“Illegal immigrants steal our jobs,” Donald Trump insists again and again. It is not a new line of argument, he himself has used it before and the phrase can be heard in countries around the world for many decades. But in this election year, candidate Trump has made sure to make this one of his central theses along with the alleged economic decline that, contrary to evidence supporting a robust economy in turbulent times, the policies of President Joe Biden, and now also Vice President Kamala Harris, would have led to. The reality paints a different picture that also refutes Trump on both sides: immigration, legal and illegal, has been one of the key factors that have kept the world’s largest economy going in a period of uncertainty, post-pandemic and disruptive wars.
The importance of immigrants is historical; the United States is a nation built by immigrants, the story goes. But that is where the consensus ends. In contemporary times, there are disparate interpretations of immigration and its economic impact. There are two main views that are presented as “common sense”: on the one hand, those who see that as more immigrants arrive, they compete with natives for the same jobs and the result is lower wages and higher unemployment among the native population; on the other hand, those who see a population that is aging, leaving many vacancies that could only be filled by immigrant workers. The reality, although it may seem impossible, is that to a certain extent both things are true at the same time.
Giovanni Peri, an economist at the University of California and founder and director of the Global Migration Center, a multidisciplinary research group, believes that this is due to the tendency to oversimplify a dynamic and complex reality, which is not just a simple question of supply and demand. “When immigrants enter an economy, many other things happen. Therefore, if we limit ourselves to looking at the correlation between the number of immigrants entering a market and changes in wages or employment, we could wrongly attribute effects that are due to other factors. Identifying a causal effect is not easy, but that is what I have tried to do in my work: develop methods to identify these effects,” says Peri, who has been studying the impacts of immigration on the labor market and the economy in general for more than 20 years and this year published a study major National Bureau of Economic Research study on the issue, concluding that immigration has been positive for competition and wages.
Immigrant population by educational group in the United States
For decades, a series of demographic and economic dynamics have marked the context. The birth rate has been declining for a long time, gradually shrinking the available workforce, but there has also been greater automation in many sectors, which has reduced the demand for low-educated workers, who usually fill these positions. At the same time, the economy in general has grown relatively steadily, at least when viewed from a more distant perspective, which has translated into more income and more education for the native population, that is, more qualified people doing more technical and better-paid jobs. This has again left a gap of workers for low-skilled jobs, which has also been growing, since many have to do with caring for an aging population. And these, historically, have been filled by immigrants.
Although there are many other variables that vary slightly from sector to sector or even from one geographic area to another – this is where the negative impact on job opportunities for certain native populations can be seen – it is correct to consider that immigration is filling jobs that have been left vacant by natives, says Peri.
But this only takes into account low-educated migration, which, because of legislation in place since the early 1990s that offers virtually no legal avenues for people without college degrees, has since been almost exclusively illegal. Peri is quick to note that while the image of migrants crossing the border is ubiquitous, the predominant immigration since two decades ago, when immigration laws began to be enforced much more strictly in the wake of 9/11 and the entry of undocumented migrants was sharply curbed, has actually been highly skilled.
This type of immigration, he notes, not only does not steal jobs, but creates them. “Immigrants are entrepreneurs. They start companies at a much higher rate than Americans, which contributes to job creation by generating demand for labor. Second, many immigrants are scientists, engineers, and innovators who contribute to productivity growth. Third, they are also consumers, which increases demand for goods and services, which in turn drives demand for labor.” In addition, they contribute a large amount of taxes.
The pandemic, however, broke any trend and imposed an absolutely different reality. Suddenly, immigration that had already been slowly falling due to immigration policies during Donald Trump’s presidency collapsed completely with the closure of the borders. There was a massive retirement of the generation of baby-boomers, Many people took the opportunity to better prepare themselves and look for better qualified jobs. “Because of all this, the working population has decreased and, if it were not for immigrants, [que han llegado en números récord]would have decreased even further. Immigrants are the only group that prevents the workforce and the economy from contracting,” Perri adds.
The fact that the economy has not collapsed after the blows of Covid and the war in Ukraine is also due to measures such as the Fed’s high interest rates that have managed to stabilize inflation or the enormous investment facilitated by legislation such as the Inflation Reduction Act or the CHIPS Act, which has revitalized entire sectors of the economy, but in the end the only reason why the jobs that have been consistently generated month after month have been able to be filled has been immigrants.
US population change
“What you see is that the administration is trying to find a balance between the economic need for immigrants and political pressures to appear tough on immigration. It does this by emphasizing border security or deportation in public interventions, while allowing more asylum seekers and other legal immigrants into the country. This balancing act responds to the economic reality that the United States needs immigrants to fill labor market gaps, while managing the political narrative around immigration,” says Perri, who adds that this has been the case for some time and will continue to be the case as the United States navigates its demographic and economic challenges.
Donald Trump’s Republican Party, in fact, has also toned down its message in this regard: it singles out only “illegals,” while claiming to defend legal and orderly immigration. Given this, the “largest mass deportation in history” that Trump has promised if he is elected president in November is unlikely to happen. It would be a self-inflicted economic catastrophe. What needs to happen, says Perri, is a revamp of immigration legislation so that there is a legal path for much-needed low-skilled migrants to follow.
