How immigrations make it, past and today

The opinion of Princeton economist Leah Boustan

….the pattern whereby the kids of poor and working-class immigrants do better than their American counterparts, is true both today and in the past. The children of poor Irish or Italian immigrant parents outperformed the children of poor US-born parents in the early 20th century; the same is true of the children of immigrants today.

In the past: We are able to delve into the reasons for this immigrant advantage in the past in great detail, and we find that the single most important factor is geography. Immigrants tended to settle in dynamic cities that provided opportunities both for themselves and for their kids. So, in the past, this meant avoiding Southern states, which were primarily agricultural and cotton-growing at the time, and – outside of the South – moving to cities more than to rural areas. If you think about it, it makes sense: immigrants have already left home, often in pursuit of economic opportunity, so once they move to the US they are more willing to go where the opportunities are.

Today:  Geography still matters a lot today, but not as much as in the past. Instead, we suspect that educational differences between groups matter today. Think about a Chinese or Indian immigrant who doesn’t earn very much, say working in a restaurant or a hotel or in childcare. In some cases, the immigrant him or herself arrived in the US with an education – even a college degree – but has a hard time finding work in their chosen profession. Despite the fact that these immigrant families do not have many financial resources, they can pass along educational advantages to their children.
From Noah Smith substack blog

Here is my posting on the remarkable upward mobility of children of poor Asian mothers.

Children do better than their parents. Here.

STEM workers are increasingly immigrants



Between 2000 and 2019, the overall number of STEM workers in the United States increased by 44.5 percent, from 7.5 million to 10.8 million. 40% of this increase were immigrants. As of 2019, there were 2.5 million immigrant STEM workers, 23% of the total, up from 16% in 2000.

Immigrants from India accounted for 29 percent, or 725,000 of all foreign-born STEM workers in 2019. In that year there were 2.7 million Indians in the U.S, of whom 80% or 2.16 million were of working age. This means that 33% of Indian workers in the U.S. were STEM workers. By comparison, about 6% of all workers are STEM workers.



See here and here.



Congressional Budget Office growth of labor force entirely due to immigration through mid century

The CBO issued in July an outlook for the U.S. population through 2052. Here are some highlights:

Very little annual increase: The population increases from 335 million in 2022 to 369 million in 2052, an average 0.3% increase.

Fewer workers relative to old people: The number of people ages 25 to 54 to the number of people over 65 falls from 2.3 to 1 in 2022 to 1.7 to 1 and 2052.

Below replacement fertility rate:  before the 2008 recession, the rate as 2.02, below 2.1 replacement rate. In the future it will be 1.75.

Virtually flat workforce: the 25 – 54 population will grow from about 130 million to 135 million.

Immigration adds one million people per year. From other sources, the average age of recent immigrants in 30 vs the average age of Americans at 38.  This implies that immigrants may at 500,000 or more new workers per year, as the native born workforce declines.

The CBO report implies that without immigration the 25-54 year old population (prime working years) will decline by about 300,000 a year. With immigration, this population increases by about 200,000 a year.

Digital Nomad Program in Greece.

Greece Digital Nomad (Type D) Visa was introduced in September 2021.  Length of Stay is 12 months, extendable for a year. Processing time is 19 working days, the visa fee is 75 Euros.

Minimum requirements include: Cannot be a citizen of an EU country. Proof of monthly income no less than €3500 per month. Evidence of employment working for clients outside Greece.  A declaration letter stating that he/she won’t work for a company registered in Greece and justify remote work status with relevant documents and details. Proof of health insurance and evidence of good health. A return flight ticket.

Go here and here (for a more general intro to digital nomads).

What if you want to work remotely from in Costa Rica?

A “digital nomad” is some one working remotely who, instead of, say, working in Park City, CA for her company headquartered in Philadelphia, decides to work remotely out of another country. The Migration Policy Institute reports how some countries are incorporating digital nomads into their temporary visa programs. Most countries appear to do this as a nuance to tourist visas.

There are companies (such as here) which are in the business of arranging for temporary work locations outside the U.S.

Examples:

Costa Rica: A short term visa for remote workers or service providers foreign nationals who are employed by a company outside Costa Rica or provide services to entities outside Costa Rica. A one year visa, with option to extend for one additional year. Proof of monthly income of at least $3,000 for an individual or $4,000 for applicant independence.

Greece: A digital nomad visa for foreign nationals who are self-employed or employed by a company outside Greece. Up to one year, with option to renew for up to three years. Proof of monthly income of €3500.

The report concludes: There is a strong case for government to introduce more flexibility into their immigration policies for all categories of remote workers. Policymakers should consider taking a more permissive stance toward occasional remote work by foreign workers unemployment visas as this becomes a more common feature of the labor market

Big role of U.S. in global work and study migration

The international migrant share of the world’s population is rising, standing at 3.6 percent in 2020, up from 3.2 percent a decade earlier, and 2.6 percent in 1960. (from the Migration Policy Institute, here).

The United States has 4% of the world’s population but 17% of all workers outside their country and 16% of all students outside their country.

The United States is the world’s top migrant destination: The country accounts for 5 percent of the global population but has attracted 18 percent of all migrants. The United States has more global migrants (more than 50.6 million as of 2020) than the next four receiving countries—Germany, Saudi Arabia, Russia, and the United Kingdom—combined (50.2 million).

The number of international migrant workers stood at 169 million in 2019, or nearly 5 percent of the global workforce. The U.S. is host to about 29 million of them, or 17%

Close to 6.1 million students were studying outside their country of origin in 2019, up from 4.8 million in 2015 and 2 million in 2000. In that year, 1 million or 16% were in the United States. The top five destinations for international students were the United States, Australia, the United Kingdom, Germany, and the Russian Federation. The top five sending countries of international students in 2019 were China, India, Vietnam, Germany, and France.

A farm worker immigration bill?

The House is reportedly close to agreement on passing a new temporary farm worker bill. Here are some background facts, some drawn from earlier postings.

International migraiton of farm workers boomed in the 2010s in response to demand for workers. (Go here.)  The U.S. is just one of many countries importing workers.

The majority of the 1.25 million hired farm workers today are foreign born. A tiny share are naturalized citizens, 20% are green-card holders, 10% are H-2A workers, and 50% are unauthorized. (Go here and  here.) This shows that any serious attempt to increase legal farm worker immigration needs to replace unauthorized with legal workers.

H2-A farm workers are paid on average about $14 per hour. This is roughly similar to the average wage of a worker without a high school degree. in California and Washington, farm wages (all workers) were over $17. (Go here.)

The existing primary temporary farm worker visa, H-2A, was created in 1952. The H-2A workforce grew between 2010 and 2021 from 50,000 to 250,000. The leading states in which they work are California, Florida, Georgia, North Carolina, and Washington. (Go here and here.)

The last 30 years showed a sharp rise, and more gradual decline in the number of unauthorized farm workers, and a rise in the number of citizen and green card workers. (Go here.)

In 2017, half of corporate farmers reported a shortage of labor, less than 5% were using H-2A. This is due in part to employer objection so the processing and other burdens of the program. (Go here.)

Go here for an extensive amount of info about farm employment. Also go here.


One million talented immigration program

 

Graham Allison, professor of government at the Harvard Kennedy School, and Eric Schmidt is a former CEO and executive chairman of Google, describe a strategy to import many talented technical workers.  One of their arguments I’ve posted on – the reality that our artificial intelligence workforce is heavily immigrant-based.

Here are a few passages from their article In Foreign Policy

To leverage the United States’ greatest advantage, Biden should immediately announce a commitment to recruit 1 million of the world’s most technically talented individuals by the end of his first term in January 2025. To this end, the U.S. Congress should streamline the country’s immigration rules and establish programs to recruit and retain established tech superstars and the world’s best students researching advanced technologies. And if Congress will not act, then Biden should use his ample executive authority to create a million talents program and promote the United States’ leadership in the technology of the future.

…..

China naturalizes fewer than 100 citizens each year, while the United States naturalizes nearly 1 million people annually. Barriers to China competing in this arena include an insular culture, engrained habits of being unwelcoming to foreigners, and a difficult-to-learn language spoken by few people outside of China.

……

Washington should grant an additional 250,000 green cards each year. The current backlog of green cards—which entitle their holders to permanent residency and unrestricted work—is well over 1 million for high-skilled immigrants and is projected to grow to nearly 2.5 million by 2030. Right now, the U.S. government is hopelessly behind, approving two applications for every green card it actually issues.

…..

Next, the United States should recruit more geniuses. Granting 100,000 additional visas each year to extraordinary tech talents would go a long way toward strengthening the U.S. technology workforce.

….

The United States can also boost retention of tech talent by granting immediate permanent residency to every foreign-born doctoral graduate in the STEM subjects. The majority of recent graduates from AI Ph.D. programs in the United States who left the country have cited the cumbersome immigration process as a critical factor in their decision to leave.

 

Academic studies of negative effects of immigration

In “A Compendium of Recent Academic Work Showing Negative Impacts of Immigration,” the Center for Immigration Studies summarizes 32 research articles with address some negative effect of immigration.

I see two major features of this compendium. First, the most studied issue is a negative impact on native born persons with low formal education / low skills by immigration of people suitable for the same jobs.

Second, a key issue of immigration impact is completely missing: the impact of increased immigration on social and political tension. This issue has been acknowledged even by researchers who are pro-immigration, such as Robert Putnam (here).

Low skilled native born workers lose out: “This review paper is similar in content to the National Academies’ chapters, but it takes a more international perspective. After considering over 50 studies of immigration in developed countries, the author concludes that “immigration can create winners and losers among the native-born workers.” Because low-skill immigration tends to make low-skill natives the “losers” and high-skill natives the “winners”, rising inequality is a natural consequence.” (From here.) 

Restrictions lead to more mobility: “1920s immigration restrictions benefited rural Americans who migrated into cities to replace lost labor. In contrast, farmers mechanized rather than attempting to recruit new workers.” (From here.)

Farm mechanization: Some articles on the positive effect of reduced immigration on farm mechanization, and visa-versa. CIS addressed this in its own 2007 report, here.

Impact of refugee influx: “Resettling refugees may be a humanitarian good, but the argument that refugees are somehow an economic boon to their host nations is dubious. This paper reviews the evidence that refugees struggle to integrate into the economies of high-income host nations. In the U.S. specifically, refugees perform unusually well in finding jobs. However, in line with their counterparts in other rich nations, U.S. refugees earn low wages even after 10 years of residency. (From here.)

The economics of smuggling people into the U.S.

I’ve found at long last an informative overview of smuggling of Central Americans into the U.S. The Wall Street Journal reported, drawing largely from a November 2021 study which I cite at the end.

Persons in El Salvador, Guatamala and Honduras who have entered the U.S. within the past five years report that 15% migrated to the U.S. legally, 22% irregular without a smuggler, and 55% with a smuggler.

Among the migrants using a smuggler it took two attempts to make it to the destination country. Those who traveled through regular migration channels including temporary tourist and employment visas, many overstayed their visas.

Guatemalan migrants are most likely to rely on smugglers 78% — compared to Salvadorians 64% and Hondurans 25%

The average smuggling cost is $7,500. Compare that with wages in the U.S. of dishwashers about $14/hr or $25,000 annually, and for a landscaping laborer $17/hr or $30,000. The average wage in Guatemala City is annually $6,000. Adjusted for purchasing power, that annual wage is $9,700.

This means that a Guatemalan worker by coming to the U.S. and earning $30,000, after tax and other wage deductions of 30%, can by keeping expenses low afford to remit $300 a month while building up cash savings.

It could take between 9 and 11 months for Central Americans to pay the full expenses of migrating irregularly with a smuggler and between five and eight months to pay the expenses associated with regular migration. For those who did not make it to the United States or who are repatriated to the countries of origin, paying back loans and expenses present an even greater challenge.

The percentage of households that reported a member of migrating recently to the United States: El Salvador 15% Guatemala 12% Honduras 12%.

29% of households reported regularly receiving remittances from abroad. In Guatemala it was a monthly amount of $350 while in Honduras and El Salvador it was 170 and $150, respectively.

There is an overwhelming demand for employment opportunities outside the countries. Violence, insecurity and natural disasters have been complex and launch it standing triggers of migration, but economic factors for where participants’ primary motivation for emigrating.

I have posted on the American basin of foreign labor. I have posted here on the real wage gains for a low formally educated person coming to the U.S.

Here is the primary source of information: Charting a new regional course of action: the complex motivations and cost of central American migration. Co-authored by Migration Policy Institute, World Food Program, and Civic Data Design Lab, November 2021