Immigration reform: An issue Congress cannot afford to overlook


Within the past month, House Majority Leader Eric Cantor’s (R-Va.) office imposed greater difficulty to immigration reform when it announced no debate would be allowed before the midterm elections. But the immigration issue isn’t one that should be eclipsed by other matters.

As our economic competitiveness continues to erode, Congress should take this issue much more seriously. Through conducting research for Becoming American: Why Immigration is Good for Our Nation’s Future, I realized the negative economic ramifications our current immigration policy inflicts on the United States. Namely, our policy does not allow employers the opportunity to utilize immigrants’ potential.

{mosads}Consider that in 2012, according to the Bureau of Labor Statistics, the unemployment rate for computer and math occupations was 3.5 percent. That same year, the number of H-1B visas administered to those with a higher education degree ran out in only 10 weeks. This clearly indicates our need for foreigners with certain skill sets to fill jobs at home.

By further delaying debate on immigration reform, we are inherently delaying companies’ abilities to hire those component people. Now, rather than outsourcing abroad for cheaper labor, companies, particularly technological firms, are establishing offices overseas to meet American demand.

As the U.S. fails to step up to the plate, other countries, such as Canada and Australia, are building centers of excellence because their policies attract and retain educated immigrants. Numbers don’t lie — while 35 percent of U.S. immigrants obtain high levels of education, that figure is over 46 percent in Canada. This can easily be explained by the differences in our immigration policies. For example, an H1-B visa only allows an immigrant temporary residence in the U.S.; though, in Canada, a temporary work permit is considered to be the first step in achieving permanent residence.

Yet these highly educated foreigners are exactly the people who can once again stimulate U.S. growth. More than 260 jobs are created for every 100 foreign students who receive an advanced STEM (science, technology, engineering or mathematics) degree in the United States. Furthermore, in 2012, immigrants had a hand in 42 percent of America’s Fortune 500 companies. Creating more than 10 million jobs, these companies have generated $4.5 trillion of annual revenue and represent about 30 percent of the U.S. GDP.

Immigrants, however, don’t just positively affect large-scale corporations, for they are also often the ones who form small business. In fact, immigrant-owned small business employed about 4.7 million people and generated $776 billion in receipts, as detailed by the Fiscal Policy Institute in 2007. In sum, immigrants represent 18 percent of America’s small-business owners, which is a disproportionate ration considering they make up only 13 percent of the U.S. population.

Though some contend immigrants impose a threat on our economy, this is a fallacy. With their purchasing power, taxes and ability to create jobs, immigrants are responsible for increasing the U.S. GDP by about $37 billion each year, as reported by the White House Council of Economic Advisers in 2007. Even those who pay lower taxes, such as the undocumented foreigners, have a positive impact on our economy. Their buying power alone allows for the sustainment of hundreds of thousands U.S. jobs.

For these reasons, all of Washington should welcome a debate on immigration reform. Immigrants, particularly those who are highly skilled, clearly posit positive benefits to our economy — and pushing them away is not something we can afford to do.

Ghadar is the William A. Schreyer Professor of Global Management Policies and the founding director of the Center for Global Business Studies at the Pennsylvania State University’s Smeal College of Business. He is also a distinguished scholar and senior adviser at the Center for Strategic and International Studies. He recently authored Becoming American: Why Immigration is Good for Our Nation’s Future. Follow him on Twitter @FGhadar

Tags Eric Cantor Immigration law Immigration reform STEM

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