top of page
Writer's pictureNidhi Nair

The Effects of Immigration on the U.S Economy

A research study conducted by the Immigration Research Initiative in 2023 found that Immigrants made up 17% of the national GDP, accounting for 3.3 trillion dollars of our GDP created solely because of the presence on Immigrants. Despite these tangible benefits, polarized media has led society to believe racist misconceptions of immigrants- devaluing their impacts on our economy. Not many seem to realize the weight of these impacts; their role in our economy being seemingly irreplaceable. With hopes of creating lives for themselves, every year around 2.6 million immigrants (U.S Dept. Of State 2018) make their way over to our soil.  Our country would not be what it is today without the influences of these immigrants. This paper will discuss research on how immigrants affect the economy, specifically through identifying their influence on economic competition, workplace productivity, industry-specific reliance, and national economic strength.  


Economic Competition 

Immigrants inherently increase the competitiveness of the American economy, providing a catalyzing influence on our economies productivity. Many times, the presence of immigrants within a workplace creates a drive to become the best worker, forging more competition in the workplace.Various economies find this competition greatly beneficial; Annika Forsand (2002) highlights in Finland, “cooperative workplaces in various fields, where the collaboration between many nationalities and cultures…indicate  [workplace] ideals [that]  prove to be highly competitive in the global economy,” signifying that in Finland, immigrants increased the level of competition within the economy. Because of the presence of immigrants in the workplace, natives were driven to work even harder to ensure the continuity of their job. As a result, economies incur the most positive impacts from their citizens. Competition is what drives any free market, and without immigrants in our economy, this competition would decrease heavily. Their desire to work and willingness to put forth their best creates a guiding pathway for the American economy on its road to success. The influence of immigrants through competitiveness is also seen similarly in a study by Peri (2010): “Immigrants are usually allocated to manual intensive jobs, promoting competition and pushing natives to perform communication intensive tasks efficiently.” Peri, similar to Forsand, also highlights that immigrants keep natives on their toes- ensuring that they are giving the best bang for their buck. Immigrants serve as a way to keep competition alive in a system that oftentimes seems so stagnant. The economy gains multitudes of production benefits through the presence of immigrants since competition is the ultimate fuel for production. Within their research articles, Forsand and Peri both stress the need for competition- and thus a need for immigrants- 

confirming the impacts stated. 


 Industry Specific Reliance

Research also shows immigrants influence industries like agriculture and physical labor.  Natives tend not to go into these fields creating a significant reliance on immigrants within the industries. The existence of this reliance is seen as Lewis (2007) states “Because immigrants are disproportionately low skilled…Americans ben-efit from immigration. Economic theory says that immigration makes other inputs into production  – like skilled  labor and land relatively “scarce,” and therefore raises their market value.” Lewis highlights that low skilled labor is scarce in 1st world countries as natives tend to drift towards jobs that are higher skilled. This scarcity presents immigrants as a necessary resource for countries like the U.S identifying how much specific industries rely on immigrants to operate. Reliance on immigrants among specific industries establishes the  role they possess within our economy as one that is absolutely needed. This same idea is brought up by Singer (2012), “Recognizing the valuable role that immigrants play in the U.S. labor market and understanding the opportunity this presents for the United States are foundational to crafting coherent and pragmatic immigration policy.” Singer’s article specifically indicates the American government's reliance on immigrants. Immigrants are introduced to the U.S economy and take on jobs that are geared towards their skillset; As years go on, these jobs are often passed through families encouraging immigrants to take on the same jobs as their family members. Thus, specific sectors mainly encompassed migrant workers, reflecting industry specific reliance. Because Immigrants take up a consequential amount of the US Labor Market, Singer also highlights that the US’ reliance on immigrants could not be more prevalent. Signaling US’ growing economic reliance on immigrants, both research articles provide concise data that points toward the heavy influence immigrants have on specific industries in our labor market. 

Increasing National Economic Strength 

 Immigrants are often painted as the common villain in an overly nationalistic political agenda. Seen as the wicked outsiders amongst our society, immigrants are seen as evil “Job Stealers” among dramatic media. Although politicians like to use the fear of change as a way of influencing their constituents, this propaganda is an excellent way to deter a needed demographic away from our country. Research from George Mason University (2018)  projections, based on ACS augmented data, shows that the U.S Economic standing significantly increased with higher percentages of immigration. This standing also indicated that the per capita GDP increased when immigration increased. Americans would see a 3% increase in average income whenever there was a presence of continuing immigration. George Mason University’s findings argue that without this presence of immigration, all of these highly beneficial economic characteristics of our country would change. America is known for having the world’s number one economy and that is in part due to the presence of immigrants. Immigrants were shown to create higher per capita GDPs, national GDPs, and increase a strong national standing- all things that would cause devastating consequences if lost. In relation to the various GDP benefits immigrants bring about in the US economy, Thurston (2024) also highlights how immigrants increase US national economic strength by increasing foreign appeal: “The effects of a migrant influx can last for decades, too, enhancing a region’s attractiveness to foreign investors and opening long-term export opportunities.” Thurston highlights the global economic effectiveness that immigrants provide due to the foreign appeal they bring to an economy. Because America’s economy is involved in a highly globalized market, how appealing America looks to global traders is paramount to our economic success. If the U.S national economy doesn’t seem attractive to trade with, then the U.S will not be able to provide for its citizens. Emphasizing that immigrants increase the standing of America in the global economic market, the articles both agree that immigrants bring upon foreign appeal and increase economic strength.

Conclusion

Though much research points towards how immigrants impact economic competition, workplace productivity, industry-specific reliance, and national economic strength, there were inevitable gaps in research. One gap was the differentiation between illegal and legal migrants. Because illegal immigrants aren’t documented- their impacts and influence is seemingly impossible to correctly identify. Without documentation on taxes, social security, and job licenses, their influence isn’t easily tracked since those are the major tracking factors that help identify their impacts. To fill in this gap in research, it is essential to find sources that specify impacts between undocumented immigrants and documented immigrants. Additionally, another gap in research is finding an accurate amount of jobs( originally belonging to natives) immigrants have replaced. Because corporate America is extremely subjective, research doesn’t account for an accurate estimate of jobs acquired by immigrants for the sole purpose of replacing a native.  Many employers do not flat out mention their intention of hiring an immigrant to replace a native; thus, we cannot firmly grasp the influence of immigration on native jobs. Yes, it is popular opinion that they “take native jobs,” but there fails to be a clear correlation to both negate or affirm that statement. This influence is something that affects all lenses mentioned in this paper, but the gap doesn’t allow for a fully encompassing conclusion about its significance. Research focusing on the amount of jobless native whenever immigrant jobs spike would allow for better understanding on how many jobs natives lose to immigrants

Research has argued time after time the significant impacts of immigration on the American economy; Elizabeth Trovall (2023) spotlights how immigrants pay billions in taxes and “As it turns out, those contributions are key to the government’s fiscal health.” Yes, Immigrants might not be naturalized citizens yet, but most of them hold the same economic weight as natives. Forsand (2002) emphasizes that migrant workers increase competitiveness in national economies; Similarly, Peri (2010) also highlights that same ideal- agreeing that migrants push for more competition within economies creating more productive economies. Various industries rely on the work of immigrants, increasing the influence of immigration on the U.S Economy; Together, Lewis (2007) and Singer (2012) highlight the importance of immigrant work in low skill industries, and the U.S’s benefits they receive from that reliance. George Mason University (2021) examines GDP per capita’s growth after immigrants, suggesting that immigrants increased GDP per capita; Aligning with this national economic benefi,,Thurston (2024) also mentions immigrants led to a stronger national economy due to an increase of foreign economic appeal with their presence. Even through the extensive attacks it faces, Immigration’s impacts have never been more prevalent than today. This generation needs to be the one to look at the facts- and not biases- to find the way to keep our nation, and its economies, thriving.


0 views0 comments

Recent Posts

See All

Comments


bottom of page