Frontera Fund News

Immigration Reform Would Save the U.S. $570 Billion


Last year, a protest sign was splashed across some newspapers: “Secure the border. Period.”

It’s a rallying cry echoed by the U.S. government’s enforcement-centric policy and individuals who trumpet a simple solution for repairing the immigration system: make E-Verify mandatory, and send undocumented workers home.

But it’s not a message echoed by most economists. If economists made a protest sign, it would read: “Immigration boosts the economy. Period.”

In fact, comprehensive immigration reform could reduce the federal debt by $570 billion and enhance the GDP (currently $16.7 trillion) by 0.5% over 20 years, according to a report released in May 2015 from the Bipartisan Policy Center.

The study examined five potential immigration reform strategies:
1. Make E-Verify – an online system that allows employers to check immigration status – mandatory by 2020
2. E-Verify plus legalization of undocumented immigrants
3. E-Verify, legalization, and a temporary worker program
4. Increase the number of H-1B visas for highly skilled professionals
5. All of the above

The best solution is “All of the above.” Check out the impact of each strategy in the chart below.

Immigration Reform

Clearly, comprehensive reform that grows the immigrant population also grows the economy. The “E-Verify, Period” or “Secure the Border, Period” solution would shrink the labor force and therefore shrink the economy. The only thing it would grow is the federal deficit.

Numerous studies indicate that increasing the number of immigrants participating in the economy actually increases the number of jobs available, and what’s good for undocumented workers is good for the nation as a whole.

The Center for American Policy and the American Immigration Council studied the effect of legalizing workers over a period of three years. They found that: “The higher earning power of newly legalized workers translates into an increase in net personal income of $30 to $36 billion, which would generate $4.5 to $5.4 billion in additional net tax revenue… [and] generate spending sufficient to support 750,000 to 900,000 jobs.”

In Arizona, legalizing unauthorized workers would reap $540 million in tax revenue and create 39,000 new jobs.

On the other hand, if all unauthorized immigrants were deported from Arizona, the state would lose out on $2.4 billion in tax revenue.

It’s something to remember as judges continue to block the expansion of DACA, a deportation deferral program that has generated $422 million in fees and allowed nearly a million DREAMers to become eligible to work and grow the economy.