How Immigration Reform Could Help Fix Our Economy

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Mexican immigrant Roberto Garcia, center, and son Alan, left, look at wrist watches while shopping in Los Angeles, Monday, Jan. 28, 2013. Seeking swift action on immigration, President Barack Obama on Tuesday will try to rally public support behind his proposals for giving millions of illegal immigrants a pathway to citizenship, as well as making improvements to the legal immigration system and border security. (AP Photo/Jae C. Hong)
Mexican immigrant Roberto Garcia, center, and son Alan, left, look at wrist watches while shopping in Los Angeles, Monday, Jan. 28, 2013. (AP Photo/Jae C. Hong)

If you’re worried about the economy, you should also be worried about the fate of immigration reform. According to this 2010 analysis by The Brookings Institution’s Hamilton Project, the idea that immigrants are a drag on the economy — a belief shared by many Americans – is simply incorrect.

Immigrants coming to America are split between those who are highly educated and those who arrive without a high school diploma. On one end of the spectrum, immigrants are nearly twice as likely as U.S.-born citizens to have a PhD; at the other end, immigrants are four times more likely than U.S. citizens to have not graduated from high school.

Immigrant Education

Brookings Institution's Hamilton Project


There’s a widely-held belief that the group on the right side of this chart — the 11 percent of foreign-born workers with advanced degrees — are the important group of immigrants the U.S. needs to attract: The Immigration Innovation Act of 2013, introduced this week by a bipartisan group of senators, focuses only on immigration reform for skilled immigrants.

But regardless of education level, immigrants have a positive effect on the American economy. Research shows that immigrants increase the standard for all U.S.-born workers by increasing wages and lowering prices. The wage increase for unskilled American workers may seem counter-intuitive, but immigrants often do not seek jobs already held by U.S.-born workers; they instead go into fields that help U.S. workers. Brookings Institution Senior Fellows Michael Greenstone and Adam Looney give one scenario illustrating how this works:

…many immigrants complement the work of U.S. employees and increase their productivity. For example, low-skill immigrant laborers allow U.S.-born farmers, contractors, or craftsmen to expand agricultural production or to build more homes — thereby expanding employment possibilities and incomes for U.S. workers.

Immigrants also aren’t a drain on the government budget. The taxes paid by immigrants and their children — including the children of undocumented immigrants — cover the costs of the services they use. Many of the government-funded services provided to immigrants are related to raising children — but as the chart below shows, over a lifetime, immigrant children pay back the cost of the services they use, and are no more expensive to taxpayers than the children of U.S.-born parents.

Immigrant Taxpayer Cost

Brookings Institution's Hamilton Project

Additionally, immigrants spur the economy by starting more businesses and contributing more to U.S. innovation than native-born workers. New businesses and research end up helping all Americans by creating new jobs and opening new doors to more innovation.

Immigrant Business & Patents

Brookings Institutione's Hamilton Project

By reforming immigration policy through legislation recently proposed by the president and a bipartisan group of senators, the U.S. also could counter its slowing birth rate, putting America in a stronger demographic position than Europe, Japan and China. This could be particularly beneficial in many of America’s post-industrial cities, where the average age of the population is drifting upward as younger workers leave in search of jobs. William H. Fey, a demographer and senior fellow with the Brookings Institution’s Metropolitan Policy Program, told the National Journal:

Currently, about 13 percent of the population is age 65 or older. Over the next 20 years, we’re going to have 14 million whites, primarily native-born whites, leaving the labor force. Almost all the gains will be among Hispanics and other minority groups, and descendants of immigrants. For the nation’s economy and workforce to be strong, we must address how people will fill some of those jobs. The dynamic productivity of our country is going to be a result of past, current, and future immigration, of people in their productive years. Otherwise we’re going to be extremely top-heavy.

In short, immigrants of all sorts — from different countries, of various education levels — could be extremely helpful in urging our country toward financial recovery and sustaining our economy into the future. As Congress gains momentum on immigration reform — as it has this week — politicians should remember that rethinking our current policies may not only benefit foreign-born immigrants within our borders looking for citizenship, or the world’s best and brightest beyond our borders who hope to study and do research here. As the economy continues to slog slowly forward, reform also could turn out to be a favor to U.S.-born workers and businesspeople.

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  • Ann

    I’m pretty sure it’s the illegal immigrants that most of us are concerned with… Those coming to the U.S. with college degrees are far more likely to become citizens, acquire paying jobs which contribute taxes, and to educate their own children to also be taxpaying, contributing members of society. The illegal immigrants, who will not be working at legal, taxpaying jobs, who visit our hospitals and drive up our healthcare costs, and are a drain on our public assistance systems, are the immigrants most U.S. citizens are concerned with.

  • Lisa

    We need to address what NAFTA and the other global free trade measures do to the workers of the world. We must address the Global effects of our foreign trade policies and how they effect our jobs and the world’s workers. It’s more complicated the “who is” immigrating. We must address the ‘WHY of” the influx, the majority of which is the Mexican and Central American mobile worker labor force that has come to this country in huge numbers since NAFTA was implemented. and we need to look at the effects of free trade globally, we feel the effects of outsourcing and low wages and deregulation of unions but how do we change the way the powers that be regulate us through foreign policy. Can we out maneuver multi national corporations that determine our very existence?

  • JulesK

    I want the borders shut down for the foreseeable future. A huge population *is* a drag, and the huge labor surplus (which is now even affecting “white collar” jobs) does hurt us. It hurts us when the jobs are outsourced, and it hurts us when we import the labor. It’s so odd to me that immigration is so sacred to some people. I don’t hate immigrants, but large numbers of people continuing to flow in just isn’t a good thing, and I’m sort of exhausted by otherwise smart people who really seem to *get* that the upper class loves, and has actively perpetuated the state of poverty and desperation most people are in, don’t seem to get that part of the overall plan to create a poor and desperate work force is continued mass immigration.

  • http://bit.ly/d2n5i7 Forums4Justice

    Help turn the tide by educating all Americans about the negatives of illegal immigration http://forumsforjustice.com/forums/showpost.php?p=3967&postcount=1 ….

  • Anonymous

    the Immigration Innovation Act will not fix our economic problems. Punishing tax paying citizens and giving their jobs to replacement scab H1b workers, is not going to lower unemployment – ????!!! – isn’t it obvious. The H1b program is full of fraud and corruption, and needs to be killed now. American jobs are for American workers first, and not up for companies to give away to wage-depressing guest-workers. Let you rep’s know that this needs to be put down immediatly, stop the Immigration Innovation Act .

  • Karen

    Agreed & we do not need a new immigration reform law. We need to enforce the immigration laws already on the books. Basically, our congressmen, senators & the president are trying to do comprehensive immigration reform so they appear to be accomplishing something. However, they don”t want reform: the republicans don’t want reform because their business constituent voters want cheap labor & the democrats don’t want reform because they want cheap votes. The 1986 immigration reform laws already has an employer enforcement law to fine employers for employing illegal aliens. However, the employers complained & the republican politicians pressured the INS not to enforce the employer enforcement law.

    The h1b program is a joke. Employers claim they can’t find Americans willing to work in those h1b jobs. What these employers don’t say is americans won’t take those jobs AT THE SALARIES the employers are willing to pay.

  • JulesK

    It gives me a bit of hope that more and more people really don’t seem to be buying the “immigration is always good, and if you disagree it *must* be because you’re a dirty racist” argument anymore. For awhile there (when it was mostly “just” the poor who felt a real sting from it) it was a pretty damned effective way to shut down any argument against continued mass immigration. It was so frustrating. I watched my beautiful home state (California) get nearly paved over/covered in subdivisions, and became a place for only the very rich, or the poor who serve the rich. Post collapse, it is of course, even more an economy of stark contrast (almost third world).

  • Anonymous

    Mr. Moyer, I have long admired your work, but I strongly disagree of your approval of the so-called Immigration Innovation Act of 2013. I urge you to read this excellent analysis, written by Robert Cringely, a highly respected technology analyst and pundit.

    http://betanews.com/2012/10/25/h-1b-visa-abuse-limits-wages-and-steals-us-jobs/

    Mr. Cringely’s piece is backed up by several studies – showing that H1-B Visas are used almost solely to replace capable American tech workers. I have seen this up close, and personal, in Silicon Valley, where *tens-of-thousands* of tech workers over 35 have-been-and-are are regularly replaced by lower-skilled immigrants from India and China (India, especially).

    H1-B visa abuse is used to replace able American workers. I have seen completely incompetent H1-B workers take over entire divisions of major software companies – divisions of 300-400 people, populated by Asian Indian tech workers, with 3-4 token Americans in the group.

    I urge you to come to Silicon Valley and visit Cupertino, Santa Clara, Sunnyvale, etc. to see for yourself what is happening here.

    Microsoft and others *regularly* open RFP’s with requirements that are ABOVE the requirements necessary to do the work, then use that as an excuse to say that they can’t find good employees, and then use those puffed-up RFP’s to increase their H1-B quotas. Result? Docile, inexperienced Indian and Chinese tech workers who *claim* to have the necessary experience, but don’t, end up populating the coding halls of Silicon Valley.

    In addition, after 15 years of this abuse, most tech recruiting firms are now manned by Asian Indian and Chinese ex-tech workers, who blatantly “hire their own” and help grease the wheels for still more H1-B’s. It’s an outrage!

    There are TENS-of-thousands of perfectly capable Americans that are ready and willing and able to take the positions that Bill Gates and others say go wanting for talent.

    Please look into this! I have watched Silicon Valley turn into a meat-market, with a race-to-the-bottom mentality for wages, due to this H1-B abuse. The same is beginning to happen all over America, in regions where technology is taking off. This is SO unfair!

    I am not blaming the immigrants; they want to better themselves; I am blaming senior corporate executives who are LYING about shortages, and policy makers who do the latter’s bidding, because the like of Bill Gates, Google, Apple, etc. are large contributors to campaigns, and making a vote to keep America “technologically sound” makes good press.

    Mr. Moyers, I am pleading with you to look into this!

  • http://24ahead.com/ 24AheadDotCom

    If mass immig. doesn’t lower wages and safety standards, why does Big Business support it so much? Why are people like Koch, Norquist, Armey, Haley Barbour, Rubio, the Bushes, etc. etc. in favor of it?

    It’s odd how Bill Moyers would normally oppose those people on everything they do, but when it comes to mass immig. his site makes libertarian-flavored arguments just like they make.

    Note also that after legalization “immigrants often do not seek jobs already held by U.S.-born workers” will no longer apply. All those newly-legalized former illegal aliens will be able to compete for any job for which they’re qualified. In other words, someone who (because they’re an illegal alien) can only do drywall work now, after legalization will be able to compete for federal construction jobs (which are only open to legal workers). Someone who can only work as a housekeeper will be able to work as a cashier or a bank teller or a nurse if they’re otherwise qualified.

    Immig. “reform” is a great big scam designed to lower wages. And, here’s Bill Moyers supporting a scam designed to lower wages.

  • student paper

    How can I cite this piece

  • illegalsshitonus

    I am suprised that on one hand Moyers is touting his new documentary that portrays the struggle of middle class Americans. On Colbert, he said so-called middle class people are going hungry because jobs do not pay enough today, even two jobs can leave families hungry. And his solution is to encourage mass illegal immigration? Massive undocumented migration where persons have children they can’t afford in order to tap into federal, state and local social services, paid for by taxpayers? Sorry Bill, Americans are sick and tired of being told that if they just keep paying through the nose for the poor who migrate to these shores –and every other kind of poor — that eventually we’ll get it all back. Time to ask some of your big wig friends to raise the tax rate on the wealthiest Americans. Maybe Chuck Shumer could open his big mouth and tell his Wall Street pals they need to pay more taxes.

  • illegalsshitonus

    I don’t know where this weird “handle” came from, but I want you to know it isn’t mine. It just keeps popping up. In my community today, an illegal alien was arrested after a 120 mph chase that injured several people, including a young man who was seriously hurt. According to the newspaper, the man was deported numerous times, until this last incident. Now he’s been denied bail. This is not an unusual incident. Any community with illegal immigrant populations will have similar stories. These are all people who would be given the right to stay in the country — business as usual — under the Senate bill. Why are illegal aliens considered above the law? The laws supporters can keep saying that no one is hurt by illegal aliens’ crimes, but it’s all a lie. There are many crimes — identity theft, drunk driving, gang activity, dope dealing, rape and murder — that are increased. It’s just ridiculous that the Obama administration refuses to enforce existing immigration laws. Along with Holder, all of the Senators who voted for this law should be removed from office.

  • Rick De La Torre

    All this this talk of “protectionism” being fueled by lazy incompetent overpaid white workers scared to death to compete on a level playing field. You should have quit crying while you were ahead, but you took away equal opportunity from the blacks only to find a sea of hungry educated immigrants to do the jobs you were incapable of doing. Look what greed and jealousy has gotten you. You forget that the few of you who climb up the ranks and become business owners are probably even more greedy & jealous than you. So therefore could care less if you lose your jobs to immigrants & rightfully so. So keep up your jealous greedy ways & don’t blame anyone but yourselves when you get replaced, because it is people like yourselves pulling all the strings.