Immigration Reform Fattens State Economies, Too

Written by on July 18, 2013 in Business, Economics, Entrepreneurship, Visas with 1 Comment

shutterstock_101963995“Should the United States be pro-immigrant?” asked Tax Watchdog Grover Norquist. “That’s like asking whether McDonald’s should make hamburgers. It’s made the United States work for several hundred years. It’s what’s made us different, what’s made us more successful,” said Norquist during a recent call summarizing a new report from Regional Economic Models, Inc. (REMI) on the economics of immigration reform.

Indeed, REMI’s new report builds on the Congressional Budget Office’s (CBO) dynamic analysis of the Senate’s immigration reform bill and analyzes the bill’s key components and potential effects on all fifty states over the next  30 years. Specifically, the report explores the creation of a pathway to legal status, and an expansion of high-skilled and lesser-skilled visas. The report finds that overall economic effects of the policy changes would be positive, increasing gross domestic product (GDP) for the country and for each state, and increasing net new jobs across industries. Specifically, the report’s key findings at the national level include the following (state level fact sheets are also available from the report’s website):

  • A pathway to legal status will increase total United States employment by 594,000 net new jobs in 2018 and GDP is expected to increase by $49.9 billion by 2018. As a result, employment and GDP increase for all states.
  • Employment and gross state product is estimated to increase for all states and in all years as a result of the H-1B high-skilled program expansion: around 1.3 million jobs and a GDP increase of more than $158 billion by 2045.
  • An increase in H-2A agricultural visas would result in total employment increases of around 39,600 by 2045.
  • Fully utilizing the H-2B seasonal worker visas up to the cap will increase total U.S. employment by around 24,000-25,000 over the next 30 years.
  • The W worker visa program would lead to a total gain of around 365,000 jobs by 2045 and a rise in GDP of $31 billion.

People in every state will benefit from immigration reform, and these policy changes “will expand the economic pie for individuals and businesses across the nation,” said Fred Treyz, CEO and Chief Economist of REMI. He went on to explain that “undocumented workers, by entering the mainstream workforce, will add to overall U.S. productivity, and their increased spending will drive job growth throughout the economy.”  Douglas Holtz-Eakin, President of American Action Forum and former director of the Congressional Budget Office, noted of the report’s findings that “the primary impact is to have better state economies.”

Additionally, Norquist noted that the report “builds on the mounting pile of evidence that immigration reform strengthens the economy at the state and federal level. More immigration means a larger and more productive economy, which creates jobs and spurs economic growth.” Clearly, a growing mountain of evidence and research shows immigration reform’s potential economic benefits nationally, state-by-state, and locally, including sturdier economies, job creation and labor market growth, increased revenue, entrepreneurship and business growth, housing market growth, and stronger communities. As such, amid the ongoing legislative debate, Congress must acknowledge what they would be saying “no” to if they fail to enact comprehensive immigration reform in 2013.

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