Perspectives On Immigration: Immigrants And The U.S. Economy

Critics of immigration argue that there is a huge cost to the American taxpayer, that immigrants come to take advantage of government “handouts” and compete with American workers for jobs. The facts do not support those arguments.  Quite the opposite.  The Center for American Progress (CAP) found that immigrants added about $2 trillion to the U.S. Gross Domestic Product (GDP) in 2016, with more than 40 percent of Fortune 500 companies founded by immigrants and their children.  Immigrants, they argue, complement rather than compete with American workers, and will be crucial to filling job openings as Baby Boomers retire.

The Center for American Progress is admittedly liberal, and, yes, George Soros is among its many funders – along with WalMart, Wells Fargo, Citigroup, Eli Lilly Co., the United Arab Emirates and other decidedly non-liberal financiers. But although the language is a bit different, the conservative Committee for Economic Development of The Conference Board (CED), applying a cost/benefit analysis, agrees:

“Each immigrant of working age who arrives in the US represents an immediate infusion of human capital into the economy. As with any form of investment, human capital once formed delivers a stream of future income, adding to GDP. New immigrants carry with them human capital formed from education, training, and child rearing they received in their home country. Once they arrive in the US, they add to the productive capacity of the economy, the value of which can be assessed by the present value of their future earnings. As a result, the return on the investment in immigration is quite high, as the US economy benefits from the early investment in immigrants’ human capital, made in their home country. As the population of new immigrants shifts toward a more educated one, these human capital endowments become larger.”

CED estimates the human capital contribution of new immigrants at about $314 billion a year, with immigrants more likely to be better educated over time.  In fact, in 2015, nearly half of immigrant arrivals had bachelor’s degrees or better, with the number of lower-skilled (and often undocumented) workers declining.  A benefit CED includes in its calculations is that the cost of child-rearing and education have already been met in their home countries and will not be borne by U.S. taxpayers.

CAP researchers found that the poverty rate for immigrants in 2015 was 17.3 percent; for U.S.-born, 14.3 percent.  Even so, immigrant working class households received 9.3 percent of their overall income from public programs such as food stamps, Social Security or welfare, while U.S.-born-headed households received 15 percent of their income from such programs.  They also found that more than half of the foreign-born are homeowners, and that immigrants are becoming homeowners at a faster rate than the U.S.-born population, contributing some $3.7 trillion to housing markets.

Unauthorized immigrants – the current politically correct term – are increasingly entering the U.S. legally and overstaying their visas.  The U.S. Department of Homeland Security (DHS) found the largest sources of visa violators are from Canada, Mexico, and Brazil.  Mexicans make up half of the unauthorized immigrant population, but Mexican legal residents grew faster than their illegal counterparts.  The majority of unauthorized immigrants are long-term U.S. residents, with about two-thirds living in the U.S. for over ten years.

As of 2014, 21 percent of the unauthorized population lived in California, 15 percent in Texas, 8 percent in Florida, 7 percent in New York, 5 percent in New Jersey, and 4 percent in Illinois.  Current immigration law prevents many from applying for legal status.  Some 3 million could qualify for a Green Card because they have a close relative who is a U.S. citizen, but they would have to leave the country and face up to ten years waiting because of re-entry bars put in place in 1996, when Democrat Bill Clinton was president and Congress had a Republican majority.

There are many misleading “statistics” floating around.  For instance, the British Daily Mail, in a March 14, 2019 story about the largest groups of naturalized immigrants in each state, had a sub-head: Indian Settlers Came Top in Nine States….” and later, Somalians were the largest group of settlers in three states….  Both statements are factual, but, and it’s a big BUT, the immigrants from India totaled less than 8,000 in those nine states, and Somalians added up to under 2400 in the three states cited.  When you compare that with over 40,000 Mexicans in California, over 20,000 Mexicans in Texas, over 20,000 Dominicans in New York, and almost 6,000 Mexicans in Arizona, well….Montana, with its largest group of naturalized immigrants being Mexicans, all 33 of them, might not perceive why there is any controversy.

Note that in New York, there are some one million Puerto Ricans that dwarf the Dominican migration.  They are not included in the statistics because the island is a U.S. territory (colony), and its people U.S. citizens, albeit often treated as second-class when it comes to hurricane relief, etc.  Island residents cannot vote for U.S. president, but those that move to the mainland can.  Islanders pay Social Security and Medicare taxes, but not federal income tax.  They have no representation in Congress.

The non-partisan Economic Policy Institute (EPI), which is supported in large part by labor unions who might be expected to minimize any positive impacts by immigrants on the labor force , found in 2014 that “there is broad agreement among academic economists that in the long run, immigration has a small but positive impact on the labor market outcomes of native-born workers, on average.  There is some debate about whether, within the overall small positive effect, certain subgroups are harmed, in particular native-born workers with low levels of education.  The evidence shows that in the long run, immigrants do not reduce native employment rates. But some evidence suggests that in the short run, immigration may slightly reduce native employment, because the economy takes time to adjust to new immigration.”

Government policy may have more impact on American jobs than unauthorized workers: “Congress has set a yearly limit on the number of new permanent and temporary immigrants who may enter the country legally in order to work, and these limits do not fluctuate based on the state of the labor market. For example, in 2010, the unemployment rate in construction was over 20 percent, but the Department of Labor nevertheless certified thousands of temporary foreign worker visas for the construction industry.”

There is little evidence that immigrant labor depresses the wages of U.S. workers, but new immigrants do put  pressure on earlier immigrants.  The bigger problems are programs like the Guest Worker which tie an immigrant employee to one employer, with limited rights and no bargaining power.  If treated badly, their only recourse is to leave the country, probably in debt from the costs of getting here.  “Prevailing wage” rules allow those employers to pay less than the market rate, and that does depress wages.

Unauthorized workers who complain about conditions or pay face threats of arrest and deportation, and so it is greedy employers who force wages downward, and not the immigrant workers.  And according to the Social Security Administration, three-quarters of those unauthorized immigrant workers are on formal payrolls, using someone else’s (or a made-up) Social Security number – with FICA and Medicare taxes to the tune of $7 – 13 billion a year withheld that they will never collect on.

Similarly, income taxes withheld from paychecks are often never claimed for fear of deportation if they file.  CAP estimates that unauthorized immigrants contribute about $7 billion in sales and excise taxes annually, plus $3.6 billion in property taxes and over $1 billion in personal income taxes.  Legal status would raise that another $2.2 billion.

Mass deportations, on the other hand, would cost the federal government billions of dollars, over $10,000 per person, and states with large unauthorized immigrant populations would take a significant hit to their economies, $103 billion in California, $60 billion in Texas, $40 billion in New York, and $26 billion in New Jersey.

The bottom line, as conservative John Daniel Davidson wrote in the March 14, 2019 issue of The Federalist, is that  “…low-skilled workers are coming to America in large numbers because American employers want to hire them.  (Emphasis in the original.)

“That was true in the 19thcentury, when large numbers of Chinese immigrants were employed as railroad laborers, and it’s true today, as even larger numbers of illegal immigrants from Mexico and Central America find employment in farming, construction, and manufacturing.  In other words, market forces are at play. U.S. employers have a demand for cheap labor and plenty of foreign-born laborers are willing to meet it.”

(Part 3 will examine the roots of the present migrations, especially from Central America and Mexico.  Part 4 will consider the ”War on Drugs” and the role of immigrants.)

16 Comments

  1. Assimilation Albert, the legal immigrants of years past assimilated into our American culture. Now it’s dial 9 for English.

    • Not always true, BS, and not always legal. My mother’s parents came from Finland and never learned more than a few words in English, staying close to the large Finnish community in Baltimore. Grandpa Isaac Bjorklund had come to the US to work, was radicalized by the employers while copper mining around Butte, Montana, and joined the IWW, the Wobblies, who were an anti-capitalist union always under attack by employers and government. He joined a strike where a mine was dynamited — no casualties — and hurriedly went back to Finland. He returned to the US a few years later with a wife, and a new name, Lund, “legally.” Or was it? Things are not so cut and dried when you take a closer look.

      On my father’s side his father moved towards assimilation as fast as he could,but his wife stayed close to home raising 11 children and learning very little English. She never assimilated before she died of cancer.

      • the key factor is they came here legally. Liberal media keeps painting these mobs of people as migrants or immigrants….. well once they cross the border without authorization they become illegal aliens and as such need to be treated as criminals one and all. We need laws to allow BP and ICE to capture, take all related information from them and then march them back over the border where they crossed from. They also need to lose their right to file for asylum or visas for at least 5 years. If they are caught crossing illegally a second time they lose their visa or asylum for life and that includes the litters they are dragging with them. Swift deportation with no detention, no feeding, no medical care, and no releasing into our communities.

  2. Way to destroy you own premise in the first sentence.
    1. If an Illegal Alien did not come here to ‘take advantage of government “handouts” ‘, then they will have to ‘compete with American workers for jobs’.
    2. If an Illegal Alien did not come here to ‘compete with American workers for jobs’, then they will have to ‘take advantage of government “handouts” ‘.

    Unless, Albert, you believe that they cross the border and just mill about doing nothing.

    You then include useless ramblings from liberal groups. But, you say we should trust them because you said so.

    The rest of the article is just filled with meaningless or out of context statistics.

    The real reason that companies like to hire Illegal Aliens, because they know that Illegal Aliens will not report any laws broken by their employer. You know, laws like OSHA Laws, Employment Laws, Overtime Laws.

    And the big one… Sexual Harassment Laws.

  3. Albert;
    “New immigrants carry with them human capital formed from education, training, and child rearing they received in their home country.”
    Q; What about their kids? They need food,( food stamps) medical care,(Medicaid), Education, )bigger classes and that’s all paid by the tax payer,) Until the working adults can pay for it.

    “As with any form of investment, human capital once formed delivers a stream of future income, adding to GDP.”
    Q; Once formed, what? Do you guarantee all will be employed right away? While they are waiting who will support them? (They all speak English?) the Govt. out of our taxes? Once hired whose job will they take? A young college student trying to support him/her self working part time? High school students married to young, with a baby on the way? Seniors who need to supplement their income because their s**itty social security doesn’t pay enough? Most seniors HAVE to supplement their income due to medical conditions Medicare doesn’t cover, like only 80%, Know what 20% we must cover can be? Think anyone can just cough up 2 -10+ grand? While illegal immigrants
    (the real term, live in reality Albert!) get free care?
    We are not all the “Elites” Albert, we are not pelousey or schemer or even you, who think nothing of going to the doctor or getting a needed surgery. We far outnumber the “Haves”. We built this country, the factory workers, waitresses, cooks farmers and construction workers of America among many other “trades”. We all did not get rich getting into politics like all of the swamped D.C. The majority live day to day and most don’t complain, we find our joy in watching our children grow up, love our families take pride in our work. What? just to have immigrants taking over?
    ADI may not print this, as I am definitely not politically correct in my speech or thinking but what the he(( some one needs to keep speaking up just like those comments above.

    “The rest of the article is just filled with meaningless or out of context statistics.” Correct Evil One!

  4. Well as usual albert does not understand the term immigrant vs illegal migrant!
    Immigrants:
    An immigrant is a person who moves to another country, usually for permanent residence. The key to remembering what this word means is its prefix, im-. Im- comes from the Latin word for in, which reflects the fact that an immigrant is one who comes into a new country.
    Migrant
    The word migrant is the root of both immigrant and emigrant, and it, too comes from Latin. The Latin word migrare means to move from place to place. It’s resulted words like migrant and migrate. Migrant is the word to choose when you’re referring to people who are settling in a new place but don’t want to call attention to where they came from or where they’re going.

    alien
    Often Disparaging and Offensive . a resident of one country who was born in or owes allegiance to another country and has not acquired citizenship by naturalization in the country of residence (distinguished from citizen). See also resident alien, illegal alien.
    residing under a government or in a country other than that of one’s birth without having or obtaining the status of citizenship there.

    So yes IMMIGRANTS do add by applying and entering LEGALLY and they do add to the country health. Most are EDUCATED, SPEAK English, Are READY to ASSIMILATE into society. The illegals bring nothing of real value and DO ADD to the social costs by being here. In addition they want to bring the standards of this country down to the one they just left, much like democraps who complain they dont fit in in an area and always refer to the place they ESCAPED from by starting out with, ‘where I came from we……….’

    SO albert you have mixed apples and oranges and came up with plum pudding in trying to justify the destruction of this country. Nice try

    • The correct non-pc term is ILLEGAL ALIEN. In the 50’s and 60’s there were tv commercials annually that ALIENS needed to register their presence.

    • Poor Albert has an impossible task, justifying illegal immigration into our country when legal immigration is a relatively simple process to comply with. Also, Albert either does not understand or refuses to accept that it is the responsibility of Congress and the President to change the means by which migrants come to the United States. It is NOT the “right” of those wishing to come her illegally or those wanting to justify illegal immigration to change our laws.

  5. Jeez, fellas, I didn’t make this stuff up, but went to a mix of liberal and conservative sources. I realize that some people get confused by the facts, but maybe others will start thinking for themselves. Some of what turned up surprised me — but that’s the fun of research — such as: Unauthorized immigrants – the current politically correct term – are increasingly entering the U.S. legally and overstaying their visas. The U.S. Department of Homeland Security (DHS) found the largest sources of visa violators are from Canada, Mexico, and Brazil.

    And: The bottom line, as conservative John Daniel Davidson wrote in the March 14, 2019 issue of The Federalist, is that “…low-skilled workers are coming to America in large numbers because American employers want to hire them.

    • Other than trying to use words to convine people, just look locally. Tucson CANNOT get any supposed business to move here due to the fact that the education level is so low that they cant even basically train them. Thats why MANUAL LABOR jobs are the only thing these illegals can find (landscape, digging ditches etc). These are ‘facts’ from the local news sources to include adi, yet you still spout the bs that business wants them. They may in some instances work in building trades but its because they first get in get educated on how to do the job and then demand higher wages, thus the cycle starts all over again. Or some may and go an pick in the fields, you know your favorite chant of jobs americans wont do. They then after a bit do the same thing want higher wages and better conditions so they end up NOT doing the jobs americans wont do. Make welfare conditions subject to work standads. They must work to get if able. As a kid I worked with a guy for $1.50/hr, thought I was rich ($50/week). Saved $40 for school. Anyhow the welfare guy working with us said it was bs as he drew more on welfare than working. Left the job never came back. NY state at the time had multiple generations on welfare as that is how they got their $$. Well use the same thing if able work, or lose the $$ income. Pretty simple concept, then everyone will work maybe?

    • “low-skilled workers are coming to America in large numbers because American employers want to hire them.”
      So that makes it all right? Because employers want to hire them? Gee I wonder why… to exploit them, you know how.
      Well Illegals are less likely to complain about their low wages because that would expose them as Illegal! American citizens will raise he(( about any kind of abuse,(except the #metoo crowd, they wait 15 to 20 yrs.) The illegal who has been exploited and intimidated from birth by their govt. brings the same kind of mind set, that of peons.
      You went to conservative web sites? really? because I go to many such sites and they would contradict your “facts”. Seriously. I am conservative and have never come across your “Facts” Remember that some churches assume the Conservative label due to being Churches, but they also harbor Illegal aliens, that’s a liberal to me,and don’t even go to quoting Bible scripture. Regardless of Jesus being Love, He also was against Law breaking and invasion, aggressive or passive of one country against another. When you have 10,000 marching toward us, they should turn around and march on their own govt. They just don’t want to die trying, they are cowards. If our forefathers thought the same way we would all be speaking with an British accent today, well we dodged that bullet!

  6. @Albert: Tough crowd. Oh well there’s always next week.
    Maybe your buddy Soros can loan you the three sock puppets (Michelle, Tin and Rick) to help prop up, promote and force feed your insightful views to an audience that just isn’t buying it.
    I respect your passion Albert.

    The Oracle

  7. So typical. BIG difference between legal immigration and Illegal immigration yet you always want to make Americans sound like we are anti-immigration. Until you quit lying and realize the difference no progress will be made. Remember the key work is LEGAL. We are a country built on laws.

  8. Jobs If they paid decent and had houseing that was affordable in the same area Many more Americans would fill them
    Some Illegals will work at this job live in hole infested with roachs etc And Also take welfare benifits plus have 10 more kids on our dime Those ten kids one and half might make something out of his or her lifethe rest will join gangs deal drugs and have 10 more kids on the system
    So dont sell me not enough workers in America we have seen this before
    And in 1920s most all came here LEGALLY Like my parents they waited in line Took a oath to learn English respect American laws etc
    Somehow all of that is lost
    I do not like illegals telling me they dont like My Ametican Flagg
    I do not like illegals telling me to take down Jeaus from the manger at Christmas
    I do not like Illegals telling me
    I am racist when in fact my skin is Olive
    I do not like they Demand Rights when they have not Earned them
    I do not like illegals taking away from other Americans having a hard time
    I do not like them telling me they want to be treated eqaul when they havent obeyed our laws
    I will not respect them Until they respect Us !
    They have to swear an oath to learn English Refrain from any ILLEGAL activites and Obey our Laws. And work and teach their children What real freedom is
    And get in line learn how to wait and take responsablity for all their actions
    Americans come First
    And until you can
    Stand Up And say I plegde allegiance to the American Flag and what it Stands for,
    Your God is your choice But how dare you Not respect mine as I do your own Remember You want rights and a Democratic Gov
    Respect ours You have no right to demand we take care of you and yours Your a Illegal guest Until
    You do it the Legal way

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