Immigration to the USA

The topic of immigration has been in the forefront of public interest lately, with stories ranging from domestic hate crimes [link], vetting of overseas passengers [link], swifter deportations [link], sanctuary city resistance [link], stark-naked aliens in Times Square, and the new Administration now targeting to machete migrants by ½.  This article only seeks to address some of the data in the final point here, which is the level of immigrant aspirants in the United States.  It also helps to ask what does it mean to be an American, and what are the values we hope to share with the world?  It should be noted that this is not a research article that covers all the relevant nuances of the issue, but rather some very specific statistical data that is worth highlighting.  We lay out these factoids through four topics below.  And hope they become a baseline on your own understanding of immigration data.

 

 

Topic 1: the immigration rate into the U.S. has edged down over past decade

Per the OECD, foreign migration flow has edged down from the high 3% of the population in 2005, to the low 3% rate in their most recent couple years.  Non-OECD estimates have the migration rate even lower, in the 2% range.  Even at 2%, we have population growth of just over 1%, implying without high-earning immigraants the country would organically contract in population and further slow GDP. 

So now we must agree among ourselves if we feel such a level is too high, or too low, or just about right.  It shouldn’t matter as much how we stack up against other countries (but will get to that in a moment anyway).  A cogent person might conclude that it would be great to accept new migrants, to the degree that their skills would be in demand and jointly do not jeopardize the current economic opportunities for the domestic-born citizens. 

A healthy level wouldn’t be 0%, nor would it be, say 100%.  We don’t do enough in this country to measure to right economic data to make such an analysis straightforward.  However, it is widely known that the economic catastrophe (I worked on the TARP rescue plan) from the recent financial crisis has led many Americans feeling as if their own opportunities are being taken by someone born overseas. 

There may be some truth to this, but probably a good helping of neurosis as well.  There is also a self-selection bias, where many talented people are choosing not to come to the U.S. in the first place if the opportunities generally don’t make sense.  After all it’s hard to be in a uniquely rising boat, if the overall tide is falling.

Looking at much of the available economic and statistical data, it seems as if the immigrant pool should be reduced (no issues with this in principle), but to then cut it in ½ seems overly draconian.  We should aim to fill the most well sought-after, well-paying, and coveted roles first by Americans (including minorities and women) as well, and not simply bypass them by exploiting foreign talent.  Also, remember that as a country of immigrants, it is the unpredictable stars among our new citizens who create business empires, innovate, and lead our economy. 

Topic 2: what is the unemployment rate of foreigners?

The questions of long-run employability of any migrant and their families can be gauged from their unemployment rate.  Here we break up the data between men and women.  Each gender has a different bias in their reason for coming (e.g., business, humanitarian, family, free movement, etc.)  See the table below.

 

This unemployment data, and others in our time series, provide a generally favorable picture.  The foreigners who have migrated here tend to have usable skills, and are employable beyond any specific position.  The much better than average unemployment rate for men could be a competitive disadvantage to natives, or in small measure it could partially reflect different education and career fields they are working in.  The story is significantly different for immigrant women, some of whom may be coming to be a spouse.

Topic 3: where do our foreign-born migrants come from?

This chart below is self-explanatory.  Mexico accounts for 1 in 7 immigrants, or having blossomed to equal to that from China and India combined!  Another 5% from Philippines; and another 5% from Cuba.  We leave it to you to decide whether the occupations generally associated with these countries are unhelpful to advancing the U.S., or if they are then is it at the right level.  The world changes, and our own needs change over time.  And so too we should be elastic in our adoption of new frameworks to thinking about policy relative to history.  Some people are coming from places that add much greater value, and with much lower domestic competition or number of qualified native applicants.

 

Topic 4: reporting inconsistencies across the globe

We often see incoherent comparisons of the U.S. immigration rates versus that of other countries.  This is for the most part immaterial, as the U.S. has very few peer comparisons, culturally and economically.  To make matters shoddier, per a OECD technical report [link], the reported data often overestimates the amount of immigration going to other countries, based on non-harmonized accounting definitions relative to the U.S.

Over-estimates that can be in the 50%-60% zone, even for advanced nations such as Germany, Japan, and United Kingdom.  Another message from statistical examination is to be careful of sampling errors, peer comparisons, and who provides you your news!

 

 

 

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