Earl H. Kinmonth wrote:
Do calculations of GDP relative to workforce or employment allow for illegal, undocumented workers?
Presumably there are proportionally more of these in the US than in Japan.

RK:

Intriguing question. I put a call into the Bureau of Labor Statistics today, but have yet to hear back.
However, a cursory look at the literature shows that the BLS thinks there is very little distortion to productivity figures on this front. One reason is that, according to estimates by the Social Security Administration, 75% of illegal workers have bought counterfeit social security cards and have taxes deducted from their paycheck. That occurred as the laws increasingly forced employers to check for some kind of documentation. So both hour and output are on the books. In other cases, e.g. a family hiring an illegal alien as a nanny and paying cash, neither the hours nor the output are on the books.

Richard Katz
The Oriental Economist Report