Today the Trump administration is set to roll out a revision of its immigration executive order, and the president's travel ban on people from several Muslim-majority nations has been a lightning rod in the national discourse. But beyond the controversy, it's also ignited the debate over what true value immigrants bring to the U.S. economy versus potential risks.
To make a dramatic point, last month workers around the country staged the Day Without Immigrants, a walkout protest to show the country what life would be like without its foreign-born workforce. It was an event that made headlines both during and after, as outlets around the country reported over 100 firings in the wake of the protest. Fallout aside, however, the event did raise a point. Immigrants play a huge and productive role in the national economy.
Immigrants make up 17% of the U.S. workforce, and of that, 5% are undocumented. Making up a little under 13% of the entire United States, one of the missing pieces to the modern debate over immigration and the American workplace is just how essential this population has become.
Despite the political aggression leveled at immigrants (and, primarily, Hispanics), one of America's dirty little demographic secrets is how essential they've become to the U.S. labor force, and in fact the population overall. In a nutshell, America doesn't just need to keep letting immigrants in… we might need a whole lot more of them.
As we've written in the past, the American birth rate is declining. It has for years, but last year the birth rate tumbled to its lowest level since recordkeeping began. By some measures, including the CIA's own Fact Book, it has fallen below replacement rate (the birth rate necessary for a population to sustain itself).
Putting a number to the problem, America's replacement fertility rate (the number of children per mother) needs to be 2.08. Our actual fertility rate is 1.87.
Yet the population is growing, and that's almost entirely due to immigration. By the middle of the century, Pew researchers expect foreign-born Americans to account for almost all of the country's population growth.
Which brings us, at long last, to macroeconomics.
Population plays an enormous role in labor sector dynamics. Without enough workers to fill jobs employers have to compete for an increasingly scarce resource. While that can be good, it also can drive up inflation, raise consumer prices and cause the economy to stall out for lack of opportunity.
Even more big picture still, though, the economy contracts without a growing workforce.
"Labor force growth is one of the factors that allows the economy to grow," said Tim Duy, a professor of economics with the University of Oregon, "and we know that fairly low labor force growth really does reduce the speed limit of the U.S. economy. So I think that's certainly one factor that I consider, is that we certainly do need some immigration in order to grow."
Economic growth is ultimately a factor of two forces: how much labor an economy puts in and how much it can produce with each man hour. In other words, how many workers make widgets and how many widgets can they stamp out? Technology is the main driver of productivity increases, but the amount of available man hours is almost entirely a factor of the labor force.
The past two decades have shaken both of these dynamics. No new technologies have disrupted the workplace since the advent of personal computing. Although more widespread automation has pushed productivity somewhat, most workers still produce about as much per hour as they did in 2007 or even a decade before that.
Worse, the labor force itself is gradually slipping. As the Baby Boomers retire, the smaller generations following in their wake simply can't replace the number of departures.
They have to, however. Without a miracle technology to push productivity through the roof, economic growth is going to depend on a burgeoning work force. Something will have to fill in the gap.
That something is a green card.
"Having more workers is important," said Duy, "and being able to match those workers up with new capital and new skills is important as well… Lower labor force growth would translate directly to lower economic growth. Of course this has been a concern as Baby Boomers age, to what extent is the generation coming up behind them large enough to keep up some of the growth rates we saw prior to the recession."
America's non-native population has already had a transformative impact on the workforce. Although they do a vast number of the un- or low-skilled jobs, including a predominance in the agricultural and food service industries, immigrants also heavily staff potentially surprising areas. According to data from the Census Bureau, immigrants work in a sweeping variety of fields. Some of the most common include: college education, health care and software development.
This is not to say that they don't fill out low-skill professions; there's no question that immigrants (particularly undocumented ones) play a major role in staffing industries like farms and restaurants. However even there, this population fills an important role, doing jobs that Americans have proven unwilling to take.
Expelling all the hands on a farm wouldn't create many jobs for the average American, simply because few want that job in the first place.
Most people who oppose immigrant workers do so for fear of job loss, and for those who struggle it would be arrogant in the extreme to say that their problems aren't real. But saying that someone has misidentified their problem isn't the same thing as saying it isn't real.
Many people struggle to find work, and many others have dropped out of the labor force and given up, but, as Duy explained, that's not necessarily because an immigrant came and took their job.
"The reasons for that labor force participation decline could be they don't necessarily have the skill levels to fit into the economy," he said. "It could be geographic preference, it could be the jobs are not where the workers are and the workers are not willing to move for those jobs."
"I don't see this as a contradiction, I see this as a to what extent can we target policies at people who have dropped out of the work force and draw them back in."
Is that to say that there are no individual cases of displacement? No. Certainly some stories end badly, but they're the minority.
The U.S. economy depends on growth. The idea that each generation can do better than the last is fueled entirely on the promise of economic growth. Retirees on Social Security and Medicare collect far more in benefits than they ever paid in, and those subsidies depend on economic growth.
All of that needs a growing labor force to sustain.
America isn't producing enough people to get that growth on its own. Behind all the moving pieces of the immigration debate is this one, fairly unmentioned truth: they don't need us, they can always move somewhere else, but unless the fertility rate skyrockets, well…we need them.