Immigrants, both documented and undocumented, are a crucial source of labor, and it is well past time for immigration reform. Moreover, it needs to be framed in a way that addresses the reality of the situation rather than popular myths.
In addition to the important human aspect of the issue, there is also a clear economic incentive. Change is coming for the U.S. workforce, with the retiring of baby boomers and slower population growth, and long-term prosperity hinges on the ability to tap into the global workforce.
Part of the current situation relates to visas, where there have been calls to reduce numbers and make them harder to obtain. In some cases, visas allow in workers who fill jobs where qualified employees are hard to come by. For example, the H-1B program allows U.S. companies to temporarily employ foreign workers in occupations requiring highly specialized knowledge and a bachelor’s degree or higher.
A larger issue involves persons who would prefer permanent residence or even citizenship. The process can be difficult to navigate, requiring time, financial resources and often legal assistance. For many persons who are undocumented, there is not a viable path to legal status. Immigration reform which provides a mechanism for undocumented immigrants to achieve legal status could provide substantial economic benefits ranging from a larger pool of potential workers to additional tax receipts.
The importance of the undocumented workforce illustrates the need for reform. In a recent study, we found that the number of undocumented workers in Texas is much larger than the total number of unemployed persons in the workforce. In other words, even if all currently unemployed persons filled jobs now held by undocumented workers, the state would be left with a glaring gap of hundreds of thousands of jobs if the undocumented workforce were no longer available.
We looked at the costs and benefits of the undocumented workforce and the results were clear. The net direct economic benefits of undocumented workers in Texas were found to include $144.7 billion in output (gross product) each year as well as 1.2 million jobs. There are multiplier (ripple) effects on top of the direct benefits, and when those are considered, total net economic benefits rise to an estimated $290.3 billion in output (gross product) each year and 3.3 million jobs.
Certain industries are particularly in need of workers and rely on undocumented individuals, including the agriculture, hospitality, and construction sectors. The current situation, with the Gulf Coast recovering from the devastation of Hurricane Harvey, illustrates the importance of the immigrant workforce.
Our analysis indicates that there are more than 250,000 undocumented construction workers in Texas, with roughly one-third of them in the Houston area. Many of these workers are highly skilled; they represent about 30 percent of the state’s construction labor force, with no replacements readily available. Given that construction crews travel to needed areas, Houston and the Gulf Coast could easily face a shortage of 100,000-150,000 or more workers for the efforts to rebuild homes, businesses and infrastructure without this pool.
In recent years, the pace of immigration has slowed. While the Great Recession may have played a role, there are also factors such as post-9/11 regulations, efforts to secure borders, and improved conditions in other nations (such as Mexico) in relation to the United States.
Without a steady supply of immigrant workers, however, the United States may face significant labor force challenges. In addition to the important social considerations, immigration reform that both protects borders and the integrity of the system and confronts economic reality is essential to long-term economic prosperity.