Wednesday, April 21, 2021

U.S. Needs More Immigrants For A Healthy Economy

Immigration is a hot-button issue these days. That's because the Republicans have demonized immigrants. If they had their way, immigration would be vastly reduced, or stopped entirely. But doing that would be detrimental to this country and its citizens. To maintain a healthy and growing economy, we need more immigrants -- not less.

The following is part of a thought-provoking article by Justin Gest at

During four years in office, President Donald Trump reduced immigration admissions in every way that American law makes possible without congressional approval -- cuttingrefugee numbers, deporting law-abiding members of American citizens' families and thenfinally halting all entry to the US amid the pandemic for a period before blocking the issuance of new green cards. In 2020, virtually zero migration was no longer just a thought experiment; it was, at least for a period of time, policy.

As the US government now grapples with a backlog of asylum-seekers and immigrants at the southern border, a team of economists, demographers and I modeled what America would be like if those earlier policies were to continue hereafter. Commissioned by the bipartisan immigration advocacy group, our independent research used the most recent US Census and economic data to project the outcomes of a variety of different policy scenarios -- one that cuts immigration to zero as Trump effectively did in 2020; one that cuts immigration admissions in half; one that extends recent levels; one that increases recent levels by 50%; and one that doubles recent levels.

The general trend in our modeling is clear: the more immigrants, the merrier.

In short, if immigration remained at near-zero levels, within decades, the country could be older, smaller and poorer. But if the US government welcomed more newcomers, within decades, the country could be younger, more productive and richer.

Immigrants are both a primary source of American workers and population growth. According to 2019 figures from the Bureau of Labor Statistics, even though almost 14% of the US population is foreign-born, 17.4% of the US labor force is foreign-born. And, according to 2017 data from Pew Research Center, while US-born fertility rates are about 56 births per 1000 women, US immigrant fertility rates are about 77 births per 1000 women.

So when immigration admissions are cut to zero, our population ages faster and shrinks. And because the US relies heavily on immigrant labor and innovation, when admissions are cut to zero, Social Security quickly becomes insolvent and our productivity stagnates.

Perhaps more importantly though, we find that even recent levels of legal immigration -- the approximately 1 million people per year that the US has traditionally granted permanent residence over the last few decades -- are not enough for the country to maintain historic rates of productivity. It is only through increased immigration that the United States can achieve a sustainable working-age population, economic growth and a solvent Social Security system. . . .

According to our research, by 2060, the share of the population between 18 and 65 -- working-age -- is projected to be nearly 62% in the scenario that doubles the current annual number of immigrant admissions. If immigration is cut to zero, it would be less than 56%. While this difference may seem small, it significantly affects the balance between workers and the elderly -- who are less likely to work or contribute to the tax base, and more likely to draw on government benefits and services. Where there were only 25 elderly persons per 100 working-age people in 2018, by 2060, we can expect nearly 50 elderly persons per 100 working-age people in the case of zero net migration, but only 30 in the scenario involving doubled admissions.

The zero-immigration scenario predicts real GDP of only $32 trillion by 2060, more than 27% lower than if recent trends were to continue. Were Congress to maintain the current mix of visas but double annual admissions, the US would increase economic growth by over 40% relative to the scenario that extends 2018 baseline trends.

Meanwhile, increased immigration is one way to sustain current expenses associated with Social Security payments. In 2018, Social Security payments accounted for about a quarter of all federal spending, and this share would stay the same if immigration admissions were doubled. However, if current trends were to continue, this share would rise to about 31% in 2060. And if immigration were cut to zero, Social Security payments would eventually consume 35% of the federal budget -- squeezing other federal programs. . . .

No doubt, the US needs an orderly system of migration management. But the young and industrious newcomers yearning to stabilize their lives and secure their survival are actually critical to our nation's survival, too.

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