or economic reasons, strike or labor dispute, bad weather, compensation leave and other reasons. The data cover employees and self-employed workers.

The trend in average annual hours of work in the US and other developed capitalist countries highlights just how far outside the mainstream the US labor experience is.  The following figure, again based on OECD data, is taken from Cooper's study.  As he summarizes:

As most nations have gotten richer, their average worker has worked fewer hours. But this is not true of the United States. As shown [below], among wealthy OECD nations with data going back that far, the US was in the middle of the pack among rich nations in 1970. Now, it works the most out of any in this cohort.

One reason for the higher average hours of work in the US is that it is the only major OECD country that does not provide a federal statutory minimum annual leave entitlement to its workers, as illustrated in the following figure which is also from Cooper's study.

The annual US work hours presented above is for the average worker, which means that it includes the work experience of people who are forced to work extremely long hours as well as those who cannot find full-time employment. In both cases, the US employment situation is a major contributor to the stress, poor health, and weakening community ties experienced by growing numbers of workers.

The lower average annual hours of work in other OECD countries does not mean that workers in those countries don't have their own challenges, especially as many now confront governments that seek to undermine their past gains. At the same time, it does demonstrate that there is plenty of room for improvement in the United States.

In other countries a reduction in work hours and paid annual leave entitlements were won through aggressive workplace struggle and political pressure on governments. There is, of course, a long history of struggle for a shorter workday in the US, which came to be symbolized by May Day demonstrations and strike actions, and deserves renewed attention.  It is also worth remembering that activists in that struggle were well aware that achieving a shorter work week was critical to securing for workers the time and energy needed to build a powerful working class movement for social transformation.

 -- via my feedly newsfeed

November job gains beat expectations, as Wal S’yas (reversed Say’s Law) takes hold [feedly]

November job gains beat expectations, as Wal S'yas (reversed Say's Law) takes hold
http://jaredbernsteinblog.com/november-job-gains-beat-expectations-as-wal-syas-reversed-says-law-takes-hold/

Payrolls rose by 266,000 last month and the unemployment rate ticked down slightly to 3.5%. Hourly wage growth for all private sector workers remained where it has been, up 3.1%, year-over-year, while the pay of lower-wage workers–the 82% of payroll employment that's blue collar in factories and non-managers in services–has been trending up a bit, and was up 3.7% last month (a slight tick down from 3.8% in October). With inflation running around 2%, this translates into solid real wage gains for these workers. The stronger trend for lower-paid workers is also a reminder of who disproportionately benefits from persistently high-pressure labor markets.

The November jobs number of 266K was boosted by the return of almost 50,000 strikers due to the end of the GM strike. Thus, much like we discounted the loss of those workers in the previous month's jobs report, we should discount their return (I discuss the trend in manufacturing employment below). Even so, our monthly smoother implies, if anything, there's been a slight acceleration in job gains in recent months (the smoother averages monthly payroll gains over 3, 6, and 12-month windows, and thus smooths out the strike effect).

In tandem with the wage results, payroll gains of this magnitude suggest that the persistently high-pressure labor market is boosting labor supply at both the extensive and intensive margins, i.e., pulling people in and adding hours for incumbent workers. I often stress the positive wage effects of high pressure labor markets, but the supply effects are structurally important, as they imply the potential for increased economic capacity. Fans of economic theory will recognize this as reversed "Say's Law." That is, Say's Law, which is now widely viewed as erroneous, argued "supply creates demand." It appears more accurate to argue that demand–in this case, persistently strong demand for labor–creates (labor) supply.

A hugely important policy question is whether that supply lasts past the next recession. This will surely require employment-oriented policies to avoid last-hired, first-fired outcomes when demand eventually lags. Such policies include subsidized employment, training, and apprenticeship programs.

Turning to one key, and less favorable, recent sectoral development, many different data sources have shown weakness in manufacturing employment, driven by the trade war and slower global growth. What is sometimes not emphasized enough in this context is that both of these factors tend to put upward pressure of the US dollar. As trade economist Rob Scott pointed out in a recent op-ed: "The dollar has climbed 10 percent since the tariffs first took effect in March 2018, and has also risen 11 percent against the [Chinese] yuan in the same period. This lowers the cost of imports and raises the cost of U.S. exports…"

As the next figure shows (and note the figure smooths out the strike effects), there's but a large deceleration in manufacturing job gains as the above-named factors have seriously dinged manufacturing activity.

The U.S. job market continues to post impressive job gains. While overall wage trends remain stalled, those of lower-paid workers serve as a reminder of one of the benefits of high-pressure job markets. At the micro-level, especially given low inflation, this means real paycheck gains for working Americans. At the macro-level, it means we can expect the American consumer to continue to fuel the already record-long expansion. Against this broadly favorable backdrop, Trump's trade war is a clear negative, demonstrably hurting factory workers.

 -- via my feedly newsfeed

America’s Red State Death Trip [feedly]

America's Red State Death Trip
https://www.nytimes.com/2019/12/02/opinion/life-expectancy-united-states.html

"E pluribus unum" — out of many, one — is one of America's traditional mottos. And you might think it would be reflected in reality. We aren't, after all, just united politically. We share a common language; the unrestricted movement of goods, services and people is guaranteed by the Constitution. Shouldn't this lead to convergence in the way we live and think?

In fact, however, the past few decades have been marked by growing divergence among regions along several dimensions, all closely correlated. In particular, the political divide is also, increasingly, an economic divide. As The Times's Tom Edsall put it in a recent article, "red and blue voters live in different economies."

What Edsall didn't point out is that red and blue voters don't just live differently, they also die differently.

About the living part: Democratic-leaning areas used to look similar to Republican-leaning areas in terms of productivity, income and education. But they have been rapidly diverging, with blue areas getting more productive, richer and better educated. In the close presidential election of 2000, counties that supported Al Gore over George W. Bush accounted for only a little over half the nation's economic output. In the close election of 2016, counties that supported Hillary Clinton accounted for 64 percent of output, almost twice the share of Trump country.

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The thing is, the red-blue divide isn't just about money. It's also, increasingly, a matter of life and death.

Back in the Bush years I used to encounter people who insisted that the United States had the world's longest life expectancy. They hadn't looked at the data, they just assumed that America was No. 1 on everything. Even then it wasn't true: U.S. life expectancy has been below that of other advanced countries for a long time.

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The death gap has, however, widened considerably in recent years as a result of increased mortality among working-age Americans. This rise in mortality has, in turn, been largely a result of rising "deaths of despair": drug overdoses, suicides and alcohol. And the rise in these deaths has led to declining overall life expectancy for the past few years.

What I haven't seen emphasized is the divergence in life expectancy within the United States and its close correlation with political orientation. True, a recent Times article on the phenomenon noted that life expectancy in coastal metropolitan areas is still rising about as fast as life expectancy in other advanced countries. But the regional divide goes deeper than that.

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A 2018 article in The Journal of the American Medical Association looked at changes in health and life expectancy in U.S. states between 1990 and 2016. The divergence among states is striking. And as I said, it's closely correlated with political orientation.

I looked at states that voted for Donald Trump versus states that voted for Clinton in 2016, and calculated average life expectancy weighted by their 2016 population. In 1990, today's red and blue states had almost the same life expectancy. Since then, however, life expectancy in Clinton states has risen more or less in line with other advanced countries, compared with almost no gain in Trump country. At this point, blue-state residents can expect to live more than four years longer than their red-state counterparts.

Is this all about deaths of despair in the eastern heartland? No. Consider our four most populous states. In 1990, Texas and Florida had higher life expectancy than New York and almost matched California; today, they're far behind.

What explains the divergence? Public policy certainly plays some role, especially in recent years, as blue states expanded Medicaid and drastically reduced the number of uninsured, while most red states didn't. The growing gap in educational levels has also surely played a role: Better-educated people tend to be healthier than the less educated.

Beyond that, there has been a striking divergence in behavior and lifestyle that must be affecting mortality. For example, the prevalence of obesity has soared all across America since 1990, but obesity rates are significantly higher in red states.

One thing that's clear, however, is that the facts are utterly inconsistent with the conservative diagnosis of what ails America.

Conservative figures like William Barr, the attorney general, look at rising mortality in America and attribute it to the collapse of traditional values — a collapse they attribute, in turn, to the evil machinations of "militant secularists." The secularist assault on traditional values, Barr claims, lies behind "soaring suicide rates," rising violence and "a deadly drug epidemic."


 -- via my feedly newsfeed

OECD highlights temporary labor migration: Almost as many guestworkers as permanent immigrants [feedly]

OECD highlights temporary labor migration: Almost as many guestworkers as permanent immigrants
https://www.epi.org/blog/oecd-highlights-temporary-labor-migration-almost-as-many-guestworkers-as-permanent-immigrants/

The 2019 edition of the Organization for Economic Cooperation and Development's (OECD) annual International Migration Outlook report included a new chapter, "Capturing the ephemeral: How much labour do temporary migrants contribute in OECD countries?" It's a good question, and one that had not yet been answered.

There is a dearth of data on temporary labor migration programs (TLMP) or schemes—aka guestworker programs, where migrants are employed temporarily in a country outside their own—and it hinders the ability of policymakers to make informed decisions. The OECD declared TLMPs are "a core concern in the public debate across OECD countries" but warns that their impacts are "understudied." This information deficit exists despite the fact that TLMPs are controversial and make up an increasing share of labor migration, and in the United States in particular have been at the center of debates about how to reform the U.S. immigration system.

Why are TLMPs controversial and at the center of public debates? First, their size. One of OECD's key findings is that the 4.9 million temporary labor migrants that entered OECD countries in 2017 is "almost as many… as permanent migrants in all categories combined." Ignoring temporary labor migration in the OECD means ignoring nearly half of all migration.

Many employers want larger TLMPs and fewer regulations governing their use. But there are high economic, social, and psychological costs for the migrant workers who participate in temporary programs, including frequent human rights violations suffered in both countries of origin and destination. Further, some abuses that are technically legal are facilitated by the legal frameworks of TLMPs. In most TLMPs, employers control the visa status of their temporary migrant employees or "guestworkers"—which means getting fired makes them deportable. In part, that's why TLMPs have been called things like "The New American Slavery."

TLMPs raise technical issues that are not easily resolved. For example: Which industries are permitted to hire migrant workers? How will appropriate numerical limits in TLMPs be determined? What rights will migrants have once they've been admitted into receiving country labor markets? Can they bring their families? Will migrants be tied to one employer or be allowed to change jobs and employers? How will receiving country governments ensure that migrants return after their employment contracts end, or will migrants be allowed to become permanent residents? Do citizens in receiving countries have first preference for jobs that employers want to fill with migrants? Will migrants be paid the same wages as similarly situated local workers?

Answers to these questions require honest discussions about the trade-offs that are inherent in migration policymaking, including whether labor migration is an appropriate response to employer claims of labor shortages. (Raising wages or increasing training may be a better response in many cases.) But these questions are particularly difficult—if not impossible—to answer satisfactorily without reliable data for evidence-based policy making.

The United States illustrates the problem of trying to make policy without reliable data. Comprehensive immigration reform bills adopted by the Senate in 2006 and 2013 were based on a "three-legged stool" of more enforcement, legalization for unauthorized immigrants, and more temporary labor migration. Thinking about the future impacts of temporary labor migration required analysis about existing TLMPs and predictions based on that analysis. But U.S. government-collected data on temporary work visas are inadequate, generally of poor quality, recorded in an inconsistent manner across federal agencies, and the most useful data are not published regularly or systematically. The result was a lack of reliable estimates and assumptions—instead, policymakers and the public had only claims made by advocates and employers to rely on.

The OECD "aims at closing" research gaps on labor migration "by providing the first estimates of the total employed temporary migrant population in full-year equivalent for 20 OECD countries." This is an especially useful finding, since the United States government has no official corresponding estimate of the number of temporary migrants employed in the labor market. The U.S. Department of Homeland Security (DHS) estimates what it refers to as the "resident nonimmigrant population"—temporary migrant workers are issued "nonimmigrant" visas that authorize employment—but it does not estimate how many nonimmigrants were employed in the U.S. labor market or calculate the number of full-time equivalent (FTE) jobs, nor does it provide numerical estimates by individual TLMP or visa classification.

OECD includes in their estimates "all categories of temporary migrants who may participate in the host country labour market" such as "international students, cultural exchange programme participants, service providers such as [European Union/ European Free Trade Association-]posted workers, as well as cross-border workers." There are hundreds of thousands of temporary labor migrants in the United States, and many more around the world, who are employed despite the fact that their visas are ostensibly for other purposes, like attending university or participating in a trainee or cultural exchange program. But while DHS's provides a population estimate for international students and cultural exchange visitors, it does not provide an estimate on how many of each group were employed.

Before the OECD's report, previous EPI research estimated that there were 1.4 million nonimmigrants employed in the United States during some portion of 2013, accounting for approximately 1% of the labor force. The OECD found 1.6 million FTE jobs filled by temporary labor migrants in the United States in 2017, accounting for 1.04% of the labor force.

OECD reported that 1.8 million temporary residence visas were issued in the United States in 2017, accounting for a third of all temporary residence visas issued across all 20 OECD countries. Next on the list were Australia, Japan, Canada, New Zealand, France, and South Korea. While most of the visas counted in this estimate permit employment, not all of them do, and across the OECD, one-quarter of the visas issued were renewals rather than newly issued visas. OECD also found that in the United States, less than half of temporary visas were issued to migrants in traditional TLMPs; over 20% went to accompanying family members, one-quarter to international students, and 6% to exchange visitors.

The OECD charted the distribution of the maximum allowed duration of stay of temporary visa holders, finding that 14.5% allowed a stay of over five years and 13.7% had no maximum duration, while just over one-fifth allowed a stay of 13–24 months and one-third allowed a stay of two to five years. Only 12.1% authorized a stay of less than 12 months.

These findings raise questions about what "temporary" means and whether the jobs migrant workers fill are truly temporary: If nearly nine in 10 temporary visas authorize a stay longer than one year, are migrants really filling temporary jobs? Can a job that lasts more than one year be considered temporary? Many of these jobs may be permanent jobs that have been misclassified as temporary—perhaps because employers prefer precarious workers over whom they can exert more control if they hold job-contingent temporary visas. Shouldn't governments instead consider issuing permanent immigrant visas that lead to citizenship for migrants who are filling de facto permanent jobs?

The OECD has spotlighted an important gap in migration research—one we have tried to call attention to in the past—that leads to important questions about the current trend in labor migration governance toward more temporary workers instead of permanent immigrants who have equal rights in destination countries. We hope that the OECD's new findings revealing the importance and size of temporary labor migration will spur improved data collection by governments and more research on TLMPs

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