Immigrants Make Big Contribution to U.S. Economy, Study Finds

Building on an earlier study of immigrants in New York State, the Fiscal Policy Institute (FPI) has released a new study that examines the economic contributions of immigrants in 25 major metropolitan areas across the country. FPI is a non-partisan think tank known for covering tax, budget, and economic issues in New York State.

The FPI study’s findings may be startling to some, and these are certain to be argued about as the immigration reform debate begins gathering momentum again. Far from being a drain on their local economies, immigrants contribute to the economy in direct proportion to their numbers – and, according to the FPI study, that contribution is significant. Immigrants comprise 20 percent of the population in the 25 largest metro areas of the United States, and their economic output in these areas is likewise 20 percent. (See Immigrants and the Economy: Contribution of Immigrant Workers to the Country’s 25 Largest Metropolitan Areas, Fiscal Policy Institute, December 2009. These large metro areas represent 42 percent of U.S. population, 66 percent of all immigrants here, and half of U.S. gross domestic product.

The FPI study also found that, between 1990 and 2006, “the metropolitan areas with the fastest economic growth were also the areas with the greatest increase in immigrant share of the labor force.” This is partly because immigrants cluster where the jobs are, according to the authors, in areas with robust economies. Arguably, the economic growth in these areas is itself driven by the energies and talents of these immigrant workers. Indeed, the FPI concludes that its findings fit into a “broad consensus” among economists, that “immigrants provide an overall boost to the economy,” and that “immigration has a positive or neutral effect on the large majority of workers.”

In a future study, FPI promised to research the extent to which immigration may negatively effect some U.S.-born workers – especially men without a high school diploma, and particularly African-American men. The authors note that, while the current study does not directly address this question, it does seek “to put it in perspective, showing the broad, constructive overall role immigrants are playing in the economy.” And that’s good news.