How immigration works for US?

Dallas Fed annual report has a nice chapter on this topic.

It says immigrants form almost 17% of the Us workforce. Foucs is on low skill immigrants but high skill ones have risen sharply bas well. They help fill critical jobs in science and IT sectors leading to overall gains for the economy.

It has some interesting stats. It comapres US workforce and immigrants since 1910:

The proportion of native-born individuals employed in blue-collar occupations today is less than half what it was in 1910, the historical peak of U.S. immigration (Chart 1). Among immigrants, who are disproportionately employed in blue-collar occupations, the fraction working in these jobs has fallen to 53 percent from 84 percent a century ago.These statistics highlight another important fact: Immigrants’ and natives’ skill levels differ more today than in 1910. The gap between the immigrant and native blue-collar employment share has grown to 16 percentage points, compared with 6 percentage points a century ago.

One of the most dramatic transformations of the U.S. workforce in the post-war years has been its rising educational attainment. In 1950, 64 percent of U.S.-born workers lacked a high school diploma. Today, fewer than 10 percent have not completed high school. This rapid rise in U.S. workers’ education levels created an opening for low-skilled foreign labor that was readily filled, both legally and illegally.

Low-skilled immigrants are increasingly employed in service jobs as well as disproportionately in the traditional industries: agriculture, construction and manufacturing. Service industries where low-skilled immigrants dominate include landscaping and building maintenance, food preparation, personal care and service, transportation and health care. All told, immigrants make up almost half of work-ers in the U.S. lacking a high school degree (Chart 2).

The immigrant shares among workers in the middle of the education distribution—those who graduated from high school or college—are much lower at 12 percent and 14 percent, respectively. For workers with master’s degrees, the foreign-born share rises to 16 percent; for those with professional degrees, such as doctors and lawyers, it is 17 percent; and among doctoral degree holders, the share reaches 27 percent.

Overall, 17 percent of workers age 25 and older were foreign born in 2009 (dotted line on Chart 2). Immigrants, thus, are concentrated at the bottom and top of the education distribution. Most U.S. workers are in the middle of the education distribution (Chart 3). Workers with at least a high school diploma but not a bachelor’s degree represent 57 percent of the workforce.

The education levels of highly educated immigrants has been rising which is a welcome trend.

It has an excellent discussion on how immgration effects economy, efficiency, fiscal policy etc. Here there is a balance as low skill immigration lead to costs but high skill ones lead to benefits. On net there is a gain for the US economy.

The author suggests US to open up its immigration policy and make it friendlier.

Immigration laws should be rewritten to focus on economic priorities. These include leveraging high-skilled immigration to build the nation’s human capital base, retain skilled jobs, foster research and development, and bolster competitiveness. These  payoffs will take years to occur but require making changes now. Other economic goals, such as making inflows more cyclical, can be readily achieved with a greater share of employment-based visas. Labor demand is naturally cyclical, and work-based immigration will decline in downturns and rise in expansions.

As global growth shifts increasingly to emerging markets, such as China and India, competition for skilled workers will only increase. The share of Chinese students educated abroad—most of them in the critical STEM fields—who return to China to work has doubled since 2001. Globalization and technological change already favor high-skilled workers, in a trend that goes back decades. Since the early 1970s, the inflation-adjusted wages of only the most highly educated U.S. workers have consistently risen. Bluecollar pay, particularly for men, has declined in real terms. The nature of economic growth has shifted from brawn and machines to brains and microchips. Immigration policy should reflect this change and be  a tool that helps secure the nation’s prosperity, now and in the future.

One Response to “How immigration works for US?”

  1. Training Diversity Says:

    Thanks for the great post!

    It often seems like the public has a very misconstrued image of what an immigrant worker actually is.

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