When it comes to the immigration quagmire in the United States, we often overlook the most simplistic question that people are looking to have answered: what effect does immigration have on the average American, if any?
In aggregate, legal immigration tends to be a net benefit for society. The future of our economy will actually rely heavily on immigrants to pick up economic slack created by an aging population. Immigrants bring with them ideas, skills, and abilities — collectively referred to as human capital — which add to the economy. Adding to the population increases demand for product and services, opening up new business opportunities as well. The trick is to find the ideal mix of public and economic policy to successfully integrate new Americans into our system, and benefit from what they have to offer.
Concerns about immigration are often concentrated in the working and middle classes. One major distinction between the two classes is that there are those people who are currently working toward finding sound economic footing (the working class), and those that have already made it (the middle class). These are the people that are most deeply affected by the influx of new Americans in one way or another, and therefore have the most cause for concern.
With all of that on the table, here are five real, direct ways in which immigration impacts working Americans, both positively and negatively.
1. Unskilled workers face competition
Likely the biggest fear from American workers is that they will be replaced by cheaper, foreign labor. In some cases, this is a legitimate concern, but only for unskilled workers employed in highly competitive jobs. The reason for those displacements is typically because immigrant workers can be more productive and motivated. Illegal immigrants don’t pose a threat to most people’s jobs, but some Americans at the bottom of the economic ladder are exposed to risk.
2. Drain on social programs
One of the oft-repeated criticisms of recent immigrants is that they are a drain on social welfare programs. This tends to upset people, particularly when discussing illegal immigrants, since they typically aren’t taxpayers and getting enrolled in these programs represents a transfer of wealth from natives to new arrivals. We’ve looked into the subject before, and found that both legal and illegal immigrants tend to use social programs more than natural-born citizens. There is justifiably some resentment toward those using those programs unlawfully, after having skirted the legal route to immigrate.
When immigrants enter the country illegally, they can become a drain on public resources — to the tune of up to $20.2 billion annually — which is what tends to anger many taxpayers.
3. Increased economic output
From the negative to the positive now — there are actually plenty of reasons why Americans should embrace reforms to help the naturalization process become more efficient. That’s because legal immigration tends to be a net benefit for society. The future of our economy will actually rely heavily on immigrants to perform jobs that many Americans don’t want to do, or feel is beneath their pay grade.
As mentioned previously, immigrants represent human capital (new ideas for inventions or ways to improve old systems, for example) that can add to the economy. Adding to the population increases demand for product and services, opening up new business opportunities as well. The trick is to find the ideal mix of public and economic policy to successfully integrate new Americans into our system, turning that into a positive note.
According to the Obama administration, revamping our current immigration system could boost economic output between 0.4-0.9% in the next decade, essentially adding as much as $210 billion to America’s GDP by 2024. Among the benefits from that increased output are higher wages, a larger workforce, and a smaller budget deficit.
4. Immigration allows natives to specialize
When there are more workers to do the jobs nobody wants to do, that makes room for natives to move up the ladder if they’re willing to work for it.
“U.S.-born workers also have the potential to benefit from bringing undocumented workers out of the shadows,” Jason Furman, chairman of the Council of Economic Advisers, wrote in an op-ed for CNN. “Better job matches for immigrants also lead to increased productivity for native workers by allowing them to specialize in the tasks best suited to their abilities as well. And incorporating undocumented workers into the mainstream economy, with the protections that it affords and the taxpaying that it obligates, protects American workers from unfair competition.”
5. Tax issues
As mentioned above, illegal immigrants using up public resources can account for up to $20.2 billion annually in government spending. The solution, while undoubtedly complicated in the making, will be to reform the system to get those that are in need quickly and efficiently into positions where they can become taxpayers in efforts to offset some of those costs.
Not only will adjusting the system to allow immigrants to become taxpayers faster help with social programs, but also with the associated costs of policing and guarding borders as well. More taxpayers and more economic output are net positives for the country, and as of right now, finding ways to facilitate and streamline new Americans into the economy is the fastest way to reap the benefits.
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