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DETERMINING THE ECONOMIC IMPACT
OF INTERNATIONAL MIGRATION AND IMMIGRATION
IN THE UNITED STATES

Lydio F. Tomasi*
Center for Migration Studies of New York

This is a summary of the presentation at a workshop on immigration, which examined the economic impact
of the newest immigrants, at The Moral Dimensions of Poverty Conference, October 16, 1999. The complete paper is available through the Vincentian Center.
Lydio F. Tomasi, C.S. ordained a priest in the Missionaries of St. Charles/Scalabrinians, serves as the Executive Director for the Center for Migration Studies of New York and is the editor of International Migration Review and Migration World Magazine. He has licentiates in Philosophy and Theology from the Pontifical Gregorian University in Rome and earned his Ph.D. in Sociology from New York University.

The debate is still on regarding the economic impact of the newest newcomers on unskilled native workers. The harsh exchange between George J. Borjas, Professor of Economics at Harvard's Kennedy School and the author of the new book, Heaven's Door and Jagdish Bhagwati, Professor of Economics at Columbia University who recently reviewed Heaven's Door in The Wall Street Journal (9/28/99) is one example. Each of these professors claims that the facts are on his side.

It would be nice to provide a single and incontrovertible answer to the seemingly clear-cut question: What are the economic impacts of approximately 50 million migrant workers (i.e., those migrants in the 15 to 64 age group of about 100 million international migrants), who move from developing nations to industrialized democracies? Can the United States, for instance, "afford" so many immigrants? By admitting immigrants is the U.S. "importing poverty" (Hartnagel, 1999)? No clear-cut answer to the question of the economic impact of immigration on the host country can be derived from the available literature. While politicians and public opinion makers tend to see migration inflows as mainly causing difficulties to the native economy, much economic literature does not seem to support this attitude. Economic analysis suggests the likelihood of desirable effects particularly in relation to the problems generated by an aging society (Ichimo, 1993).

This paper has three goals:

1. to synthesize the state of the art knowledge about immigration as an economic factor internationally; (It is very difficult to generalize about a complex and changing phenomenon, so the reader must beware of oversimplification and over generalization.)

2. to review major recent research findings concerning the United States in order to provide a deeper appreciation of the toward and untoward economic effects of immigration to the U.S.;

3. to share the author's conclusions, that on the whole, immigration has marginal economic effects which are more positive than negative. Further, the author agrees with Bhagwati that a defining principle of American identity and one characteristic of American exceptionalism is that we are a nation of immigrants.

Even when we are inclined to surrender in times of distress to mean impulses, moving to close "heaven's door" or to serve our own economic ends in narrow (and often counterproductive) ways, Americans never seem to lose their innate empathy for the immigrants who seek to join them.

Migration as an Economic Factor Internationally

Migration is the most important international phenomenon that is not coordinated by an economically oriented international organization. Yet it is one of the most striking aspects of an intensive globalization of the world economy. Borders are increasingly open to market forces and are being penetrated much more effectively by goods, services and investment, as well as by people (Stalker, 1994). Immigration must be understood in its global context and as something "inextricably bound up with economic and foreign policy, development, international trade and growing interdependence as well as something often deliberately organized by employers and governments" (Castles/Miller, 1993).

What seems clear is that immigration has extremely unequal effects on different social strata. Some groups clearly gain from policies facilitating large-scale expansion of foreign labor migration while other groups (the migrants themselves, blue collar and minority workers) lose. In general, one also notices a bifurcation in the labor market effects of immigration upon industrial democracies. Immigrant workforces are increasingly bipolar with clustering at the upper [professionals/technicians (highly invisible migrants)] and lower levels of the labor market.

Contexualizing the topic of the international migration in a discussion of poverty, some argue that the conflict between labor and capital is no longer the major social issue in advanced societies. It has been replaced by the problem of exclusion. Many immigrant groups have been forced into this situation of exclusion and are doubly disadvantaged. They are not only amongst the excluded of post modern society—economically maginalized through low status, insecure work, poor education, living in urban and suburban ghettos, but they have also come to be widely seen as the cause of the problems. This "exclusion" may be a new name for "racism."

Research on the Effect of Immigrants on the U.S. Economy

For the U.S., some studies argue that immigrants always have been, and will continue to be, good for our economy. Other studies warn that, unlike in earlier times, immigrants arriving today have and will continue to have adverse effects on our economy and "undermine the very concept of nationhood," "our way of life." Empirical data is used to support opposite positions. The results of the studies vary because their authors' choices of data sources and methodologies. Analyses of the fiscal impacts of immigration cannot be separated from the social effects and must focus on real life immigrants. The way to proceed is to examine migration in a framework as dynamic as the phenomenon itself giving attention to group processes associated with the history and contexts of reception and of the national cohorts to which immigrants belong. Twenty-six million immigrants and their millions of children, who are U.S. citizens, will mostly stay. Their successes or failures in sorting out the challenges of a complex society and finding viable economic niches will determine the real long-term consequences of immigration.

Conclusions

In a discussion of the moral dimension of poverty, the following conclusions can be drawn from the research reviewed. The evidence suggests that immigrants expand total output and the demand for labor, offsetting the negative effects that a greater labor supply might have. Immigrants tend to be highly productive and promote capital formation through high savings rates. They fill vital niches at the ends of the skill spectrum, doing low-skill jobs that native Americans rebuff as well as sophisticated highskill jobs where demand is high. They add the vitality that a young new population can bring to a country and in the long term bring economic benefits. They also bring to us in the United States a responsibility to redouble our efforts on behalf of America's underprivileged, and especially its minorities faced with socio-economic exclusion. One of the great challenges facing the United States in the 21st century is jobs for its unskilled and lesser skilled workers. Full employment remains the most fundamental economic and social objective for our society. International migration should be regulated with a view toward the labor market. Democratic governments, and particularly the United States, should do much more to ensure comprehensive regulation of international migration. Better protection of immigrants and their rights, as the United Nations and the International Labor Organization have advocated, would have a way of reducing the tensions that creep into analysis of immigration and its economic effects.

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