Figure 1: Foreign-Born Share of U.S. Population, 1850-2013 Show Source: U.S. Census Bureau. Has the surge in immigration since 1970 led to slower wage growth for native-born workers? Academic research does not provide much support for this claim. The evidence suggests that when immigration increases the supply of labor, firms increase investment to offset any reduction in capital per worker, thereby keeping average wages from falling over the long term. Moreover, immigrants are often imperfect substitutes for native-born workers in U.S. labor markets. That means they do not compete for the same jobs and put minimal downward pressure on natives’ wages. This might explain why competition from new immigrants has mostly affected earlier immigrants, who experienced significant reductions in wages from the surge in immigration. In contrast, studies find that immigration has actually raised average wages of native-born workers during the last few decades. Immigrants are at the forefront of innovation and ingenuity in the United States, accounting for a disproportionately high share of patent filings, science and technology graduates, and senior positions at top venture capital-funded firms. In addition, the presence of immigrants often creates opportunities for less-skilled native workers to become more specialized in their work, thereby increasing their productivity. Immigration generally also improves the government’s fiscal situation, as many immigrants pay more in taxes over a lifetime than they consume in government services. However, native-born residents of states with large concentrations of less-educated immigrants may face larger tax burdens, as these immigrants pay less in taxes and are more likely to send children to public schools. Labor Market Competition A popular view is that immigrants are taking jobs from American citizens. However, although immigrants increase the supply of labor, they also spend their wages on homes, food, TVs and other goods and services and expand domestic economic demand. This increased demand, in turn, generates more jobs to build those homes, make and sell food, and transport TVs. Most empirical studies indicate long-term benefits for natives’ employment and wages from immigration, although some studies suggest that these gains come at the cost of short-term losses from lower wages and higher unemployment.1 Standard economic theory implies that while higher labor supply from immigration may initially depress wages, over time firms increase investment to restore the amount of capital per worker, which then restores wages. Steady growth in the capital-labor ratio prevents workers’ average productivity, and therefore their average wages from declining over the long run. Figure 2 shows the pre-1980 trend in the capital-labor ratio extrapolated over the next few decades – the period when U.S. immigration accelerated. Consistent with the theory, the actual capital-labor ratio did not significantly or permanently deviate from that trend after 1980.2 Figure 2: U.S. Log Capital-Labor Ratio, 1948-2013 Log capital services per worker and trend, business sector. Table 1. Distribution of the Population 25 Years and Over by Educational Attainment, 2012 Percent
Source: Current Population Survey, Annual Social and Economic Supplement. Table 2. Estimates of the Long-Run Wage Impact of Immigration
Change in hours from Borjas (2014). Productivity Immigrants also bring a wave of talent and ingenuity, accounting for a disproportionate share of workers in the fields most closely tied with innovation. A 2011 survey of the top fifty venture capital funded companies found that half had at least one immigrant founder and three quarters had immigrants in top management or research positions.7 A significant share of advanced degrees awarded in science and engineering — often the foundation for innovation and job growth — go to foreign-born students with temporary visas studying in American universities. According to a 2012 National Science Board report, foreign students earned 27 percent of science and engineering master’s degrees in 2009.8 And in recent years, the number of foreign-born undergraduate students studying in American universities has grown rapidly, rising to 18 percent between 2011 and 2012.9 In 2011, 76 percent of patents from top 10 U.S. patent-producing universities had at least one foreign-born author.10 Indeed, immigrants produce patents at double the rate as natives, and the presence of these immigrants generates positive spillovers on patenting by natives.11 Economic theory suggests a direct link between a skilled and innovative labor force and faster GDP growth, and more than three quarters of U.S. growth over the last 150 years can be explained by improvements in education and research-driven innovation.12 Moreover, states with a high concentration of foreign-born workers experience significantly faster productivity growth.13 As discussed earlier, less-skilled natives often respond to increased competition from immigrants by leaving manual labor for occupations that emphasize language and communication skills. This greater specialization leads to a more efficient allocation of labor, raising the incomes and productivity of both natives and immigrants. Fiscal Impact Immigrants in general — whether documented or undocumented — are net positive contributors to the federal budget. However, the fiscal impact varies widely at the state and local levels and is contingent on the characteristics of the immigrant population — age, education, and skill level — living within each state. Figure 3 shows that immigrants, and especially recent arrivals, are generally of working age; thus, they impose relatively small costs on Social Security and Medicare — the largest components of federal non-defense spending. While immigrants’ taxes help pay for defense spending, they do not generate any additional significant costs for the military, thereby somewhat reducing the federal tax burden of the average native. Figure 3: Age Distribution of Natives and Non-Citizen Immigrants, 2012 Source: Current Population Survey, Annual Social and Economic Supplement. More often than not, immigrants are less educated and their incomes are lower at all ages than those of natives. As a result, immigrants pay less in federal, state, and local taxes and use federally-funded entitlement programs such as Medicaid, SNAP, and other benefits at higher rates than natives. But they are also less likely than comparably low income natives to receive public assistance. Moreover, when they do take public assistance, the average value of benefits received is below average, implying a smaller net cost to the federal government relative to a comparable low income native.14 However, immigrants often impose a heavier tax burden on natives at the state and local level. Immigrants — particularly those with low levels of education and income — generally have larger families and more children using public K-12 education, the largest component of state and local budgets. Furthermore, if immigrants’ children are not already fluent English speakers, the per-student cost of education may be substantially higher than for native-born children.15 These factors impose short-term costs on state budgets. Over the long term, however, the upward economic mobility and taxpaying lifetime of second generation immigrants more than offset the initial fiscal burden.16 Because the net cost to state and local governments is closely related to immigrants’ education and income, the socioeconomic composition of the immigrant population determines the fiscal impact in each state. For example, because New Jersey has a high proportion of well-educated and high income immigrants who contribute more to state and local revenues than they consume in public services, the net fiscal burden of immigration is small in New Jersey. In contrast, California’s high share of less-educated and low-income immigrants means that immigrants’ contribution to state and local revenues is smaller relative to their consumption of public services. As a result, the estimated fiscal burden of immigration is five times higher for native residents of California than of New Jersey.17 Conclusion Economists generally agree that the effects of immigration on the U.S. economy are broadly positive.18 Immigrants, whether high- or low-skilled, legal or illegal, are unlikely to replace native-born workers or reduce their wages over the long-term, though they may cause some short-term dislocations in labor markets. Indeed, the experience of the last few decades suggests that immigration may actually have significant long-term benefits for the native-born, pushing them into higher-paying occupations and raising the overall pace of innovation and productivity growth. Moreover, as baby boomers have begun moving into retirement in advanced economies around the world, immigration is helping to keep America comparatively young and reducing the burden of financing retirement benefits for a growing elderly population. While natives bear some upfront costs for the provision of public services to immigrants and their families, the evidence suggests a net positive return on the investment over the long term. Year,Percent of U.S. population 1850,9.7 1860,13.2 1870,14.4 1880,13.3 1890,14.8 1900,13.6 1910,14.7 1920,13.2 1930,11.6 1940,8.8 1950,6.9 1960,5.4 1970,4.7 1980,6.2 1990,7.9 2000,11.1 2010,12.9 2013,13.1 Year,Log capital-labor ratio,1948-1980 trend,Extrapolated 1948-80 trend 1948,4.18,4.21, 1949,4.24,4.23, 1950,4.26,4.26, 1951,4.28,4.28, 1952,4.31,4.3, 1953,4.32,4.33, 1954,4.37,4.35, 1955,4.37,4.37, 1956,4.38,4.4, 1957,4.42,4.42, 1958,4.48,4.44, 1959,4.47,4.47, 1960,4.49,4.49, 1961,4.52,4.52, 1962,4.54,4.54, 1963,4.56,4.56, 1964,4.58,4.59, 1965,4.59,4.61, 1966,4.62,4.63, 1967,4.66,4.66, 1968,4.68,4.68, 1969,4.7,4.71, 1970,4.74,4.73, 1971,4.78,4.75, 1972,4.79,4.78, 1973,4.8,4.8, 1974,4.84,4.82, 1975,4.9,4.85, 1976,4.9,4.87, 1977,4.9,4.9, 1978,4.88,4.92, 1979,4.9,4.94, 1980,4.94,4.97,4.97 1981,4.98,,4.99 1982,5.04,,5.01 1983,5.06,,5.04 1984,5.06,,5.06 1985,5.08,,5.09 1986,5.11,,5.11 1987,5.12,,5.13 1988,5.13,,5.16 1989,5.15,,5.18 1990,5.17,,5.2 1991,5.22,,5.23 1992,5.24,,5.25 1993,5.25,,5.27 1994,5.25,,5.3 1995,5.27,,5.32 1996,5.29,,5.35 1997,5.31,,5.37 1998,5.35,,5.39 1999,5.4,,5.42 2000,5.44,,5.44 2001,5.49,,5.46 2002,5.55,,5.49 2003,5.58,,5.51 2004,5.59,,5.54 2005,5.6,,5.56 2006,5.62,,5.58 2007,5.64,,5.61 2008,5.68,,5.63 2009,5.74,,5.65 2010,5.76,,5.68 2011,5.75,,5.7 2012,5.75,,5.73 2013,5.75,,5.75 ,Native,Non-Citizen 0 to 14,22.1,6.1 15 to 24,15,13 25 to 34,12,25 35 to 44,12,24 45 to 54,14,17 55 to 64,12,8 65 to 74,8,4 75 to 84,4,2 85 and over,2,1 How did immigrants contribute to the diversity of American culture?Immigrants, and especially the children and grandchildren of immigrants, have played a disproportionate role in the development of the American performing arts. They have also made fundamental contributions in many other realms of artistic, cultural, culinary, athletic, and scientific endeavor.
In what ways did immigrants assimilate to and change American culture?how did immigrants assimilate to and change American culture? they helped build railroads, joined political parties, and worked in factories. they brought new foods, culture, and beliefs.
How did immigrants adapt to the United States?They had to learn a new language and get used to new customs. This was all part of building a new life. Immigrant Neighborhoods Many immigrants moved into neighborhoods with others from the same country. In these neighborhoods, they could speak their native language and eat foods that reminded them of home.
What caused immigrants to assimilate?Immigrants migrate due to a variety of reasons, including political, socioeconomic and educational motives. Assimilation is an innate behavior caused by migration. Some Immigrants “choose” to migrate and willingly interact with the majority culture of their host nation (19).
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How did new immigrants to the united states assimilate in the face of increased cultural diversity?
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