Report: Immigration and American Jobs

The U.S. labor market has been slow to recover from the deep recession of 2007–2009. Policymakers have debated numerous ways to increase employment, from government spending to tax policy to training and education initiatives. But relatively little consideration has been given to immigration reform as a way to boost the economy, even though immigration policy affects innovation and job growth. Instead, the immigration debate has become painfully deadlocked, with widespread agreement that the current system is broken but little consensus on how it should be fixed.

In these challenging times, more should be done to identify incremental changes to immigration policy that could be made immediately to boost employment for U.S. workers and accelerate the country’s economic recovery.

To better understand the potential for immigration policy to help rejuvenate the U.S. economy, policymakers need answers to basic questions, such as whether the foreign-born take jobs from the native-born or instead create more jobs, and what types of immigrants generate the most jobs for native-born workers. Although numerous studies have explored how immigration affects natives’ wages, there is relatively little research on how immigration affects employment among U.S. natives.

A new report (PDF) seeks to fill in the gap and answer the question of what specific changes to immigration policy could speed up American job growth.

Four key findings:

1. Immigrants with advanced degrees boost employment for U.S. natives.

This effect is most dramatic for immigrants with advanced degrees from U.S. universities working in science, technology, engineering, and mathematics (STEM) fields:

• An additional 100 immigrants with advanced degrees in STEM fields from either U.S. or foreign universities is associated with an additional eighty-six jobs among U.S. natives.
• An additional 100 immigrants with advanced degrees—regardless of field or where they obtained their degrees—is associated with an additional 44 jobs among U.S. natives.

2. Temporary foreign workers—both skilled and less skilled—boost U.S. employment.

The data show that states with greater numbers of temporary workers in the H-1B program for skilled workers and H-2B program for less-skilled non-agricultural workers had higher employment among U.S. natives. Specifically:

• Adding 100 H-1B workers results in an additional 183 jobs among U.S. natives.
• Adding 100 H-2B workers results in an additional 464 jobs for U.S. natives.
• For H-2A visas for less-skilled agricultural workers, the study found results that were positive, but data were available for such a short period that the results were not statistically significant.

3. The analysis yields no evidence that foreign-born workers hurt U.S. employment.

Even under the current immigration pattern—which is not designed to maximize job creation, has at least eight million unauthorized workers, and prioritizes family reunification—there is no statistically significant effect, either positive or negative, on the employment rate among U.S. natives. The results thus do not indicate that immigration leads to fewer jobs for U.S. natives.

4. Highly educated immigrants pay far more in taxes than they receive in benefits.

In 2009, the average foreign-born adult with an advanced degree paid over $22,500 in federal, state, and Federal Insurance Contributions Act (FICA, or Social Security and Medicare) taxes, while their families received benefits one-tenth that size through government transfer programs like cash welfare, unemployment benefits, and Medicaid.