Immigration is crucial to job growth in the U.S.
Friday, February 24, 2017
According to a Bloomberg Business report, job growth in the United States will stagnate without a surge of qualified immigrant workers. Economist John Herrmann noted that from the post-World War II boom years to 2007, the U.S. gross domestic product (GDP) grew at an inflation-adjusted 3.75 percent per year. Since 2007, and projected through 2029, GDP will expand at a less-than-robust 1.75 percent, which, in turn drastically reduces monthly employment gains.
Increasing the number of skilled immigrants into the U.S. job force is one way to reinvigorate the U.S. economy.
Decreased GDP is directly related to decreased productivity in the U.S. The reduction in U.S. productivity is not due to a lack of innovation or technology – on the contrary, it’s because many of the fastest growing sectors in the U.S., like technology and health care, are unable to find enough workers to keep pace with their growth needs. This creates stagnation in the sector because firms have to scale back expansion efforts due to lack of workers.
Where job growth had steadily averaged in excess of 100,000 per month between the late 1940s and 2007, the U.S. economy is projected to average 75,000 or fewer new jobs per month over the next decade. With an increased available workforce, however, firms will be able to expand and create jobs at a much brisker pace. Statistics show that U.S.-born college graduates already are unable to keep pace with demand in the STEM sectors, with the U.S. government projecting a shortfall of almost one million by 2020.
The best solution to increase the number of jobs created in the U.S. and to boost GDP over the near term is to encourage greater immigration of skilled workers. We’ve already seen this starting to happen, as Chinese and Indian immigrants have overtaken Mexicans and other Latin Americans as the largest incoming immigrant groups. But even at today’s levels, there will continue to be an employment shortfall in the fastest-growing sectors of the U.S. economy.
Broad immigration reform is required to keep the American economic engine running efficiently. Without it, the U.S. economy could languish to an extent where we are no longer competitive in the global market for the brightest and most-skilled of the world’s workers.