Immigration: What Eliminating Immigrants Would Mean for the Economy

Immigration is a hot topic in the United States, and some citizens want to remove all immigrants from the country. Others want stricter tax laws and options when entering the country. But what would happen if all of the 43.7 million immigrants were removed from the United States?

Labor Shortages Would Increase

Labor shortages are a real threat in the United States. Removing 43.7 million people would result in a much larger labor shortage in key industries. One issue, despite the unemployment rate falling below 4%, is that businesses have to turn down work.

Existing employees are being forced to work longer hours, and as baby boomers retire, the shortage will only worsen.

Lack of Competitiveness in Some Industries

Skilled workers will be entering many fields, including the tech field, in lower numbers, too. Immigration can be illegal, but there are also negative impacts occurring in legal immigration avenues.

For example, H-1B visas had denials increased by 41% in the last quarter of 2017.

Google, Amazon and other large companies hire skilled immigrants, which have a unique skill set or education, using legal visa avenues. As the fight against immigration continues, the lack of approvals for these visas may make the US less competitive in several markets.

Major Loss in Tax Revenue

There’s a misconception that immigrants do not pay taxes to the government. Many people assume that immigrants take more from the government than they contribute, and this is not the case. A lot of immigrants, and there are exceptions, contribute more to taxes than they take in government benefits.

Second generation immigrants contribute $1,700 per person per year to tax revenue. Native-born Americans contribute $1,300 per year on average. Yes, first-generation immigrants do cost the government $1,600 per year, but this burden is more than accounted for by subsequent generations.

Overall, long-term economic growth in the US is better thanks to immigrants.

GDP Would Fall 5.7%

Studies show that if all immigrants were removed from the United States, the entire GDP would fall 5.7% – that’s substantial. Instead, many experts recommend a path to citizenship that would allow for a stronger labor market.

Immigrants are often harder workers than Americans, and the pay for an immigrant is much lower in many cases.

These “advantages” of immigrants, or really the companies that hire illegal immigrants, would start to fade with a clear path to citizenship. An improved path to citizenship would allow for stricter labor laws for immigrants, allowing citizens to compete for the same jobs and also help improve the financial situation of immigrants.

From an economic perspective, it makes better sense for immigrants to have an easier path to citizenship.

Immigrants account for 17% of the labor force, and while they do take jobs away from Americans, these are jobs that Americans normally don’t take. In essence, immigrants are taking jobs that no one else wants, helping boost many industries and offering a complement to the native-born workers.

Removing immigrants from the US would have a devastating impact on several industries, tax revenue would be lower and a major gap in the workforce would exist.