Immigrantsand its effect on the economy were among one of the most controversial debateissues that were discussed by economists and politicians for years. Regardingon the world’s regions, Northern America was the region with the highest degreeof immigration (Kirk, 2016). In fact, California hosted the greatest number ofimmigrants, accommodating over 10 million settlers, which were approximately27.
3 percent of the entire population (“Immigrants in California”,2017). Immigration played a very significant role in benefiting the economy byreducing labor shortage and generating new businesses, which could lead tofurther innovations.Firstly,immigrants benefit the economy by reducing labor shortage since they fulfilledthe gap in labor which results in a notable increase in production andAmerica’s Growth Domestic Product, or GDP. Labor shortage was among everycountries’ greatest concerns for it could cause a huge impact on the economyand the country’s income. Even though America was a country that held numerousnumbers of immigrants, but they still lacked workers in many fields like manufacturing,mining, and construction. Due to this reason, labor was extremely needed inorder to meet the needs of employers.
In fact, employers in different skills oflabor market searched for more labor supplies to fulfill the demands of theircustomers because more labor could result in an increase in production, whichwould bring massive profits to the company itself. Lookingfrom the perspective of native-born workers, some might disagree with the factthat more immigrants were entering their country since they might think thatthese peoples would compete with them when it comes to finding jobs, despitethe fact that native workers and immigrants did not have to compete for thesame jobs because “both possessed a different level of skills and qualities,so they tend to seek for different types of jobs” (Kugler & Oakford,2013). A study from the National Bureau of Economic Research, or the NBER addedimmigrants and native workers approached different areas of jobs due todifferent levels of language, education, and experience (Varas, 2017). In fact,most immigrants appeared to have lower education than natives, who might havereceived some high school education. Meanwhile, immigrants who were bilingualmight suits certain jobs than natives who could only speak English. HowardChang (2016), a law professor at the University of Pennsylvania also supportedthat immigrants were imperfect substitutes for native workers.
For instance,most newcomer immigrants tend to have problems with English, which couldrestrict them from having access to certain jobs in the states. However, theseimmigrants have kept many industries alive since there were still multiple jobsthat did not require highly skilled workers. Specifically, the study proved a 1percent increase in the employment of immigrants could lead to a 0.5 percentincrease in income per worker (as cited in Migrating to Opportunity,2017).
As a matter of fact, theimmigrant’s main intention in coming to America was to find job opportunities,so they tend to accept jobs that most native would refuse to consider (M.Orozco, C. Orozco, & Hillard, 2001, p.72). Additionally, as immigrantsentered the labor market, they indirectly increased native worker’s income.
Aresearch founded that as immigrants enter the labor industry, native-bornreacted to this shifts in the workforce by aiming for higher skilled jobs, andhigher skilled occupation certainly means an increased amount of their income(Kugler & Oakford, 2013). Immigrationpromoted growth and employment opportunities by increasing the populationnumber in the states. An increase in population raised the consumption level,as well as the expanding the production and demand, bringing more investment(Varas, 2017). Besides, these essentials had helped boost the country’s GDP.Immigrants had added $1.6 trillion to America’s GDP in 2013 (Estrada, 2016) andwere expected to reach $24.6 trillion within 2030 (Groeger, 2017). Immigrationreduced the need for labor along with creating new businesses.
Immigrationreduced the need for labor along with forming new businesses.Secondly,immigrants promoted the economy by creating new businesses, promoting moreemployment and further innovations. Most immigrants were more likely to starttheir own business than native-born. There were 17% entrepreneurs in the UnitedStates that were immigrants (Fairlie 2008). Latest data also confirmed thatbusiness owned by immigrants had generated over $776 billion in incomes andemployed approximately 4.7 million employees in 2007. Plus, immigrants did not only create newbusiness, but they provided tons of jobs for Americans as well.
For instance,Npubar Afeyan, an immigrant from Lebanon, was the CEO of Flagship Ventures, acompany which founded 38 companies and owned more than 100 franchise (Furman& Gray, 2012). In fact, there were many successful founders who wereimmigrants like Jyoti Bansal, the founder of AppDynamics, and Paul Orfalea, thefounder of Kinkos. Immigrantsare innovators. They played an important role in several high skill professions.
For example, immigrants represented 61% of hardware engineers, 50% of physicalscientists, 43% of computer programmers, 39% of accountants and mechanicalengineers (Reese, 2017). These immigrant inventors should not be underestimatedsince they were the main strength that led the country to a better innovation.Lyndon B. Johnson (1965), the 36th President of the United States, quoted that,”the land flourished because it was fed from so many sources- because itwas nourished by so many cultures and traditions and peoples.” Without theseimmigrants, further innovations would be impossible. It was not only theeconomy itself that received the benefits, but including the people living inAmerica. Gordon Hanson (2012), a professor of economics at the University ofCalifornia, mentioned about the recognizable progress American household thatthe increased in production, that was due to increasing number of immigrants,had boosted the population’s living standard (p.
26, para.1). Immigrantslessened the need for labor and creating new businesses, bringing trillions ofprofits to the country.
Inconclusion, immigration had elevated the country’s economy by providing laborforces, increasing productivity and the country’s GDP. Variation in skills ofimmigrants fulfilled shortage in many areas of work. It also generated morebusinesses, boosting the employment rate in the country and bringinghigh-skilled people which helped promote further innovations.
These essentialshad strengthened the economy, leading America to prosperity.