Immigration's Effect on the Economy and You

The Pros and Cons of Immigration

In 2016, there were 43.7 million immigrants in the United States. That's 13.5 percent of the total population.

Immigrants live with 40.6 million American-born children who are U.S. citizens. Those 81 million immigrants and their families make up 25 percent of all U.S. residents. Almost 75 percent are documented immigrants and their children. 

Immigrants are less educated than the average American. But that's improving. For example, thirty percent of immigrants, 25 and older, lack a high school diploma compared to 10 percent of native-born adults. But that's better than in 1970 when more than half of immigrants lacked a high school diploma. 

Furthermore, 29 percent of immigrants have a college degree. But that's similar to the 30 percent of native-born counterparts. Forty-eight percent of immigrants who entered since 2010 have that degree. In 1970, only 12 percent of immigrants had a graduate degree. It increased to 16 percent by 2012. 

Undocumented Immigration

There were 11.3 million undocumented immigrants in 2016. That's 3.4 percent of the total population. It's down from the peak of 12.2 million in 2007. But their numbers have tripled from 3.5 million in 1990.

Eight million of them are in the workforce. That's down from 8.2 million in 2007. Almost half or 3.4 million pay Social Security payroll taxes. They and their employers contributed $13 billion as of 2010. They do so even though they are not eligible for Social Security benefits upon retirement.

Half are from Mexico. That's less than in 2009 because Mexico's economy is improving. At the same time, the number from Asia, Africa, and Central America has increased

Between 700,000 to 850,000 new immigrants arrive without documentation each year. More than half slipped across the U.S. border. The rest crossed the border with documentation but didn't return home when their visas expired.

In 2013, the Department of Homeland Security deported a record 434,015 immigrants. Of those, 45 percent had a criminal record. The Obama administration deported 2.4 million. It sent home more in its first five years than the Bush administration did in eight years. That's despite deportation relief for 580,946 young immigrants under Obama's Deferred Action for Childhood Arrivals.

The Department of Homeland Security reported in 2013 that there were 1.9 million "removable criminal aliens." That included all types of immigrants. President Donald Trump promised to deport them immediately.

In the 2016 presidential campaign, Trump also promised to build a wall on the border with Mexico. Trump's immigration policies are to reduce the number of undocumented immigrants in the country.

One reason there are so many undocumented immigrants is that it's so difficult to immigrate with authorization. There are 4 million people on immigration waiting lists. There are 165 million people who would leave their country if they could and would prefer moving to the United States.

Refugees

In 2015, there were 69,920 people who came as refugees. The government granted asylum to 26,124 of them. U.S. law requires the government to allow all refugees who show up at the border to apply for asylum. They are referred to an asylum officer who interviews to determine if they have a “credible fear” of persecution or torture in their home country.

If asylum is approved, refugees won't be returned to their home country. They can have authorization to work, apply for a Social Security card, and petition to bring family members to the United States. Asylees may also be eligible for Medicaid or Refugee Medical Assistance.

If the asylum officer doesn't find a credible fear, they order deportation. The refugee can appear before a judge to challenge the finding. In March 2018, there was a backlog of 690,000 deportation cases.

The Trump administration wants to eliminate the appeals process for asylum seekers. Instead, it wants to deport anyone who shows up at the border without documentation. It also briefly separated children from their parents to discourage other undocumented immigrants.

History of U.S. Immigration

In 1924, Congress established national-origin quotas with the Immigration Act of 1924. It awarded immigration visas to just 2 percent of the total number of people of each nationality in the United States as of the 1890 national census. It excluded all immigrants from Asia. People were anxious because of World War I and heartily supported limits on immigration. By 1970, immigration had fallen to a low of 4.7 percent of the population. That was down from a high of 14.7 percent in 1910. 

In 1965, Congress changed immigration policy with the Immigration and Nationality Act. It eliminated quotas based on nationality. Instead, it favored those with needed skills or who were joining families in the United States. That increased immigration from Asia and Latin America.

In 2014, America welcomed 1.3 million new immigrants. That's up from 1.2 million in 2013. India sent 147,500. China, which sent 131,800 people, and Mexico, at 130,000, were almost tied. So were Canada at 41,200 immigrants and the Philippines at 40,500 individuals. 

Today's percentage of immigrants is similar to the late 19th century when almost 15 percent of U.S. residents were immigrants. Most were from Italy, Germany, or Canada. They were tailors, stonemasons, and shopkeepers with skills needed by the United States. While only 17 percent of native-born Americans were skilled laborers, 27 percent of the immigrants were. 

Those who remained in America for 14 years were just as likely to own businesses as the native-born. Their children were just as likely to be accountants, engineers, or lawyers.

How Immigration Affects You

Immigrants have driven two-thirds of U.S. economic growth since 2011. They founded 30 percent U.S. firms, including 50 percent of startups valued at over $1 billion. 

Although they've helped the economy overall, the benefit is largely in certain industries. Immigrants with advanced degrees gravitate toward scientific and technical jobs that don't require high communication.

Newly arrived immigrants have one thing in common that reduces their ability to compete with native-born workers. They generally don't speak English as well. That means they are less likely to take jobs that require strong communication skills. For example, natives in management and media don't face a lot of competition from newly arrived immigrants. 

Immigration has a negative effect on workers without a college degree. That's especially true in agriculture and construction. In 2014, immigrants held 43 percent of agricultural jobs. Twenty percent were documented, according to the Pew Research Center. In building and grounds maintenance, 35 percent of the jobs were taken by immigrants. Nineteen percent were documented. In construction, 27 percent of the jobs went to immigrants, and 12 percent were documented.

In those industries, immigration lowers wages and drive out native-born workers in those areas. That pushes native-born workers into jobs like sales and personal services that require superior communication skills.

But what hurts some workers helps consumers. Immigrants lower the price of goods and services for everyone. That’s because they provide low-cost labor that allows companies to reduce the prices of consumer goods.

Immigrants in the work force pay taxes into Social Security and Medicare. It improves the age dependency ratio, or the number of working people who support the nation's senior population. The ratio is worsening because the U.S. born population is aging. There aren't as many in the working age population to support them. As more immigrants enter the workforce, the age dependency ratio improves.

Immigrant women are also more likely to have children. In 2014, immigrant women between the ages of 15 and 44 had 44 percent more kids than American born women of the same age. That helps support the current working population when they retire.

Contrary to other claims, immigrants are not more likely to commit crimes than the native-born population. They only make up 5 percent of the nation's prison inmates. But they comprise 7 percent of the total population. There are 1.9 million immigrants convicted of a crime. Less than half or 820,000 are in the country without documentation. Of those, 300,000 have felony convictions. 

Future of Immigration

Immigration dropped during the Great Recession and has not returned to pre-recession levels. Instead, immigration from Latin America may continue to weaken. Researchers from the University of California, San Diego, found there are two reasons. First, the economies of Latin American countries continued to improve. As a result, there isn't as much of an income gap between those countries and the United States.

Second, the baby boom continued through the 1970s. There weren't enough jobs to employ all those young workers entering the labor force in the 1990s. But the economies have had enough time to absorb these workers in the last 20 years. As a result, there isn't the same demographic push sending immigrants to the United States.