State Economy Strained By First Generation Immigrants, But Breaks Even By Third

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Two major issues in the current presidential election are immigration and the economy.

A new report by the National Academies of Sciences, Engineering and Medicine finds that immigration in the U.S. has an overall positive impact on long-term economic growth in the country as whole.

It's a different story when you zoom in on the map. According to the findings, immigrants generally cost state and local governments more in services than they contribute in taxes. That's due in large part to the cost of educating the children of immigrants.

And that's true in Massachusetts — but only among first generation immigrants, who generally receive over $2,000 a year more in state and local services than they pay in taxes. However, as adults, second generation immigrants contribute far more than their parents, pumping an average of $2,300 of revenue a year into the state. When you look at the overall contribution of immigrants over three generations, the state pretty much breaks even.

"In Massachusetts, if you look at state and local taxes, the average person pays their own way," says George Borjas, a professor of economics and social policy at Harvard's Kennedy School of Government and one of the study researchers. For the report, he also looked at how immigration affects workers.

Borjas says that while the study finds the average worker might not be affected by competition from immigrant labor, there are subgroups who do feel a squeeze.

"Certain groups were affected and they were affected substantially," he says. "The group of previous immigrants, who basically compete with the new immigrants, and the group of low-skilled workers who are natives in the U.S., mainly high school dropouts, many of whom are minorities, black or Hispanic."

For these groups, the competition from immigrant workers does not appear to translate to fewer job openings, but the study found it can mean fewer hours.

Francine Blau, a professor of labor relations and economics at Cornell University and one of the study's lead researchers, says immigration has an overall, long-term positive impact on national economic growth. And in the short term, she says an influx of immigrant labor helps balance an aging workforce.

"The native supply of workers is slowing," Blau says. "What is, in a sense, keeping the labor force growing is the infusion of immigrants and the children of immigrants."

That's particularly relevant for New England, where census data show some of the highest concentrations of older residents in the country.

Jeffrey Gross, director of New American Integration at the Massachusetts Immigrant and Refugee Advocacy Coalition, says New England is a region with an aging native-born workforce.

"Going back many, many years now, the main area of growth in the labor force has been due to immigrant workers," Gross says. "This is even more key in our neighbors to the north like New Hampshire and Maine which have a predominately white and much older workforce and are now working hard to try to find ways to integrate, you know, diverse communities of immigrants and refugees who are coming into those states."


Gross says given the report's findings about the importance of the immigrant workforce in local and national economies, there's all the more need for immigration reform.

Not everyone agrees.

Steven Camarota, of the conservative-leaning Center for Immigration Studies, was an external reviewer of the report. He says while the report provides detailed data, the key issue isn't about retirees leaving jobs, it's about the competition for jobs now.

"The bigger problem for the United States is not that we have too few workers relative to retirees, it's that so many people of working-age are not working," Camarota says. "So, our problem really isn't so much that we don't have enough workers to support our retirees, it's that we don't seem to have enough jobs."

Massachusetts ranks 15th in the nation for percent foreign-born population.

This segment aired on September 22, 2016.


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Shannon Dooling Investigative Reporter
Shannon Dooling was an investigative reporter at WBUR, focused on stories about immigration and criminal justice.



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