We Need to Immigrants to Thrive

Migration patterns favor a dynamic, growing Colorado economy

My new son-in-law was born in the U.S. shortly after his parents emigrated from India to work in aerospace. My wife’s mom emigrated from Paraguay in the 1950s after her brother was recruited by the U.S. oil industry. The first American Binnings was a ship captain from London who arrived around the Civil War.

Our nation, more than any other in modern history, is made of immigrants. Foreign-born U.S. residents represent 13.5 percent of the U.S. population. About half are naturalized citizens and about one-quarter are unauthorized. Twenty percent of Americans are either first- or second-generation immigrants, and 25 percent of all children under the age of 18 have at least one immigrant parent.

A 2011 study by the American Psychological Association found first generation immigrants have better physical and behavioral health as well as some better educational outcomes. Unfortunately, the study also found health and educational outcomes decline in subsequent generations as immigrants become “Americanized.”

In Colorado, only 10 percent of residents are foreign immigrants. Immigration, however, is still important to Colorado. Like the nation, 42 percent of all people 25 and over who moved from a foreign country to Colorado from 2011 to 2015 have a college or graduate degree. Not all the recent foreign movers are immigrants — some could be military personnel returning home to a place such as El Paso County, where 1.3 percent of its total population moved from abroad in the prior year and only 2 percent moved from another Colorado county. This global mobility, by definition, promotes new perspectives, which can lead to innovation and at least a greater appreciation for who we are.

Intuitively, one would think migrants are risk-takers, as they are pulled to leave home by opportunity. Often, rather than being pulled to a new land of opportunity, immigrants are pushed out to escape famine, war or persecution. While any move involves risk, the perceived risk of moving could be far less than staying, regardless of whether the impetus is pull or push.

Foreign immigration policies and social networks that can help facilitate migration can highly influence the decision to move. Research through the Small Business Administration shows immigrants form businesses at over twice the rate as non-immigrants, and exports are a higher proportion of their sales. Conversely, sales and hired employees are lower in immigrant businesses. 

The research consensus finds immigration’s addition to the supply of U.S. labor typically creates negative impacts only in the short-term and in regions with a preponderance of low-skilled labor when the immigrants are also low-skilled. The group whose wages are most negatively impacted in the short-term are other recent immigrants to the U.S.

Moving through time, immigration has a substantial positive impact on wages, labor markets and the overall economy. There are positive impacts on public and private capital investment to maintain productivity levels, government budgets as immigrants are more likely to be net payors into government coffers, and innovation as immigrants are often more entrepreneurial or educated. Today, immigrants are providing new, younger talent to America at a time when the baby boomer generation is retiring and becoming a net cost to our nation.

While Colorado is home to relatively fewer foreign immigrants, the state more than makes up for it with interstate in-migration. Nationally, only 27 percent of all people were born in a different state than that of their current residence. In Colorado, 46 percent of residents come from other states. Given migration patterns — whereby 35 percent of U.S. in-migrants into Colorado are from the Midwest, 28 percent are from the West, 23 percent are from the South and 14 percent are from the Northeast — it appears closer geography promotes migration. This is also true internationally; migration, like trade, is more often a regional phenomenon. Colorado benefits greatly from interstate movers as they are more educated than other groups on average.

If we apply the same research findings from foreign immigration to interstate in-migrants to Colorado, it’s clear that migration patterns favor a dynamic, growing Colorado economy. The same research leads me to ask whether some of the economic problems in America stem from many displaced workers in stagnant economic areas not moving. Instead, they retrain, depart the labor force, or take multiple lower-paying jobs while waiting for the market and/or government to respond with economic development in their home area. In the end, economic success appears substantially driven by migration. Let us not forget this as we attempt to recraft our economies for the future. We also should remember that at some point in our history, most of our ancestors were immigrants.

Categories: Economy/Politics