NEW YORK CITY - As the number of migrants reaching the U.S. borders continue to increase, the overall issue and its impact on different sectors of society -politically, culturally, economically- dominate the public conversation.
The latter one is among the most prevalent, with many actors of the economic landscape weighing in on whether increased immigration helps or hurts. Policymakers and researchers continuously analyze the issue, and a new study has placed itself on the helps category.
The analysis, conducted by The Hamilton Project and titled "New immigration estimates help make sense of the pace of the employment," argues that a spike in migration in recent years is what helps explain some of the surprising strength in the economy since 2022.
Although the study doesn't account or look at the latest wave of immigration -which in 2023 reached historic figures- it does show that the trend has had a positive impact on the labor force, and subsequently the economy.
When it comes to this demographic, the study looked at a variety of groups depending on their legal status -ranging from green card holders to complete newcomers- and analyzed their participation in the economy.
It also specifically highlighted how even those migrants who may not necessarily stay in the U.S. permanently, such as those holders of humanitarian parole, are still living in the area, and hence, participating in the economy and its growth.
Prior to the pandemic, the range of population and labor force participation projections from the Congressional Budget Office, the Bureau of Labor Statistic and the Social Security Administration suggested that sustainable employment growth would be between 60,000 and 140,000 additions per month. In 2023, however, employment growth averaged 255,000 per month.
The study also stresses that, while data on immigration remains increasingly difficult to keep up with in research, the project's time frame in relation to immigration shows that faster population and labor force growth has meant that employment could grow more quickly than previously believed without adding inflationary pressures.
Another effect that immigration surges can have on the economy relate to consumer spending. The study concludes that greater immigration has likely resulted in greater consumer spending growth, the strength of which has surprised observers.
As population shifts and growth becomes the norm across the U.S., particularly in relation to immigration, it is increasingly imperative to take these trends into account, the Hamilton Project suggests.
"Immigration will continue to be a substantial determinant of population and labor force growth going forward," the study reads, "and timely measurement of immigration flows is critical to understanding the U.S. economy."
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