Trump is Wrong About Undocumented Workers

When discussing the effect of immigration on the economy, American workers, and social welfare programs, it's important to get our facts right. Unfortunately for Trump and his supporters, their anti-immigrant narrative fails to deliver.
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By Savannah Cantera and Abigail R Hall

Although the presidential election is still nearly a year away, candidates on both sides of the political aisle are already pushing their campaigns full speed ahead. One issue sure to define the election is immigration. And Donald Trump has gathered significant support from those who desire stricter immigration policies.

Those in favor of tougher immigration standards offer a variety of reasons. In particular, they claim that immigrants hurt the U.S. economy and push domestic workers out of the job market. Trump's campaign website, for example, states that undocumented immigrants have cost U.S. taxpayers billions in healthcare, housing and education.

While such arguments may be effective political rhetoric, these ideas are patently wrong. In fact, stricter immigration policy would harm not only the U.S. economy, but American workers as well.

Take, the claim by the Trump campaign that undocumented immigrants have had a "disastrous" effect on domestic jobseekers. The data finds the opposite. Giovanni Peri, an economist at the University of California, Davis, found that undocumented immigrants don't push domestic workers out of the market, but instead allow U.S. laborers to be more productive. How? U.S. workers, even those in relatively unskilled positions, have a more refined skillset than an average Mexican worker. These relatively unskilled foreign workers "take" the most basic jobs, but in so doing, they free up domestic workers to focus on more skilled projects. As a result of this effect, Peri found that from 1990 to 2007, undocumented workers increased legal workers' pay (native labor included) up to 10 percent.

Undocumented immigrants also create a massive number of jobs. Not only do they provide cheap labor and free up relatively skilled American workers for higher-paying jobs, but they also spend the money they make. Just as U.S. citizens purchase food, housing, and entertainment, so do undocumented workers. Their demand for goods and services creates ample business and other opportunities for domestic firms and workers.

Trump and his supporters claim undocumented immigrants are a drain on taxpayers. His campaign states that the cost of tax credits paid to undocumented immigrants totaled some $4.2 billion in 2011. In fact, undocumented immigrants contribute substantialy to the U.S tax base. Yes, even undocumented workers pay taxes. In 2011, the Institute for Taxation and Economic Policy released a study showing that undocumented immigrants paid $11.2 billion in state and local taxes in 2010 alone.

These results are well tested. In 2013, an OECD study of 28 separate countries found that documents and undocumented immigrants consistently add significantly more to the economy than they use in public services. The study found the average immigrant household in the U.S. made a positive annual contribution to the U.S. economy of about $11,000.

Even if the numbers presented by the Trump campaign are correct in terms of the use of public benefits by undocumented immigrants, the data suggests that their tax contributions more than offsets their use of social programs. The money these workers pay into the system provides funds that support everything from healthcare to public schools--for U.S. citizens. When it comes to Social Security, a program that continues to struggle as baby boomers age, undocumented immigrants have contributed up to $300 billion. That's more than the GDP of Denmark, and they will never see a dime of it.

There are still other costs to consider if Trump and his supporters were to have their tougher immigration policies. Consider the beef industry in Texas. According to Texas Comptroller Susan Combs, eliminating the undocumented workers would decrease Texas' labor force by 6.3 percent and their gross state product would decrease by 2.1 percent. This would not only decrease the number of workers available in Texas, but would likely drive up the price of beef, impacting grocery stores, restaurants, and other industries reliant on beef products. If you're an American who consumes one or more of 50 billion burgers eaten annually in the U.S., you might consider this effect.

Immigration is bound to continue to be a contentious issue this election cycle. When discussing the effect of immigration on the economy, American workers, and social welfare programs, it's important to get our facts right. Unfortunately for Trump and his supporters, their anti-immigrant narrative fails to deliver.

Savannah Cantera is a freshman at the University of Tampa majoring in International Business

Abigail R Hall is an Assistant Professor of Economics at the University of Tampa.

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