Skilled Immigrants Help Boost Our Economy

Learn more about Laura Collins.
Laura Collins
Director, Bush Institute-SMU Economic Growth Initiative
George W. Bush Institute

Immigration reform that tilts the balance in favor of immigrants with skills or advanced degrees has the potential to boost economic growth.

On April 7, 2017, the United States Citizenship and Immigration Service (USCIS) announced that the FY 2018 H-1B visa cap season had closed. Open for only four days, this was the fifth year in a row that the H-1B visa cap was exhausted in less than a week.

Last week, I noted how the rapidity with which these visas are exhausted is an indication that the supply is far too low to meet the needs of the market. Firms are unable to find the talent they need for open positions. While this is a very important consideration in the immigration reform debate, it ignores the broader positive economic implications of highly-skilled immigrants and temporary workers.

Later this spring, the Bush Institute will release the third edition of our handbook on immigration facts. In a policy debate dominated by anecdotes and fond memories of Ellis Island, the handbook combines demographic and economic data to paint the picture of modern immigration to the U.S. So what does modern immigration look like?

The U.S. admits immigrants of all skill levels — from those with little formal education and few skills to those with advanced degrees. But over the last few years, the number of immigrants with at least a bachelor’s degree has increased.

According to the 2015 American Community Survey, around 17 percent of immigrants aged 25 or older held at least a bachelor’s degree. While this may sound low, only 19.4 percent of native born citizens in the same age group have at least a bachelor’s degree.

When it comes to advanced degrees, immigrants are beating native born Americans: 12.4 percent of immigrants earned a graduate or professional degree compared to only 11.4 percent of the native born.

Immigrants who have arrived more recently tend to have higher education and skill levels than their earlier counterparts. For immigrants arriving since 2010, more than one in four has a bachelor’s degree, and 19.8 percent have advanced degrees.

This is a dramatic increase from the previous decade, when only 12.5 percent held an advanced degree. This is an important development for economic growth as highly skilled workers tend to have higher productivity and thus a bigger economic impact.

Many economists agree that immigrants are good for the economy. Higher levels of immigration can create jobs for America workers, increase the rate of GDP growth, and decrease the deficit. Immigrants are more entrepreneurial and more innovative than native born American workers. They are typically young and pay more in taxes than they use in entitlement benefits, even at lower incomes.

Our current immigration system admits more people based on family reunification than on skills or merit. Immigration reform that tilts the balance in favor of immigrants with skills or advanced degrees has the potential to boost economic growth and jolt the economy out of the tepid growth of the post-Great Recession recovery.