New arrivals are crucial to a well-rounded workforce and the long-term health of the American economy
New York, NY — Two recent columns from the Washington Post and the New York Times underscore immigrants’ important role in creating immediate and long-term economic growth for our communities and country.
The New York Times column by Nobel Prize-winning economist Paul Krugman underscores that “immigrants make America stronger and richer.” In the article, Krugman emphasizes Republicans’ refusal to act on the border because Trump “believes that chaos at the border will help his election prospects,” despite “the reality that immigration is one of America’s great sources of power and prosperity.”
Krugman notes that the lack of resources for government agencies makes it difficult to manage our immigration system and it is clear that “Republicans in Congress, while fulminating about a border crisis, appear determined to deny the needed funding.” The article notes that if U.S. law and policy would “cut off the flow of immigrants, who are largely working-age adults,… our system would become much less sustainable.”
In her Washington Post column, Catherine Rampell digs into the nonpartisan Congressional Budget Office’s 10-year forecast and the “multi trillion-dollar windfall for both the overall economy and federal tax coffers.”
The article highlights Federal Reserve Chair Jerome H. Powell’s comments that “the U.S. economy has benefited from immigration. And, frankly, just in the last year a big part of the story of the labor market coming back into better balance is immigration returning to levels that were more typical of the pre-pandemic era.”
Rampell contrasts Republicans’ current platform with how “Ronald Reagan, the erstwhile leader of the conservative movement, often spoke poignantly of [America historically drawing in hard-working immigrants from around the world]. In one of his last speeches as president, he described the riches that draw immigrants to our shores and how immigrants in turn redouble those riches…”
According to Douglas Rivlin, Senior Director of Communication for America’s Voice:
“If you just listen to the debate on the campaign trail or in Congress you would think immigration was a bullet to be dodged, not an essential ingredient in local and national economic growth. We are a nation creating more jobs than we have people to work at them. The fact that people want to come here to contribute to the economy and make a better life for themselves is what has made America so successful. Americans know the value immigrants bring to our nation, our culture and our economy. If we are able to overcome nativist opposition to legal immigration to have a controlled and orderly flow based on visas, immigration will be a critical component of our future growth and prosperity.”
America’s Voice recently hosted a webinar with the Immigration Research Initiative presenting their data, which shows that even new arrivals contribute to their local economies and that that contribution grows quickly and steadily over time. You can watch the webinar and look at the data and conclusions here.
Read on for highlights from both of the articles mentioned above:
New York Times: Immigrants Make America Stronger and Richer
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The bad news is that we’re having a hard time enforcing the rules on immigration, mainly because the relevant government agencies don’t have sufficient resources. And right now, the reason they don’t have those resources is that many Republicans in Congress, while fulminating about a border crisis, appear determined to deny the needed funding.
Their position is rooted in extraordinary political cynicism, and they aren’t even trying to hide it: Donald Trump has intervened with Republicans to block any immigration deal because he believes that chaos at the border will help his election prospects.
While blatant sabotage explains the current immigration impasse, however, there’s something else lurking behind it: Trump and those around him are profoundly hostile to immigration in general.
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So this seems like a good time to point out that negative views of the economics of immigration are all wrong. Far from taking jobs away, foreign-born workers have played a key role in America’s recent success at combining fast growth with a rapid decline in inflation. And foreign-born workers will also be crucial to the effort to deal with our country’s longer-term problems.
About that recent success: It has taken a while, but many observers are finally acknowledging that the United States has done extraordinarily well at recovering from the effects of the Covid-19 pandemic. Inflation has faded away in much of the world, but the United States stands out for its ability to combine disinflation with vigorous economic growth. And one key to that performance has been rapid growth in the U.S. labor force, which has risen by 2.9 million since the eve of the pandemic four years ago.
How much of that growth was due to foreign-born workers? All of it. The native-born labor force declined slightly over the past four years, reflecting an aging population, while we added three million foreign-born workers.
Did those foreign-born workers take jobs away from Americans — in particular, native-born Americans? No. America in early 2024 has full employment, with consumers who say that jobs are “plentiful” outnumbering those saying jobs are “hard to get” by almost five to one. The unemployment rate among native-born workers averaged just under 3.7 percent in 2023, as low as it’s been since the government began collecting the data.
In fact, I’d argue that the influx of foreign-born workers has helped the native born. There’s a large research literature on the economic impact of immigration, which consistently fails to find the often predicted negative effects on employment and wages. Instead, immigrant workers often turn out to be complementary to the native-born work force, bringing different skills that, in effect, help avoid supply bottlenecks and allow faster job creation. Silicon Valley, for instance, hires a lot of foreign-born engineers because they bring something additional to the table; the same is true for workers in many less-glamorous occupations.
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Foreign-born workers are crucial to America’s fiscal future. To a first approximation, the federal government is a system that collects taxes from working-age adults and spends much of the proceeds on programs that help seniors, such as Medicare and Social Security. Cut off the flow of immigrants, who are largely working-age adults, and our system would become much less sustainable.
So while the mess at the border needs to be fixed — and could be fixed if Republicans would help solve the problem instead of exploit it for political advantage — don’t let that mess obscure the larger reality that immigration is one of America’s great sources of power and prosperity.
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Washington Post: The surge in immigration is a $7 trillion gift to the economy
Consider a few numbers: Last week, the nonpartisan Congressional Budget Office released updated 10-year economic and budget forecasts. The numbers look significantly better than they did a year earlier, and immigration is a key reason.
The CBO has now factored in a previously unexpected surge in immigration that began in 2022, which the agency assumes will persist for several years. These immigrants are more likely to work than their native-born counterparts, largely because immigrants skew younger. This infusion of working-age immigrants will more than offset the expected retirement of the aging, native-born population.
This will in turn lead to better economic growth. As CBO Director Phill Swagel wrote in a note accompanying the forecasts: As a result of these immigration-driven revisions to the size of the labor force, “we estimate that, from 2023 to 2034, GDP will be greater by about $7 trillion and revenues will be greater by about $1 trillion than they would have been otherwise.”
Got that? The surprise increase in immigration has led a multitrillion-dollar windfall for both the overall economy and federal tax coffers.
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Over the long term, Federal Reserve Chair Jerome H. Powell recently said on CBS News’s “60 Minutes,” “The U.S. economy has benefited from immigration. And, frankly, just in the last year a big part of the story of the labor market coming back into better balance is immigration returning to levels that were more typical of the pre-pandemic era.”
A rise in the number of people ready and willing to work is not the only economic benefit. Immigrants are also associated with other positive growth effects, including higher entrepreneurship rates and disproportionate contributions to science, research and innovation.
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Instead GOP lawmakers scaremonger about the foreign-born, characterizing immigration as an invasion. As Rep. Mike Collins (R-Ga.) dog-whistled last week, “Import the 3rd world. Become the 3rd world.”
Alas, the faction working to turn the United States into a developing country is not immigrants but Collins’s own party. It’s Republicans, after all, who have supported the degradation of the rule of law; the return of a would-be dictator; the gutting of public education and health-care systems; the rollback of clean water standards and other environmental rules; and the relaxation of child labor laws (in lieu of letting immigrants fill open jobs, of course).
America has historically drawn hard-working immigrants from around the world precisely because its people and economy have more often been shielded from such “Third World”-like instability, which Republican politicians now invite in.
Ronald Reagan, the erstwhile leader of the conservative movement, often spoke poignantly of this phenomenon. In one of his last speeches as president, he described the riches that draw immigrants to our shores and how immigrants in turn redouble those riches:
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