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  /  News   /  Brett Arends’s ROI: U.S. government quietly hikes illegal immigration projections by 175%. What does that mean for workers?

Brett Arends’s ROI: U.S. government quietly hikes illegal immigration projections by 175%. What does that mean for workers?

Bad news for entry-level workers and the wages of the working poor, but good news for corporate profits, inflation and Social Security: The federal government has just drastically hiked the number of illegal immigrants it expects to let in to America over the next 10 years.

Net immigration of “foreign-born people without legal status” into the U.S. is projected to average 220,000 a year over the next decade, the Congressional Budget Office has just revealed.

That’s a remarkable 175% hike from the average of just 80,000 a year the CBO had forecast a mere 6 months ago.

The figure is unannounced in any press release, but appears instead in the third sentence of the fourth paragraph of the fifth page of the CBO’s latest report on America’s “Demographic Outlook: 2023 to 2053.”

The CBO press office confirmed the rise in an email to MarketWatch. “This is correct,” a spokesperson wrote. They added: “In CBO’s assessment, the easing of pandemic-related travel restrictions and improved visa-processing capabilities boosted net immigration by 600,000 people in 2022 relative to last year’s projected amount, largely because of increased net immigration of foreign-born people without legal status.” (Emphasis added.)

The Congressional Budget Office is the independent department that conducts research, analysis and long-term forecasts on behalf of both branches of Congress. “Foreign-born people without legal status” is their term for what the Social Security Administration calls “other-than-lawful” immigration, the media and academy call “undocumented” immigration, and some others still call “illegal” immigration.

How this number has jumped by nearly 200% as a result of changes in federal law, and federal government processing capabilities, remains unclear.

Julia Gelatt, senior policy analyst at the Migration Policy Institute, an independent think-tank, says the figures represent a big leap from the recent past. “To put this in context a little bit, according to the estimates that we use at the Migration Policy Institute, net growth in the unauthorized immigrant population was less than 100,000 per year between 2011-2019,” she says, adding that 2019 “is our most recent estimate, at the moment, given data limitations.” Other organizations that track the figures, she says, estimate that “the unauthorized immigrant population was actually shrinking over this same period.”

Meanwhile an analyst at the Center for Immigration Studies, a think-tank that is critical of unlawful immigration, says the real figures are likely to be even higher. “It doesn’t really surprise me,” says CIS senior fellow Art Arthur of the latest forecast. “If anything, I think the numbers are probably pretty low (compared to reality), but they are a reflection of the extent of illegal immigration into the U.S. under the Biden administration and for the foreseeable future.”

Debates about unauthorized immigration are politically charged. But higher numbers are likely to be negative for the wages of lower-skilled and entry-level workers, through the economic laws of supply and demand. It increases the supply of those willing, able, or even desperate to work at almost any price. On the other hand, and for the same reason, the unheralded jump in the numbers of immigrants “without legal status” is likely to be a net positive for U.S. consumer prices, corporate profits, and stock prices, for the same reason. It will drive down costs for labor.

U.S. consumers and investors have benefited since the 1980s from the twin strategy of sending U.S. jobs to emerging markets (through offshoring) and bringing emerging markets to U.S. jobs (through unlawful immigration).

The boost in unlawful immigration is also likely to be slightly positive for the beleaguered Social Security trust fund, as immigrants without legal status often pay into Social Security but don’t get to claim benefits when they retire.

Hiking immigration—legal and illegal—is a public policy tool to help America deal with the so-called demographic time bomb. People are living much longer, drastically raising the expected number of senior citizens over coming decades. Meanwhile fertility has collapsed, lowering the number of expected domestic-born workers. Americans have been having too few children to maintain the population since 2008.

“Over the next decade, immigration accounts for about three-quarters of the overall increase in the size of the population,” the CBO says. “After 2033, population growth is increasingly driven by net immigration, which accounts for all population growth beginning in 2042.”

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