economic growth

How immigration Impacts Economic Growth

By Peek & Toland on July 26, 2017

There has been considerable debate in recent months about whether immigration has a positive or a negative impact on the economy and the lifestyle of the United States. A recent study suggests immigration has a more dramatic impact on economic growth than many people think.

Statistics from the U.S. Census Bureau reveal immigrants are responsible for almost half of the growth of the population of the United States. They are also responsible for a considerable rise in the U.S. labor force.

The report on CNBC was based on assumptions relating to the projected increase in the population and GDP of the United States.

The relationship between immigration and economic growth

Immigration impacts economic growth

Joel Prakken, senior managing director and co-founder of Macroeconomic Advisers, said projections that the economy will grow by 2 percent link labor size growth to an increase in productivity.

Prakken said immigrants appear to make up a larger portion of the growth in the labor force. The population of the United States is aging but immigrants tend to be younger. They may come to the United States specifically to seek jobs. He said:

“Most people are totally shocked when they actually process the fact that immigrants are already almost half of the population growth, assumed in our 2 percent GDP projection and by the time you get to 2045, 80 percent of it is.”

The increase in the proportion of the population born in the United States is expected to fall due to the aging of the population and declining fertility rates.

Could Moves to Cut Immigration Impact Economic Growth?

Prakken said he’s concerned a proposed bill in the Senate would limit immigration. This legislation would half the 1.1 million immigrants who arrived in 2015 if enacted. Prakken said over a period of time that could dent the growth rate of 2 percent by approximately a quarter point. Over time the impact on the economy could become more progressively more serious.

The census assumes immigration will continue to increase. However, the bill would not allow for any growth.

A raft of studies has pointed to the positive impact immigration has on economic growth. Last year we noted research from the National Academy of Sciences that noted immigration may have a beneficial impact on the wages of local workers.

If you or a family member needs the services of an experienced Austin immigration lawyer please contact us here.

Posted in Immigration, Immigration Reform

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Study Finds Immigrants Are Vital to Economic Growth

By Peek & Toland on December 5, 2016

Our Austin immigration attorneys often hear arguments that immigrants are taking jobs from local people and causing chaos in the economy. However, a recent study suggests otherwise and points out immigration is vital for economic growth.

The importance of immigrants to the economic growth of America was the conclusion of the report on The Economic and Fiscal Consequences of Immigration from the National Academy of Sciences (NAS).

It lists three reasons why immigrants are crucial to economic growth – entrepreneurship, force growth and human capital.

Immigration has a positive impact on economic growth

Immigration may fuel economic growth

Some of the key recommendations of the study were as follows.

When quantified over a decade or longer, the effect of immigration on the salaries of locally born workers is insignificant. Negative impacts are more likely to impact previous immigrants or native-born workers with a low level of skills.

Some evidence suggests an influx of skilled migrants may have a positive impact on wages for native-born workers.

There is little evidence that immigration impacts the levels of employment of American-born workers. However, immigration may affect the number of hours worked by native teens.

Immigration Boosts Economic Growth

Immigration has a beneficial impact on the economic growth of the United States in the long term.

First generation immigrants cost governments more in terms of welfare programs and for the education of their children. However, once they grow up, the children of first generation immigrants contribute more in taxes than both their parents and native-born workers.

The study found some countries with little immigration are suffering. Japan is not known for its welcoming attitude to immigrants. It’s also facing a demographic and an economic crisis. Its problems include deflation and a lack of workers.

The National Academy of Sciences study found a supply of immigrants, human and physical capital, innovation and entrepreneurship are vital to sustained economic growth.

The value of immigrant entrepreneurship is made clear in a recent National Foundation for American Policy study. It looked at 87 startup companies valued at $1 billion or more. More than 50 percent of the firms had at least one immigrant founder. The article pointed out the companies are worth $168 billion, almost half of the total value of the stock markets of Mexico and Russia.

If you are a foreign investor who is seeking to set up a company on Texas or if you believe workers from another country could help you we’d like to hear from you. Contact our Austin immigration lawyers at (512) 474-4445.

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