The immigrants have contributed to the American economy as investors, workers, owners of businesses, consumers and entrepreneurs. Studies have indicated that on a whole immigrants account for around 45% of the work force of the country, 32% of engineers and scientists and 30% of high tech employees. Now United States is the largest home of the immigrant population around the world. The immigrants have been major assets in the American economy and have significantly contributed to the whole economic output of the nation (Hainmueller, Jens, and Daniel J. Hopkins). For instance, in 2013, the immigrants have contributed $1.6 trillion to the entire GDP of U.S. The scholars have also indicated that the immigrant labor has complemented so much, that it has added to the increase of the standard of living of the general population in America. This essay will critically discuss the impact of the immigrants on the American economy.
It can be found that most of the influential entrepreneurs of the United States are immigrants, or sometimes the children of immigrants. This fact is most profound in the technological industry, where most of the entrepreneurs initially belonged to some other country. For instance, the founder of Google, Sergey Brin, is originally belonged to Soviet Union who fled from there around forty years ago; the founder of Yahoo, Jerry Yang also emigrated from Taiwan at the age of ten; the CEO of Microsoft Satya Nadella also emigrated from India. Recent studies have shown that around forty percent of the companies that have started within 2010 or included in the Fortune 500 list were either founded or led by the immigrants and their children (Dustmann, Christian, Tommaso Frattini, and Ian P. Preston). This does not only include the small organizations, but also the biggest organizations such as Apple, AT&T, also the older organizations such as General Electric, McDonalds and Bank of America. These organizations are a remarkable part of the national economy of U.S. They have not only generated around $1.7 trillion of U.S dollars in the revenue, but also employed around 3.6 million citizens of America only in the year 2010. Apart from the major contributions in the large companies, the immigrants have also made a strong impact as the small entrepreneurs. The immigrants contribute around 28% of the small business in U.S and tend to become entrepreneurs twice more than the native population. A recent study has shown that the small business founded by the immigrants generate around $700 billion in the sales and pay more than $125 billion in the payroll taxes. On an average each of the small businesses employs around eight staffs that together provide around four million jobs to the general American population.
Therefore the immigrants have given America a financial edge in the global economy. They are seen to bring more pioneering ideas and an entrepreneurial spirit to the national economy. In fact, immigrants also help to provide the business contracts to the foreign markets that enhance the capability of trade of America and investment for further benefits in the international economy (Fairlie, Robert W., and Magnus Lofstrom). Several scholars propose that the immigrants contribute to keep the economy more flexible, which eventually help the investors of America to keep the general process down thus meet more consumer demands. Studies have shown that immigrants have always delivered a major positive growth to the American economy. Therefore the country has always been benefitted enormously from the huge immigration throughout the past decades.
There is a popular view about the continuous immigration is that; the immigrants are capturing all the jobs that were for the Native Americans. However, under this popular myth the view is always lost that even though the immigrants contribute to increase the labor supply in a significant way, they also spend wages on food, home and other necessary products and services, thus expanding the domestic financial demand. This trend not only increased the demand, it has generated more employment opportunities such as making and selling foods, supplying necessary products etc. most of the empirical studies have indicated that generally the long term benefits for the employment of the native Americans come from the immigrants, even that costs some of the short term losses such as lower wages. The Standard Economic Theory states that while there is higher labor supply, it may depress the wages initially; however over time the firms will increase their investments for restoring the investments they make per worker, therefore this will further reinstate the wages. The stable development in the capital labor ratio will help to prevent the average productivity of the workers. However, it is also found in the recent studies that immigrants do not generally push the native citizens out of their own jobs; rather they tend to fill the jobs that cannot be filled by the Americans (Kerr, William). These jobs are generally at the low and high ends of the spectrum of skills. Immigrants not only fill the high end jobs in the expert fields, they also tend to occupy the low skilled jobs such as domestic services, construction sites, restaurants etc. Furthermore, the involvements of the immigrants are more obvious in the high technological jobs and the academic fields. The high technology sectors such as Silicon Valley will be doomed if the borders are closed for the high educated and skilled immigrants. They entirely represent skilled human capital that will make the whole economy more dynamic.
Immigrants do not act as the drain of the government finances. Recent studies have found out that a general immigrant in America and her or his child will pay more than $80,000 in the tax during their entire lifetime other than collecting the government services. However, for the immigrants with any college degrees, this net fiscal return will become $198,000. However, it is a true fact that the refugees and the low skilled immigrants have a tendency to use government welfare more than the native households in America, but the Welfare Reform Act 1996 had made the procedure a lot difficult for the immigrants who come to collect the welfare. As a result to that the overall welfare rolls have changed a lot. Therefore, it can be said, immigrants are not entirely without the negative effects, but they have mostly contributed positively in the American economy.
Reference List and Bibliography
Chang, Grace. Disposable domestics: Immigrant women workers in the global economy. Haymarket Books, 2016.
Dustmann, Christian, Tommaso Frattini, and Ian P. Preston. "The effect of immigration along the distribution of wages." The Review of Economic Studies 80.1 (2013): 145-173.
Fairlie, Robert W., and Magnus Lofstrom. "Immigration and entrepreneurship." (2015).
Hainmueller, Jens, and Daniel J. Hopkins. "The hidden American immigration consensus: A conjoint analysis of attitudes toward immigrants." American Journal of Political Science 59.3 (2015): 529-548.
Kerr, William R. US high-skilled immigration, innovation, and entrepreneurship: Empirical approaches and evidence. No. w19377. National Bureau of Economic Research, 2013.
Lakoff, George, and Sam Ferguson. "The framing of immigration." (2017).
Lebergott, Stanley. The American Economy: Income, Wealth and Want. Princeton University Press, 2015.
Ngai, Mae M. Impossible subjects: Illegal aliens and the making of modern America. Princeton University Press, 2014.