America has always been a nation of immigrants, and throughout the nation’s history, immigrants from around the globe have kept our workforce vibrant, our businesses on the cutting edge, and helped to build the greatest economic engine in the world. However, America’s immigration system is broken and has not kept pace with changing times. Today, too many employers game the system by hiring undocumented workers and there are 11 million people living and working in the shadow economy. Neither is good for the economy or the country. It is time to fix our broken immigration system.
Today, the President’s National Economic Council, Domestic Policy Council, Office of Management and Budget, and the Council of Economic Advisers released a report, The Economic Benefits of Fixing Our Broken Immigration System, detailing the range of benefits to the U.S. economy that would be realized from passage of commonsense immigration reform, and the high costs of inaction.
Specifically, the report finds that the Senate-passed bipartisan immigration reform bill:
Strengthens the overall economy and grows U.S. GDP: Independent studies affirm that commonsense immigration reform will increase economic growth. The Congressional Budget Office (CBO) estimated that enacting the Senate immigration reform bill will increase real GDP relative to current law projections by 3.3 percent in 2023 and 5.4 percent in 2033 – an increase of roughly $700 billion in 2023 and $1.4 trillion in 2033 in today’s dollars. A larger labor force; higher productivity and investment; and stronger technology, tourism, hospitality, agriculture, and housing industries are just some of the key ways that immigration reform strengthens the U.S. economy.
Fosters innovation and encourages more job creation and job growth in the U.S.: Evidence shows that immigrants are highly entrepreneurial. Immigration reform would streamline the process for highly-skilled and highly-educated workers to come to the U.S. and build businesses that create jobs for Americans. In addition, it encourages companies to locate, invest, and expand here in the U.S. Under the recently passed Senate legislation, entrepreneurial immigrants would be eligible for newly created temporary and permanent visas if they demonstrate that they have ideas that attract U.S. investment or revenue and establish businesses that create jobs.
Increases the productivity of workers and adds new protections for American workers: According to CBO and other independent studies, immigration reform will ultimately increase overall U.S. productivity, resulting in higher GDP and higher wages. Part of this gain in productivity comes from immigrants’ creating new inventions and companies, as well as from improvements in U.S. production processes. Bringing undocumented workers out of the shadows and into the legal economy also helps put a stop to practices that undercut wages and worsen working conditions for American workers. This bill also has provisions to protect U.S. workers and ensure that new worksite enforcement and border security measures deter future illegal immigration.
Decreases budget deficits, balances out an aging population, and strengthens Social Security: The CBO found that the enacting Senate immigration reform bill will reduce the federal budget deficit by nearly $850 billion over the next 20 years. In addition, the independent Chief Actuary of the Social Security Administration (SSA) has found that immigration reform will improve the long-term financial standing of Social Security by adding younger workers to the U.S. workforce. The SSA Actuary estimates that the Senate’s immigration reform bill will add nearly $300 billion to the Social Security Trust Fund over the next decade and would improve Social Security’s finances over the long run, extending Social Security solvency by two years.
Key Benefits to the U.S. Economy
- GDP: Under the Senate bill, the economy would grow 5.4% more over the next two decades, due to a larger labor force, higher productivity and more investments
- Productivity: Productivity of labor and capital would increase by 1 percent over the next two decades.
- Wages: Largely as a result of higher productivity, real wages will rise by 0.5 percent in 2033 relative to current law – the equivalent of about an annual $250 increase today for a median household.
- Federal Deficits: Over the next twenty years, federal deficits would be reduced by nearly $850 billion.
- Federal Debt: U.S. debt would fall by 3 percentage points as a share of the economy by 2023, compared to current law
- Social Security: The solvency of the Social Security Trust Fund would be extended by two years and the 75-year shortfall would be reduced by nearly half a trillion dollars.
- Entrepreneurship: Entrepreneurial immigrants are eligible for newly created temporary and permanent visas if they demonstrate that they have ideas that attract investment and establish businesses that create jobs.
- Housing: Housing market recovery would be strengthened through stronger demand and higher prices for homes in neighborhoods hardest hit by the recession.
- Tourism and Hospitality: Provisions in the Senate bill position – including the Visa Waiver Program, new CBP officers, and permanent authorization of the Corporation for Travel Promotion – would provide significant boost to tourism and hospitality.
- Agriculture: U.S. agricultural output and exports would grow over time – supporting a key engine of American economic growth.
Documents & Reports
The Economic Benefits of Fixing Our Broken Immigration System: Per State (PDF Format)