ANOTHER LOOK AT AMERICAN ENTERPRISE INSTITUTE REPORT: Immigration and American Jobs

Back in December 2011, we linked to the newly released American Enterprise Institute report on Immigration and American Jobs. I think it is worth looking back on that report to note the extremely compelling case that the AEI makes for increased levels of immigration of highly skilled workers to the United States. I am constantly referring to this report, especially in light of the continuing difficulty that all of my business clients experience in dealings with the U.S. Citizenship and Immigration Service. The field adjudication officers of the USCIS seem to maintain a “zero-sum” perspective on the relation between the immigration of foreign workers and the employment of U.S. workers. USCIS practices have a chilling effect on job creation and economic growth.

What the AEI report provides empirical evidence that the entry of highly skilled foreign workers to the U.S. actually creates additional jobs for U.S. workers.

The AEI report shows as follows:

1. Immigrants with advanced degrees boost employment for US natives. This effect is most dramatic for immigrants with advanced degrees from US universities working in science, technology, engineering, and mathematics (STEM) fields. The data comparing employment among the fifty states and the District of Columbia show that from 2000 to 2007, an additional 100 foreign-born workers in STEM

fields with advanced degrees from US universities is associated with an additional 262 jobs among US natives.

2. Temporary foreign workers—both skilled and less skilled—boost US employment. The data show that states with greater numbers of temporary workers in the H-1B program for skilled workers and H-2B program for less-skilled nonagricultural workers had higher employment among US natives. Specifically:

• Adding 100 H-1B workers results in an additional 183 jobs among US natives.

• Adding 100 H-2B workers results in an additional 464 jobs for US natives.

3. The analysis yields no evidence that foreignborn workers, taken in the aggregate, hurt US employment.

4. Highly educated immigrants pay far more in taxes than they receive in benefits. In 2009, the average foreign-born adult with an advanced degree paid over $22,500 in federal, state, and Federal Insurance Contributions Act (FICA, or

Social Security and Medicare) taxes, while their families received benefits one-tenth that size through government transfer programs like cash welfare, unemployment benefits, and Medicaid.

On the basis of these findings, the AEI made the following recommendations for improvements in immigration policy:

The results here point directly to several policy proposals that would boost US employment. These policies would require neither new taxes nor new spending cuts. Specifically, policymakers could create jobs by doing the following:

• Giving priority to workers who earn advanced degrees from US universities, especially those who work in STEM fields.

• Increasing the number of green cards (permanent visas) for highly educated workers

• Making available more temporary visas for both skilled and less-skilled workers.

We think that this AEI report is extremely valuable. It should provide guidance and empirical evidence to policy makers charged with forming immigration policy. It clearly shows that for the foreseeable future, skilled foreign workers will be vital to economic growth in the U.S.