Without immigration, America will lose its economic edge

Concerns about the impact of immigration on the lives of native-born Americans have existed for centuries, from the nativism expressed by the Know-Nothing Party, to the quotas of the 1920s to the anti-immigrant sentiments held today. Advocates against immigration, such as Harvard economist George Borjas, defend these sentiments on the grounds that immigration results in fewer jobs for native-born Americans. However, while immigration increases the supply of labor and therefore makes the job market more competitive, other research suggests that immigration does not take away American jobs in the long run.

Employment data also displays that immigrants tend to seek forms of employment that differ from the work that native-born workers pursue. Rather than taking away the jobs of native-born workers, immigration might even increase the amount of jobs available, and in the end, the net economic benefits of immigration exceed the costs. Importing highly skilled workers is less expensive for the American economy as well, and encouraging people with different perspectives of the world to bring their talents to America drives innovation. In turn, this innovation creates more job opportunities for native-born Americans.

Although immigrants make the American job market more competitive, they do not necessarily take away American jobs. A September 2016 report by the National Academies of Sciences, Engineering and Medicine found that immigration does not, in the long run, negatively impact the overall wages or employment of native-born workers. Immigrants from previous generations who remain in the same low-wage labor markets may have greater difficulty securing employment due to increased competition from new immigrants, and teenagers who did not complete high school may also experience greater competition for low-wage labor. However, there are many other factors that contribute to why young people without high school diplomas struggle to find jobs.

Immigrants competing in the low-wage labor market also tend to have different occupations compared to native-born, low-wage workers. The Urban Institute, a Washington, D.C.-based think tank, found that immigrant workers without high school diplomas work mostly as maids and housekeepers, cooks and agricultural workers. In contrast, native-born workers without high school diplomas work mostly as cashiers, truck drivers and janitors. Although immigrants compete for low-wage employment, this data indicates that they may not compete with native-born workers as much as some economists have implied. The employment niche that low-wage immigrant workers fill overlaps with native-born workers in some areas, but each group is largely separate. For this reason, immigrants may be taking jobs that would not be easily filled, and this makes the economy more efficient, benefitting Americans as a whole.

Research from economists at Indiana University and the University of Virginia suggests that immigrant employment may benefit native-born workers by generating new employment opportunities. The 2015 study conducted by Gihoon Hong and John McLaren found that immigration increases the demand for goods produced by “non-tradable industry,” which includes jobs in hospitality, teaching and retail. Non-tradable industry provides employment to local workers whose goods and services are sold domestically. Increased demand for these goods and services incentivizes firms to expand and provide more jobs. According to the study, each new immigrant produced approximately 1.2 jobs, meaning that if 100 immigrants moved into a town, for example, the local economy would gain 120 jobs. These findings imply that immigration does not hurt American workers but that it actually helps them.

Immigrants may also help native-born workers by spurring innovation and creating new employment opportunities. By working for companies in the U.S. or by starting new businesses, immigrants contribute to innovation that creates growth and provides new employment opportunities for native-born workers. Steve Jobs, the former CEO of Apple Inc. and a revolutionary figure in computer technology, was the son of a Syrian immigrant. Elon Musk, the CEO of SpaceX and Tesla Inc., immigrated to the U.S. from South Africa. Sergey Brin, who co-founded Google, emigrated from the former Soviet Union. These individuals are only a few of the many immigrants that have fueled technological innovation in the U.S. Had the U.S. restricted their access for fear that they would outcompete native-born workers, the U.S. would have lost the opportunity to further its technological superiority.

U.S. employers in the field of science and technology need immigrants in order to compete with firms from other countries. The number of talented workers that the U.S. produces is not large enough to satisfy the demand of U.S. businesses. If the U.S. intends to maintain its long-term technological and innovation advantages, it must either increase the amount of talented workers born in the U.S. or import workers from other countries. The first option requires increased funding for education, which is costly and, given the trend in education funding over the past decade, unlikely to occur. According to the State Higher Education Executive Officers Associations, the percentage of state and local tax revenues allocated to higher education has dropped from 7.6 percent in 2003 to 5.5 percent in 2013. Although increased funding to education would strengthen the U.S. economy in the long run, using immigration to supplement the needs of firms is a cost-effective solution while states continue to lower higher education funding. U.S. firms cannot maintain their long-term technological and innovative advantages when less money is being spent on higher education unless they hire workers from outside the U.S. Unless states decide to allocate more tax revenue to colleges and universities, immigration is the best way to maintain U.S. technological and innovation superiority.

Immigrants provide a net economic benefit to the U.S. economy, providing new employment opportunities to native-born workers and satisfying the employment needs of the most innovative U.S. firms. The U.S. cannot maintain its long-term technological and innovation advantages without highly-skilled immigrants, and limiting immigration hurts American economic progress.

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