Biden Signs Executive Order on Asylum Seekers.
On June 4, 2024, President Joseph Biden signed an Executive Order allowing border agents to deny entry to humanitarian asylum seekers who do not have an appointment. This change follows a recent bipartisan agreement aimed at increasing the cap on asylum seekers, although the limit set by the White House is still lower than the current number of asylum seekers at the border.
Despite a decline in border encounters, policymakers continue to seek further restrictions. This bipartisan approach stems from widespread misconceptions that immigration threatens the economic stability of the middle class. Although many U.S. citizens view immigrants positively, a significant portion believes that ongoing immigration at current levels could weaken the economy.
Economic Contributions of Immigrants
Contrary to common beliefs, immigrants do not take jobs from native workers. Instead, they create higher demand for goods and services, which leads to job growth. While some critics highlight remittances—money sent back to home countries—as a drain on the U.S. economy, a recent report from the Center for Latin America and Latino Studies (CLALS) suggests that remittances actually reflect immigrants’ economic contributions.
Immigrants who send remittances contribute approximately $2.2 trillion annually to the U.S. economy, accounting for about 8% of the nation’s gross domestic product (GDP). In comparison, this contribution exceeds the entire economy of Canada. For context, remittances reached $81.6 billion in 2022.
Research indicates that remittances make up 17.5% of immigrants’ income, suggesting their total income is around $466 billion annually. The difference between what they produce and what they earn means this group of immigrants generates at least $2.2 trillion in economic output.
Dispelling Misconceptions
These figures reveal two key points about the economic impact of immigration. First, remittances represent only 4% of the total economic value generated by immigrants. While these transfers are important for recipients, they do not drain resources from the U.S. economy. In fact, 96% of the wealth generated by immigrant labor remains in the country. Second, the contributions of immigrants are likely underestimated since many do not send remittances or do so through informal channels.
These findings highlight the vital role immigrants play in strengthening the economy. While remittances support families across borders, they often lead to long-term family separation. Additionally, immigrants stimulate economic growth through their spending in the U.S., creating jobs and demand.
If immigrants formed a state, their contributions to the national GDP in 2022 would surpass those of Illinois and New York.
Long-Term Benefits of Immigration
In the short term, an influx of immigrants boosts the U.S. economy. In the long term, they help maintain a younger demographic in an aging population. For instance, Hispanic individuals currently make up 25% of children in the U.S. Immigrants also play crucial roles across various economic sectors and are often willing to relocate based on job availability.
Growing Consensus on Immigrant Contributions
There is increasing agreement on the significant contributions of immigrants to the U.S. economy. The Economic Policy Institute has found that immigration does not lead to higher unemployment for U.S.-born workers. In 2023, the unemployment rate for native workers averaged a record low of 3.6%. Immigrants represent about 18.6% of the U.S. labor force and work in various industries across all wage levels.
The Congressional Budget Office recently reported that immigration is key to economic growth, projecting a 2% increase in real GDP over the next decade due to immigration. Additionally, immigrants contribute to government revenue and help sustain population growth, which is vital for economic expansion. The U.S. Census Bureau warns that lower-than-expected immigration could lead to population decline and stunted economic growth within 20 years.
According to a Washington Post article, about 50% of the labor market growth in 2023 came from foreign-born workers, similar to trends seen in the 1990s.
Immigrants are integral to American life. In 2021, 45 million immigrants lived in the U.S., making up 14% of the population. The Immigrant Research Initiative estimates that immigrants contribute 17% of U.S. GDP, a figure higher than their population share.
With a $19.6 trillion economy, as reported by the Bureau of Economic Analysis, immigrants collectively account for around $3.3 trillion in economic output. This aligns with the earlier estimate of $2.2 trillion, considering many high-earning immigrants do not remit significant amounts.
Conclusion
In conclusion, the U.S. economy relies on the contributions of immigrants for year-to-year growth. If immigration decreases in the coming years, economic growth could falter, and inflation may rise. This situation is not unique to the U.S.; other countries face similar challenges.
The evidence is clear: immigration is not only a humanitarian issue but also an economic necessity for large economies. Immigrants, refugees, and asylum seekers bring talent, create jobs, and foster economic growth, ensuring a stronger future for the U.S. economy.
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