As hundreds of thousands of people took to the streets for the second time in a month to call for immigration reform, employers across the country got their first taste of worker absenteeism and lower sales ­ aftershocks of the divisive national debate that could intensify in coming months as the unresolved congressional debate over illegal immigration drags on.

Meatpacking, construction and retail -- especially in the South and Midwest -- were among industries affected by absenteeism as workers attended protests in more than 100 cities across the country. The demonstrations, and their effect on businesses, could foreshadow what may be a bigger national boycott planned for May 1.

Yet even as the mammoth street protests grow, there's no reason to think they will precipitate a quick end to the political impasse over illegal immigration. Both parties face months of political agony that will grow more painful as the November elections approach. The stalemate will linger because Congress recessed for two weeks Friday after an attempted compromise broke down. Some conservatives, irritated by the Hispanic outpouring, are suggesting that if the protests continue at the current intensity level, they may ultimately backfire on the immigration-reform movement.

National coalitions encompassing labor groups, immigrant-rights groups and faith-based organizations called several weeks ago for a "national day of action." The result was a hodgepodge of events, ranging from hunger strikes to work stoppages across the country. Several cities, like Los Angeles, organized events at the end of the workday. But in other parts of the country, events were held in the middle of the day, disrupting normal business operations.

In Arizona, more than 25,000 demonstrators rallied in Phoenix, while organizers in communities like Dodge City, Kan., asked participants to wear white in a march to the offices of Republican Sen. Pat Roberts, known for favoring stricter enforcement of immigration rules. In the first major protest on a college campus, several hundred students rallied at the University of California, Berkeley.

At a New York rally starting at 3 p.m., demonstrators filling the narrow confines of Broadway from City Hall north to the edge of SoHo heard speeches from Democratic Sens. Hillary Clinton and Charles Schumer -- both strongly condemning any attempts to force undocumented immigrants to leave the country -- and from a string of likeminded community and labor leaders. In the crowd were day laborers, hospital orderlies, care-givers to the elderly, pizza cooks, busboys, waiters, bartenders and the simply curious.

In many places, the events sent businesses racing to deal with the missing workers. Meatpacking plants in the Midwest and hotels and other businesses in the South were crippled by absenteeism among Hispanic workers. Major companies, like Tyson Foods Inc., sought to play down the impact of the rallies and stoppage on its operations. A spokesman said that "fewer than 10 of the more than 100 facilities" weren't operating due to the demonstrations and market conditions.

North Carolina, home to an emerging Latino population, was hard hit. A call by local immigrant groups for a retail boycott also prompted many Hispanics to stay away from work altogether. At the Omni Hotel in downtown Charlotte, a housekeeping coordinator reported that only two out of a 20-plus staff had shown up. "More than 90% of my workers are Latinas," she said. "They didn't show up."

Compare Foods Supermarkets, a supermarket chain that caters to Hispanics in North Carolina and beyond, saw a substantial slowdown in business. Cashier supervisor Mauricio Osorio said that there was "nobody compared with other Mondays." He predicted a 30% drop in sales. German De Castro, a Colombian native with U.S. citizenship who owns Tex-Fil Inc. in Charlotte, which processes filament yarns for the knitting and weaving industry, said: "I had about 20 employees. About 15 are Latinos. They all stayed out of work today. We talked about it and I support this 100%." He said they were being paid.

In a "campaign for immigrants' dignity" yesterday, marchers in Omaha, Neb., carried flags from the U.S., Mexico and other nations.

About one-third of U.S. restaurant workers are estimated to be Hispanic. Bryan Elliot, a restaurant analyst in Atlanta, said that in the long term, "if events create a reduction in newly arrived workers, that could significantly raise the cost of meals to ... consumers."

David Whitlock, an immigration lawyer in Atlanta, where yesterday's demonstration was expected to draw 30,000, said he was hearing from business clients "concerned" about the prospects of continuing absenteeism. "I'm advising some companies almost completely dependent on foreign workers," Mr. Whitlock said. "They're nervous. They could be crippled." His clients, he said, range from "a 10-person oriental-carpet shop to a 10,000-employee casino operator."

Health-care services were especially wary of losing staff without notice. "Our advice is there's not much you can do other than asking people not to leave en masse," Mr. Whitlock said. "We're telling them, apply your absentee policy. If you overreact, in our opinion, you are wide open for a discrimination charge."

This week's demonstrations represent the nightmare the Republicans who run Congress were hoping to avoid by coming up with a new and softer approach to immigration reform last week -- and is one of the reasons Democrats weren't eager to move that new approach along.

The issue deeply divides Republicans between those who see easy immigration as key to keeping the economy humming and those who see the country's porous borders as a threat to national security. Those two wings reached a wary compromise last week with a Senate bill that would have given legal residency to illegal immigrants who have been here for at least two years, but at the same time would have reinforced the border.

That compromise collapsed on Friday as Republican conservatives wanted to toughen up its provisions and Democrats refused to vote with Republican supporters of the deal to cut off debate on the measure. Congress then went into recess. The result: The face of immigration reform that the Republican Congress is presenting to the country remains a House bill, passed late last year, that would make illegal immigration a felony, make it a crime to help illegal aliens and build a long fence along the U.S.-Mexican border.

It is that measure that has brought Hispanics and other ethnic groups into the streets by the thousands. The question now is whether the giant protests enhance or diminish the prospects that Congress will embrace the softer compromise. It's possible that Republican leaders, fearing the demonstrations are hurting the party's image with Hispanic voters, will return more eager to soften their party's image on the immigration question.

But it's also possible the demonstrations will provoke a backlash among those who favor a tougher crackdown on immigration. Signs of that backlash already are sprouting. Irked by illegal immigrants' bold display of their foreign flags in last week's demonstrations, the Minuteman Civil Defense Corps, a civilian group that patrols the borders for illegal immigrants, called for "Take an American Flag to Work" days. It urged its supporters to "Carry [the flag] to lunch; wear red, white and blue; fly a flag from your car antenna."

--Stephanie Kang and Peter Sanders contributed to this article. Write to Miriam Jordan at miriam.jordan@wsj.com3, June Kronholz at june.kronholz@wsj.com4

Employers Have a Lot to Lose
By BARRY NEWMAN
April 11, 2006; Page B1

Balding and weathered, wearing a work shirt, Dave Penry stands in a park while men in windbreakers rake grass behind him in a television commercial that casts him as the unlikely -- and lonely -- front man for employers who rely on immigrant laborers.

"My partner and I own a landscaping company in California that employs 60 people, and two-thirds of them are immigrants," Mr. Penry tells the camera in a 30-second spot now running nationally. "They have as much pride in America as you or me. We need to fix our laws so they can work in this country legally and get the respect and dignity they've earned."

The camera closes in on Hispanic-looking men pruning trees. As music rises, a caption appears: "Building the American Dream."

A TV ad featuring landscaper Dave Penry backs laws friendly to immigrant workers. ,Immigrants are protesting from Los Angeles to New York, lawmakers are haggling ,over new bills and President Bush talks of bringing millions of workers out of the "shadows." The voice largely missing from the tense debate so far ,has been the bosses who hire illegal immigrants, leaving their lobbyists to speak for them.

"We don't press our members to come out and talk," says John Gay, who, co-chairs the Essential Worker Immigration Coalition. Its 45 members range from the Society of American Florists to the Outdoor Amusement Business Association.

"We make the case," he says, "rather than having individuals stick their necks out." Which is why Mr. Penry, an owner of Pacific Landscapes, Inc. in Sonoma County, Calif., is so rare.

"How would you like to have been the first guy to talk about erectile dysfunction?" Mr. Penry says. "That's a good analogy. Bob Dole had some guts."

Mr. Penry was speaking out for a bill that, in sterner form than he would prefer, got bottled up in the Senate last week. If it sees the light again after Congress returns from its Easter recess -- and then overcomes powerful opposition in the House -- at least a portion of the country's undocumented population of more than 11 million could gain legal status and eventual citizenship.

But any new regime would also jack up workplace enforcement and impose severe punishment -- including jail time -- on employers who give jobs to people who don't have the proper documents. It is a sign of the issue's history of dangers and delicacies for business that, when asked the direct question -- Do you, in fact, employ illegal immigrants? -- even Mr. Penry stops short. He says, "I don't know."

Unauthorized immigrants may live in the shadows, but they don't all work in them. The Migration Policy Institute, an independent think tank in Washington, reports that at least half the seven million thought to be illegally employed have aboveground bosses who check credentials and fill out forms, deduct taxes and pay Social Security.

Of the hotel industry's 1.5 million employees, 150,000 aren't supposed to be here, according to statistics gathered by the Pew Hispanic Center. In food manufacturing, also with 1.5 million, 210,000 have no right to work. Landscaping, Mr. Penry's line, has 1.2 million workers, 300,000 of them illegally in the country.

"Most of the undocumented workers in America are working for good, reputable, law-abiding employers," he says.

In 1986, Congress compromised on an immigration bill that gave legal residence to three million foreign workers while giving the federal government greater powers to police work sites. Since then, employers have been asked to inspect an assortment of documents from job applicants as proof of work authorization, but, apart from blatant forgeries, they aren't expected to be judges of authenticity.

Even in such businesses as roofing, where one in three workers is thought to be undocumented, "don't know" is the standard answer employers give when asked if any illegals are on their payrolls.

"I wouldn't be telling the truth if I tried to say that I'm 100% sure that everybody we have is documented," says Rick Birkman, a commercial-roofing contractor in Austin, Texas. "Is there plausible deniability in what we do? Sure, there is."

Employers say it is possible to ask too many questions, leading job seekers with the proper documents to feel as if they are being unfairly targeted because of their ethnicity. They say the rules were written that way to mollify civil-rights groups.

But others say the law gave bosses an intentional out. Adopted during the antiregulation Reagan years, it was nevertheless the biggest leap in work-site monitoring since the Occupational Health and Safety Administration was created 15 years earlier.

The rules were further eased in recent years. Inspectors now need written permission from supervisors before entering a work site. Employers get credit for "good faith attempts" to live up to the law. Since 1996, when the focus of enforcement began to move away from work sites to the borders, the number of fines collected have dropped to nearly zero from a high of about 8,000.

What crystallized the business lobby's support for immigration reform today wasn't fear of enforcement; it was fear of losing workers. Its argument is for a new system that maintains the work force and also allows an employee's status to be authenticated instantly, with something like a swipe card at a grocery store.

The outpouring of illegal workers that continued yesterday didn't bring many bosses onto the streets. But Dave Penry is thinking about it.

Ten years ago, when the landscaper had 250 employees, a raid cost him more than 50 of them. "A couple of those men named their kids after me," he says. Now, he feels the atmosphere of protest "is strangely familiar to the 60s and '70s, when it was all about Vietnam."

"Sure employers are running scared," says Mr. Penry. "But a lot of Hispanics have helped my company become successful. It was time for an employer to stand up." That is why he went on television. And why, on May 5 -- the Cinco de Mayo holiday -- he has given his workers a day off for a protest "to show America how important they are."

"I'm willing to go march with these guys," he says. "These men are my family. We owe them something. We owe them the good fight."

Write to Barry Newman at barry.newman@wsj.com1