Immigration and the Black Market

Readers Question - what on earth is the black market and how does the immigrant have an impact on that?

The Black Market refers to economic activity that is not regulated by the government. It involves economic activity where people don’t declare tax returns or pay VAT e.t.c. It sometimes may be referred to as the ‘underground economy’ or ‘black economy’. The black market may involve illegal activity such as drug dealing or it may involve typical jobs such as paying a builder in cash - this becomes black market activity. Note it is a legal requirement to declare income to the inland revenue. But, it can be hard to trace and track down.

Immigrants may find themselves working in the black market. These will be jobs that are paid in cash, ignore labour laws, ignore minimum wages and do not declare income for tax purposes. Illegal immigrants, especially, may find that they have no alternative but to work in the black market. This is because they are not legally able to work. The problem is that employers are in a position to exploit the illegal labour and frequently wages and conditions may be very poor and in some cases akin to slavery where the workers are tied to the boss who brought them into the country.

Even legal immigrants may find themselves working in the black market. First generation immigrants often find it relatively more difficult to get work because of discrimination, language problems, lack of skills. Therefore, they may end up working in the black market.

Black markets may be more likely when closed communities have demand for particular goods and services.