How Does Immigration Really Affect the U.S. Economy?

As of 2013, nearly 41 million immigrants live in the U.S., about 13 percent of the total population. Nearly 11 million of those individuals are undocumented. Through these immigrants, the U.S. is still a melting pot of ethnic and cultural diversity, while immigration itself remains a heated issue.

Debates on immigration often entail discussing the impact immigrants have on the U.S. economy. Increasingly, research finds that the economic impacts are positive.

Nearly 26 million foreign-born workers are in the U.S. labor force, including both lawful permanent residents (LPRs) and undocumented or unauthorized immigrants. Within the same workplace, it’s common for foreign-born workers to work side by side with native-born workers. These two groups tend to complement each other, rather than taking away jobs for native-born workers.

In 2013, Americas Society/Council of the Americas and the Fiscal Policy Institute reported that foreign-born workers made up 18 percent of overall U.S. business ownership, with 28 percent of Main Street business — such as grocery stores, restaurants and clothing stores — owned by foreign-born workers. These small businesses create jobs while serving their communities.

Many of the jobs employing foreign-born workers fall in the STEM (science, technology, engineering and math) fields, where talent supply has not kept up with demand. With the unemployment rate in these fields so low, and the demand for STEM workers so high, employing foreign-born workers has little effect on the unemployment rate of native-born workers.

 Research finds that leveraging foreign-born workers in STEM fields tends to create jobs. A 2012 report from the Information Technology Industry Council, the Partnership for a New American Economy and the U.S. Chamber of Commerce found that, “[E]very foreign-born student who graduates from a U.S. university with an advanced degree and stays to work in STEM has been shown to create on average 2.62 jobs for American workers — often because they help lead in innovation, research and development.”

In fact, 18 percent of all Fortune 500 companies were founded by immigrants. These companies, such as Verizon, Procter & Gamble, eBay, Google and Comcast, have generated nearly $2 trillion in annual revenue as of 2010, with 3.6 million workers worldwide.

Overall, foreign-born workers contribute positively to the U.S. economy, greatly outweighing the negatives cited by anti-immigration activists. Highly-educated immigrants create more jobs, often though their own companies, fueling economic growth that is sometimes overlooked during the heated immigration debate. With the push for comprehensive immigration reform growing stronger, the economic benefits speak volumes. As the nation moves forward from the Great Recession, let’s not lose sight of positive impacts on the economy — immigration included.

Category: Immigration Policy Center, Immigration reform Comment »


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