Does illegal immigration help or hurt the U.S. economy?
It sounds like a simple enough question. But, like the classic Japanese movie “Rashomon,” in which truth depends entirely on point of view, the answer hinges on where you fit in the economy.
If you own a farm, a restaurant, a garment factory or a landscaping company, you’re likely to say immigration helps. Immigrants provide a ready source of relatively cheap labor that keeps your business humming and elevates profits.
If you’re an American-born high-school dropout seeking work, you’re likely to say immigration hurts. Immigrants are taking entry-level jobs at lower wages than you’d accept.
The impact on other groups – taxpayers, consumers – is open to a variety of interpretations. Each question about the impact of illegal immigration on the economy has many answers, and those are often heavily influenced by ideology.
Q: What are the effects of illegal immigration on the overall U.S. economy?
A: There’s no dispute that a larger pool of workers – whether legal or illegal – boosts gross domestic product. More workers means more output. More people means more consumers spending money on food, rent and a range of necessities and luxuries.
A better question is: How do immigrants affect the size of the economy per U.S.-born citizen?
“GDP per domestic person goes up,” said James Smith, a senior economist at the Rand think tank in Santa Monica and lead author of the National Research Council’s study “The New Americans: Economic, Demographic and Fiscal Effects of Immigration.”
Since 1980, he said, all immigrants, including both undocumented and legal, have boosted GDP by $10 billion per year. “That’s not to be sneezed at,” he said. “On the other hand, we have a $10 to $11 trillion economy” so proportionately, it’s a small impact.
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Even experts in the field say that financial analysis alone misses the big picture.
“The reality of the immigration debate is it’s nothing to do with economic impact,” Card said. “That’s just a smoke screen. It’s all about cultural protectionism and fear of change.”
Martin said many pro-and-con immigration arguments are overblown.
“Immigrants are not going to be the economic salvation of a country, but they’re not going to be the road to hell either,” he said.