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Are Illegal Immigrants Good for the U.S. Economy?

There are currently 12 million people living in the United States illegally

Undocumented immigrants contribute to our economy as workers, taxpayers, and consumers. They account for 5 percent of the total U.S. labor force, and at least a quarter of the workers in industries like construction, agriculture, groundskeeping, meat processing, and textile production.

All undocumented immigrants pay sales and property taxes, and—contrary to popular belief—most pay federal and state income taxes as well, even though they're not eligible for Social Security, Medicare, or the many other programs their tax dollars help fund. Undocumented immigrants also spend billions of dollars each year, which supports our economy and helps create new jobs.

A 2006 study by the Texas State Comptroller estimated that the 1.4 million undocumented immigrants in Texas alone added almost $18 billion to the state's economic output, and more than paid for the $1.2 billion in state services they used by generating $1.6 billion in new state revenues.

The contributions of undocumented immigrants would be even greater if they were able to earn legal status. Workers who are not part of an underground economy and don't live in fear of deportation are better able to acquire new job skills and move up the career ladder. That translates into higher wages, more money paid in taxes, and more money to spend.

Undocumented immigration is a symptom of an immigration system that is broken. Lawmakers should revamp our immigration system so that it works with our economy, not against it.

Walter Ewing
Immigration Policy Center (immigrationpolicy.org)

In purely economic terms, illegal immigration is harmful because it floods our 21st-century economy with 19th-century-style low-skilled workers.

Almost 60 percent of adult illegal immigrants lack a high school education. That's more than nine times the rate among native-born Americans.

This has three consequences. First, it means big costs for taxpayers. Workers with little education don't earn much money, so they pay little in taxes and use a lot of government services.

For example, half of Mexican immigrant families use at least one welfare program. It's not a question of laziness; it's just that the average high school dropout cannot support a family in a modern society like ours without government assistance, no matter how many jobs he or she has.

The second problem is that it reduces the wages of low-skilled Americans. As we flood the market for entry-level jobseekers, they lose the ability to demand higher salaries. Research shows that illegal immigration has cut the earnings of poor Americans by 7 percent, and even forced some out of the job market.

Finally, by keeping wages lower, illegal immigration takes away much of the incentive to invest in labor-saving technologies that make workers more productive, thus slowing the innovation that's needed for continued economic vitality and competitiveness.

What worked for our country 100 years ago is no longer helpful. Cutting illegal immigration levels is vital to ensure broad-based economic prosperity in the future.

Mark Krikorian
Center for Immigration Studies (cis.org)