Visa Crunch

Immigrants Well-Positioned To Benefit From The United States Economic Rebound

While much remains unknown, economic indices in the United States appear to be improving following the Covid-19 pandemic’s disruption. The unemployment rate in the United States declined from 14.4% in April 2020 to 5.7 percent in July 2021. Immigrants first lost jobs at a far higher rate than native-born workers, but their unemployment rate has now fallen below that of native-born workers. Although, the aggregate number of employed immigrants has plummeted.

According to a new Migration Policy Institute (MPI) issue brief, immigrants are not well-positioned to benefit from the United States’ economic rebound.

“As the country looks ahead to the post-pandemic recovery, immigrants are at a labor market disadvantage relative to the US-born population because of the regions where they live and the industries in which they work,” Migration Policy Institute researchers Randy Capps, Jeanne Batalova, and Julia Gelatt wrote in the brief.

The brief, Immigrants’ US Labor Market Disadvantage in the Covid-19 Economy: The Role of Geography and Industries of Employment, examines the extent to which immigrant employment has recovered, with a focus on differences in employment patterns across U.S. regions and major industries, based on an analysis of US Census Bureau data.

During the periods surveyed, the number of employed immigrants fell faster than the number of US-born people, owing in part to border closures, visa processing delays, and other immigration restrictions. When comparing the identical May–July months in 2019 and 2021, immigrants accounted for 28 percent of the 5.2 million reductions in employed workers in 2019.

Immigrant employment dropped the highest in the Pacific and Middle Atlantic, as well as in businesses like hospitality and construction, which are still reeling from the pandemic. Immigrant employment, on the other hand, increased in the East, and West, South-Central subregions, as well as in smaller cities and rural areas. And businesses with lower foreign worker populations, such as public administration and health care, appear to be recovering faster.

“If these economic trends continue, they are likely to lead to greater geographic dispersal of the immigrant population away from the traditional gateway cities. Many of the smaller urban and rural areas that currently have relatively strong economies also have stable or declining populations—and potential unmet labor market needs,” the authors concluded in the brief.

Longer-term, larger demographic patterns suggest that continuous immigration will be critical for US employment development once the country has recovered from the pandemic’s economic effects. Demand for foreign-born employees should be robust, with the total number of working-age immigrants fewer than before the epidemic and US population growth slowing due to low birth rates.

During the pandemic, pressures to prevent person-to-person interaction may have pushed the replacement of workers with technology in a number of industries. Other industries, such as leisure/hospitality and retail commerce, may be impacted by shifting customer behavior, such as if more individuals continue to work from home and patronize businesses closer to their homes rather than in downtown areas.

Immigrant workers’ ability to adjust to changing labor demand may necessitate educational and training efforts to enable them to migrate into higher-skilled positions that are more resistant to recessions and automation.

Simultaneously, boosting credential recognition of internationally earned degrees and talents will help eliminate skill underutilization among millions of college-educated immigrants, allowing American communities to better benefit from their human capital.

Changes in where immigrants live and the occupations they do may occur as a result of shifting labor market demand. Reforms to the legal immigration system in the United States that take into consideration these economic and demographic trends would help build the groundwork for strong future economic growth.

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