Month: October 2023

The race for artificial intelligence talent

The October 30, 2023 White House “Executive Order on the Safe, Secure, and Trustworthy Development and Use of Artificial Intelligence” includes Section 5: a 774 word instruction for enhancing our immigration systems to provide more AI talent. I am digesting it now.

In 2021 I posted on AI talent: “The United States has a large lead over all other countries in top-tier AI research, with nearly 60% of top-tier researchers working for American universities and companies. The US lead is built on attracting international talent, with more than two-thirds of the top-tier AI researchers working in the United States having received undergraduate degrees in other countries.”

 

How the big 1965 and 1986 immigration bills are enacted 

For the 1965 Immigration and Nationality Act: Dem Rep. Emmanuel Celler chaired the House Judiciary Committee which held hearings on immigration reform in the early 1960s. President Kennedy had proposed immigration reform and eliminating the national-origin quotas in 1963. The Senate Immigration Subcommittee and House Immigration Subcommittee reviewed immigration policies in Congressional hearings during the early 1960s.  Attorney General Robert Kennedy convened a panel of experts in 1964 to review immigration policies which helped build momentum for reform.

The Senate voted 76 – 18 and the House voted 326 – 69. It was signed by President Johnson on October 3, 1965

For the 1986 Immigration Reform and Control Act: The Select Commission on Immigration and Refugee Policy, a bipartisan task force created in 1982 chaired by Rev. Theodore Hesburgh (16 members – 4 from the House, 4 from the Senate, and 8 from the general public ). The commission released a report with recommendations including employer sanctions, legalization of certain unauthorized immigrants, and increases in immigration enforcement.

The report helped shape the debate and lay the groundwork for the Immigration Reform and Control Act of 1986. Several of the major provisions in the 1986 law mirrored the Select Commission’s recommendations.

The Senate voted 69 – 30 and the House voted 230 – 166. It was signed by President Reagan on November 6, 1986.

 

Foriegn born workers trends, 2010 – 2030

The growth rate of the foreign born employment has recovered from the pandemic and is about 3.5% annually vs. 0.6% annual growth for the U.S. born employment. The percentage of workers who are foreign born, based on these rates, is expected to grow from 16% in 2010 to 23% in 2030:

Why? First, the labor force participation rate of foreign born workers is higher at all levels of education:

Now, take into account not only first generation but second generation immigrants. Immigrants and their U.S. born children were responsible for 85% of the labor force growth between 2010 in 2018 at which point they comprised 28% of all workers [17% foreign born, 11% children of foreign born– PFR], up from 25% in 2010. And projection suggestions to 2035, all growth in the working age population will come from immigrant origin adults. (Go here.)

First and second generation workers are more concentrated in prime working age (25 – 54) – 70% vs. 62% for all other workers.

 

 

 

China fertility rate plummets

The Wall Street Journal reports that China’s total fertility rate fell to 1.09 last year, from 1.30 in 2020. I wrote in 2022 on China’s “doomed demographics.”  In 2016, when China scrapped its one-child policy, 18 million births were recorded. In 2022 the figure fell below 10 million.

The fertility rate of India is now 2.0.

Are foreign born workers driving down labor force participation?

The Center for Immigration Studies asserts that the decline in labor force participation in the U.S. is in part a result of foreign-born labor, particularly at the lower part of the job market with respect to formal education.

CIS Executive Director Camarota says that “Using large-scale illegal immigration to fill jobs may please employers, but it allows policymakers to ignore the decades-long decline in labor force participation that contributes to profound social problems, from crime and drug overdoses, to welfare dependency and suicide.”

Here is a summary of the participation rate experiences of the U.S. and six other advanced countries. Some countries have aggressive pro-immigrant policies, such as Canada and Germany. One in particular, Japan, has a very small foreign-born workforce.

United States: Peaked at around 67% prior to the 2008 recession. As of 2021 it was around 62%, with declines driven by aging and health/disability reasons.

Canada: Labor force participation rate declined from around 67% in 2011 to around 65% in 2021. The drop is largely attributed to aging demographics.

Japan: Labor force participation has declined steadily from over 70% in the 1990s to under 63% in 2021. Japan has the oldest population which is a major factor.

Germany: Dropped from over 70% in the 1990s to under 68% in 2021. Driven by aging population, lower participation among women, and expanded welfare.

Italy: Fell from around 57% pre-2000 to under 56% in 2021. Aging population and poor economic growth play key roles.

France: Decreased from about 65% in 2003 to 64% in 2021. Aging demographics, unemployment, and increased school enrollment are contributors.

United Kingdom: Remained relatively steady around 63-64% over the past two decades. Less affected by aging than other European countries.

The labor force participation rate of Americans without a high school degree has been declining for 50 years, and I expect in all regions of the country, even those with small foreign-born workforces with little formal education.  This does not mean that foreign workers have not taken over jobs which U.S. born workers had done in the past – an example being meat processing plants. But it does mean that one has to look at the nuances of work, by industry and by region, to make sense of how foreign and U.S. born workforces interact.

The labor force participation rate for Americans without a high school degree: In the 1950s and 1960s, the labor force participation rate for this group was around 60-65%. It started declining in the 1970s and fell to around 55% by the 1980s. The decline accelerated in the 1990s, with the rate falling to around 45% by 2000. In the 2000s and 2010s, the rate continued to decline and reached around 30% by 2020.

One also needs to consider that the total number of U.S. born people without a high school degree has severely shrunk in the past few decades:  Between 1990 and 2020, the size of the U.S. born adult population over 25 without a high school degree declined by about 8.2 million (from 18.5 million to 10.3 million). As a percentage of the total U.S. born adult population over 25, this group declined from 13% in 1990 to 6% in 2020.

Help from Claude AI.

Temporary Protected Status

The Biden Administration has given temporary legal status to hundreds of thousands of persons through the use of the Temporary Protective Status program and through Humanitarian Parole. In this posting I address TPS. In 2019 there were about 400,000 persons covered by TPS. After action the Biden Administration in September, over a million will be covered. They will account for about 650,000 workers.

The Trump Administration attempted to terminate some authorizations but were frustrated by the courts. No immigration program since the passage of the 1986 has accelerated legal status in the U.S. more than TPS. It is, I believe, reasonable for a TPS benefiary to think that they have a very good chance of becoming a legal permanent resident.

(The best in depth reviews of TPS are here and here.)

Congress enacted the Temporary Protective Status program as part of the immigration act of 1990 to establish a uniform process and standard for granting temporary humanitarian protection in the United States, for non-citizens already in this country whose home countries are in crisis.  This provision was in part a response to a 1947 U.N. Protocol on refugees.

TPS designation can be for an initial period of anywhere from 16 to 18 months and extended indefinitely for periods for up to 18 months. The program is designed for people who cannot return safely due to their home countries due to ongoing armed conflict, environmental the disaster, or other extraordinary and temporary conditions. While the designation formally is temporary, the designation can lead to a more permanent status.

Nearly 93 percent of current TPS holders are from Latin American countries, particularly El Salvador, Haiti, and Venezuela, where a worsening humanitarian crisis has caused more than seven million people to flee the country. Hundreds of thousands of Salvadorans have been allowed to stay in the United States since devastating earthquakes rocked El Salvador in 2001. Haiti was first assigned TPS after a massive earthquake destroyed much of the country in 2010, and it received the designation again in 2021 and 2022 amid continued violence and a prolonged political crisis. Honduras and Nicaragua were given TPS after a hurricane battered the region in 1998. Countries that have previously received TPS include Angola, Bosnia and Herzegovina, Kuwait, Liberia, Rwanda, and Sierra Leone. (Go here).

In March 2019, some 400,000 citizens from 10 countries were covered by TPS, per the Congressional Research Service. As of March 2023, about 610,000 citizens of 16 countries have been granted TPS. In September 2023 the Biden Administration allowed 472,000 Venezuelans to be covered, adding to the some 250,000 Venezuelans already covered by TPS. Some arrived into the U.S. illegally, and they are prevented from moving to a more permanent status. Many have been here for years, integrating into the economy and raising children.

growth in interracial marriage, 1980 vs 2021

From Pew Resarch:

In 2020, 11% of all married couples in the U.S. were interracial or interethnic, according to Pew Research Center analysis. This is up from 3% in 1967 when the Supreme Court struck down bans on interracial marriage.

The most common interracial marriage pairing is one Hispanic and one white spouse at 42%. Census data collection changes between 2010 and 2020resulted in a tripling of persons who self-described a multi-racial, mainly involving this demographic.

Next is one white and one Asian spouse at 15%, then one white and one black spouse at 12%.

Interracial couples have increased across all education levels, but are most prevalent among couples where both partners have at least a bachelor’s degree.

Rates of interracial marriage vary widely by region. In Western states like Hawaii and Nevada, about 1 in 3 married couples are interracial. In Southern states, the rate is around 1 in 10.

About 20% of cohabiting couples were interracial in 2012. The interracial cohabitation rate has risen faster than the interracial marriage rate.

By 2050, Pew projects that 1 in 5 U.S. newlyweds will have a spouse of a different race or ethnicity. This indicates that interracial relationships will likely continue growing.

Remittances update

The World Bank wrote in June 2023 that global remittances in 2022 rose by 8% to $647 billion.  Due to the strong 2022 American economy, remittances to Mexico and Central American countries (which are almost entirely from the U.S) rose by more than 10%. Remittances to Latin America and the Caribbean are expected in 2024 to be $154 billion, double what they were in 2016.

The cost of sending a remittance remains high – 6% — vs a World Bank target of 3%.

Remittances to low and medium income countries are four times higher than official direct assistance and twice as that of direct investment. Back in the early 2000s, these flows were roughly equal.

Climate migration and Africa

What the International Monetary Fund calls “fragile and conflict-affected” states of Africa’s Sahel and neighboring countries (From Senegal to the Red Sea, and the band of countries below that) are going to be most adversely affected by climate change. These countries have very high fertility rates. Outmigration will remain very high.

Climate change-related migration can be hard to discern because the affected countries and sub-regions may have long standing seasonal migration and migration from rural areas into cities. I think that the Sahel will command much of our attention for the definite impact of a warming globe.

The IMF writes:

From the Central African Republic to Somalia and Sudan, fragile states suffer more from floods, droughts, storms and other climate-related shocks than other countries, when they have contributed the least to climate change. Each year, three times more people are affected by natural disasters in fragile states than in other countries. Disasters in fragile states displace more than twice the share of the population in other countries.

And temperatures in fragile states are already higher than in other countries because of their geographical location. By 2040, fragile states could face 61 days a year of temperatures above 35 degrees Celsius on average—four times more than other countries. Extreme heat, along with the more frequent extreme weather events that come with it, will endanger human health and hurt productivity and jobs in key sectors such as agriculture and construction.

Countries which are promoting inbound remittances

Several developing countries have made efforts to increase remittances from citizens residing abroad in more advanced economies. In summary, reducing transfer costs, providing financial incentives, embracing mobile services and targeted marketing to diaspora communities have helped many developing countries tap into remittances.

Here is a study of the costs of remittances. Here is a study of “diaspora bonds.”

India – Has taken steps to reduce costs and make transferring funds back to India easier. Remittances make up around 3% of GDP.

Mexico – Provides tax breaks and encourages migrants to open Mexican bank accounts that make remitting funds easier. Receives the most remittances worldwide at around $35 billion annually.

Philippines – Heavily markets bonds and other financial products to diaspora Filipinos to encourage remittances. Makes up over 10% of GDP.

Bangladesh – simplified rules for remittances and offered incentives. Remittances are around 7% of GDP.

Egypt – Allows expatriates to open foreign currency accounts and get higher interest rates to encourage transfers.

Pakistan – Gives diaspora Pakistanis foreign currency accounts and housing incentives if they remit dollars.

Nepal – Partnered with money transfer companies to reduce fees and make digital transfers accessible globally.

Somalia – Encouraged innovative mobile money transfer services that diaspora Somalis use extensively.

Ethiopia – Issued diaspora bonds and identity cards to encourage remittances, which are about 5% of GDP.

Sri Lanka – Gives preferential exchange rates and operates a welfare fund for migrants to encourage remittances.

Source: Claude

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