Immigration Boosts U.S. Economy, But Policy Reforms Needed to Maximize Benefits, Report Finds

A new report by the Economic Policy Institute (EPI) highlights the positive impact of immigration on the U.S. economy, emphasizing that immigration has been a key driver of growth and has the potential to contribute even more. However, the report also warns that the current U.S. immigration policies are preventing immigrants from fully participating in the labor market and granting too much power to employers, resulting in significant missed opportunities for both immigrants and U.S.-born workers.

According to the report, immigrants have become an increasingly important part of the U.S. labor force, particularly as the growth of the U.S.-born workforce has slowed dramatically. Without immigration, the prime-age workforce (ages 25-54) would have seen little to no growth over the past 25 years, severely limiting economic expansion and stifling industries that rely on immigrant labor. Immigration has also provided a deflationary effect in recent years, helping to lower inflation by balancing supply and demand, while also preventing a recession.

The report refutes common misconceptions that immigration reduces job opportunities for U.S.-born workers. Instead, it finds that immigrant workers complement U.S.-born workers, often working in roles that would otherwise remain unfilled, thereby promoting economic stability. Additionally, immigrants pay substantial taxes—nearly $100 billion annually—while drawing relatively fewer benefits compared to U.S.-born households, resulting in a positive net contribution to public finances.

However, the report also identifies critical areas in need of reform. Current immigration policies often place immigrant workers in precarious positions, allowing employers to exploit them by suppressing wages and neglecting basic labor protections. These practices harm both immigrant and U.S.-born workers in shared industries. EPI recommends stronger enforcement of labor standards, ensuring that all workers, regardless of immigration status, are treated fairly and receive equal rights and protections in the workplace.

Another key finding of the report is that housing shortages, not immigration, are driving up housing costs. The rapid rise in housing prices is largely due to the failure of U.S. housing markets to meet growing demand, rather than immigration itself. In fact, immigrants contribute to the housing sector by providing essential labor in construction, which helps address supply-side issues.

In conclusion, the EPI report underscores the need for comprehensive immigration reforms that grant immigrants full rights in the labor market and strengthen enforcement against exploitative employers. Such reforms would not only benefit immigrant workers but would also lead to higher wages, better working conditions, and a more robust economy for all Americans. The report calls for smarter policies that align with investment in infrastructure and innovation, unlocking even greater potential for immigration to drive long-term growth in the U.S. economy.