I have a bit of a different take on your question. My husband works overseas, and the reason he can do this is the substandard quality of work, training, work ethic, problem solving etc. In your example, the most likely thing to happen is this. Due to poor workmanship, poor upkeep of equipment, lack of reporting problems with equipment, none productive time due to lack of education, the employer goes out of business. Now everyone has lost out.
I think you have some really valid arguments. I personally am not necessarily against illegal immigrants. Often they are doing jobs I wouldn't want to do. It is important to remember that generally you get what you pay for. The person working for $5/hr often is not capable of doing anything worth more than that.
Lived overseas for years, know how this can happen so easily.