Consumer prices in the United States rose 7.7 percent in October, the ninth straight month of more than seven percent, due to increased demand and supply. All eyes are on the US Federal Reserve to calm demand by raising interest rates. But monetary policy always works with long-term and changing horizons, which makes the Fed’s task of trying to regulate the country’s 122.4 million households, 164.5 million workers, and 35.1 million businesses even more daunting.
There is more that US policymakers can do to fight inflation, however. They can expand immigration for skilled and skilled workers to increase the strength of the American economy. More migration will help meet the demand for regular labor, which over time will limit wages and raise prices. In October, there were 10.3 million job openings in the United States, 4.3 million more than the number of unemployed Americans. In the short term, expanding the number of H-1B visas for skilled workers and H-2B visas for seasonal non-agricultural workers will help employers overcome this labor shortage. In the long run, doing so will also help curb inflation.
THE GREAT IMMIGRATION SLOWDOWN
Despite the sensational headlines about the unrest at the US-Mexico border, immigration to the US has been flat over the past decade. Between 2011 and 2021, the share of the U.S. population that was born abroad declined slightly, from 13. On the same subject : Democrats lobby for high-tech immigration reforms in the Innovation Act before Congress.0 percent to 13.6 percent, reflecting a significant decline in foreign labor. While the average immigration to the United States was 890,000 arrivals per year in the first decade of the century, the number dropped by almost half to 480,000 per year in the following decade.
The decline in immigration is due in part to the recession that began in 2007 and the slow recovery that followed, which deterred some foreign workers from coming to the United States. But America’s immigration policy has also made it difficult for immigrants seeking to enter the country. Before the outbreak of COVID-19, the United States cracked down on illegal immigration but stopped issuing temporary work visas. Because each new group of temporary visa holders replaces the previous group, and because the U.S. economy is growing every year, the continued supply of visas is a recipe for a smaller native workforce.
In 2019, the United States issued about the same number of H-1B and H-2B visas as it did a decade ago. The same is true of J-1 visas for sponsored foreign nationals, many of whom work at American universities or research facilities. The only visa type that has grown significantly since 2010 is the H-2A, which allows temporary entry for agricultural workers. Following the outbreak of COVID-19, all of these programs were temporarily suspended as US embassies around the world suspended most consular operations. Today, most US embassies are slowly resuming their visa processing efforts, but the office staff is still not at the level of the outbreak.
The rapid decline in immigration has made it difficult for the US labor market to function properly. In addition to compensating for the long-term decline in U.S. fertility, foreign-born workers have the advantage of being more mobile than native-born workers. When productivity increases in one region or decreases in another, foreign-born workers are the first to respond, helping to reduce regional imbalances in labor supply. America. Without these workers, the American economy could find itself in a bind, just as it was during the crisis.
The US hospitality industry is an example. In 2019, 22.0 percent of job holders in entertainment, lodging, and food services were foreign born. The outbreak has been particularly difficult for businesses in these sectors, making it difficult for them to find workers. And because the supply of American visas has come to a standstill, these businessmen have not been able to rely on immigrants to fill their positions. By the end of 2021, the share of entertainment, lodging, and food service workers who are foreign-born has dropped to 18.4 percent — a drop of more than 3.5 percentage points. Currently, the number of job vacancies in the hospitality industry has increased significantly; in October 2022, 9.2 percent of lodging and food service jobs are vacant, higher than the overall economy of 6.3 percent.
WHERE ARE THE WORKERS?
Expanding the H-2B visa program, which allows temporary employment of non-agricultural foreign workers for up to nine months, would be an obvious solution to this problem. See the article : Wheels Up: ‘Steady Pickup’ at Q2 Corp. Travel. Common jobs for H-2B visa holders include restaurant worker, butcher, and construction worker – the exact jobs that American companies are aiming to hire and find it difficult to hire American workers.
Yet Congress has set a cap of only 66,000 H-2B visas per year — a tiny fraction of the current 1.8 million job openings in construction and food service alone. For fiscal year 2021, an additional 22,000 visas have been issued to US workers who want to ensure that no US workers are “prepared, skilled, or able” to do the jobs they want to fill. But with millions more jobs sitting vacant than unemployed Americans, this one-time bonus was a drop in the bucket. The biggest increase, like ten times the current one, should be allowed for 2023.
Increasing the number of H-2B visas will not hinder US-born workers. According to research by economists Michael Clemens and Ethan Lewis, companies that win the H-2B visa lottery and hire foreign workers tend to increase the number of American workers they hire—and grow their revenues. . In other words, foreign workers on H-2B visas complement, rather than replace, American-born workers in low-skilled jobs. This finding is consistent with a larger study showing that immigrant workers have the least impact on the wages of native-born workers.
Why not reward every graduate with a visa?
The U.S. should also expand the H-1B visa program, which allows U.S. companies to provide new jobs to educated foreigners for three to six years. Currently, the United States has set the number of new private sector visas at 85,000 – 65,000 for workers with a bachelor’s degree or more than 20,000 for workers with at least a master’s degree. For years, demand for H-1B visas has outstripped supply. In fiscal year 2022, 308,613 people applied for H-1B visas before the US government stopped accepting applications.
The tight cap on H-1B visas restricts not only the supply of American labor but also the growth of American productivity. Professional hospitality promotes innovation in many ways. They produce more valuable ideas and skills than American-born workers, and they can own companies. Companies that are more active in hiring skilled immigrants also tend to increase the number of native workers, emphasizing that the two types of workers complement each other. Moreover, skilled immigrants tend to raise wages not only for skilled native-born workers but also for low-skilled native-born workers.
Expanding the number of H-1B visas issued each year will increase America’s supply chain by addressing labor shortages and increasing productivity. Perhaps one of the easiest ways to do this is to issue additional H-1B visas to foreign-born individuals who have already identified themselves as skilled professionals and want to live in the United States: foreign students who are enrolled in American colleges. and universities. Last academic year, there were 914,095 such international students in the United States. This coming summer, why not congratulate each of these foreign students who graduated with the award of a new H-1B visa?
A POLITICAL WINNER
Given the divisive nature of immigration politics in the United States, any plan to expand the visa program may seem unrealistic. Read also : The likelihood of a 2023 recession in the United States and Europe continues to rise. Critics will inevitably question how the United States will consider admitting foreign nationals when it appears to have lost control of its borders.
But the flow of migrants along the US-Mexico border is hardly unstoppable. Although the US Border Patrol apprehended or deported a significant number of immigrants in 2021 and 2022, these numbers give a very misleading idea of how many people are entering the country. In fiscal year 2022, for example, the Border Patrol recorded 2.4 million “encounters” along the U.S.-Mexico border. But of those, 1.1 million resulted in deportations to Mexico under Title 42, the provision the United States used to deport immigrants briefly during the crisis. Ironically, because a Title 42 deportation leaves no record of an entry attempt—so there is no legal consequence that can prevent an immigrant from re-attempting to cross the border or even apply for a visa to enter the United States—its use can encouraging immigrants to rush to the border. . Therefore the number of encounters exceeds the number of invaders who attempt to cross into the United States and, by a larger margin, the number who succeed. Expanding the H-2B visa will create another legal entry point.
Those encounters with the Border Patrol that do not result in deportation (1.3 million of them in fiscal 2022) are mostly immigrants seeking asylum, which the U.S. grants to those who have a legitimate fear of persecution at home. Some applicants are now in the United States awaiting an immigration hearing, which may take years; many others have already been denied entry and continue to live abroad. Ironically, America’s success in curbing illegal entry has left asylum as the only option for many immigrants, likely contributing to the recent surge in asylum applications. Therefore, increasing the number of H-1B and H-2B visas may have the added benefit of not burdening the asylum system.
Perhaps surprisingly, expanding immigration can be a political success. Most Americans support immigration, although Democrats are more supportive than Republicans. In a national survey in July 2022, Gallup asked respondents, “Overall, do you think immigration is a good thing or a bad thing for this country today?” Seventy percent said “a good thing.” This positive opinion is shared by men (71 percent) and women (68 percent); among older age groups (especially young people – 83 percent of those aged 18 to 34); and in all educational groups, even those without a college education (64 percent). Republicans are nearly split on the question (46 percent say immigration is good and 45 percent say it is wrong), while major independents (75 percent) and Democrats (86 percent) have a positive opinion. But much of this partisan difference appears to stem from Republican concerns about illegal immigration, not legal immigration through channels like the H-1B and H-2B visa programs. .
Support for allowing skilled immigrants into the U.S. is larger and more partisan. An August 2022 survey by the Economic Development Association found that 71 percent of American voters support skilled immigrants coming to the country — including 83 percent of Democrats, 60 percent of Republicans, and 72 percent of independents. And a majority of Americans from both parties—82 percent of Republicans and 78 percent of Democrats—say immigration reform should be passed in the next 12 months. Expanding the H-1B and H-2B visa programs should be at the center of any reform.
EVERY TOOL IN THE TOOLKIT
Rising inflation and inflation have commanded the attention of economic policymakers around the world. Although there is an agreement on who is guilty, it is agreed that the main banks of the country will reduce the current rate increase. However, as the disease has created new problems in the labor market, it has revealed the need for more solutions to the problems of supply and shortage of workers.
Immigration policy should be part of the anti-inflation tool. Expanding the H-1B and H-2B visa programs will immediately ease the U.S. labor shortage, making it more expensive to produce goods and services—a cost that companies pass on to their employers. use them through the cost of goods. The exact extent to which this move is contributing to inflation is currently difficult to quantify, but there is no doubt that it is playing a significant role and addressing labor shortages will help. The US government needs to fight inflation with everything it has. More immigration could be part of the solution – if policymakers let it.
In terms of current inflation, the main contributing factors include rising incomes, labor shortages and higher wages, declining supply chains, and fuel policies. Inflation is an economic phenomenon where the value of goods and services in the economy increases over time.
Does immigration have a positive effect on society?
FACTS FOR THE AMERICAN INDUSTRY: Immigrants are very entrepreneurial, starting new businesses at a rate that Native Americans hold many jobs. All of this increases jobs for American-born workers, boosts wages and strengthens the middle class.
What are the positive effects of immigration for the country? Immigrants improve the infrastructure and work of the host country, create new opportunities for native workers, provide skills needed for economic growth, generate new ideas, promote international trade, and provide a positive contribution to long-term fiscal balance.
What impact did immigration have on society?
In many central cities, immigration has helped turn rundown neighborhoods into rebounds by raising population and boosting economic growth; and immigration was responsible for the decline in violent crime in American cities from the late 1990s to the early 2000s.
What are 3 positive effects of migration?
ï Migration increases working age. ï Migrants bring skills and contribute to the development of the human capital of the receiving countries. Foreigners also contribute to the development of technology. Understanding these impacts is essential if our societies are to debate the role of immigration.
How does immigration affect economic?
From an economic perspective, proponents of immigration argue that immigrants boost the economy by increasing productivity and promoting innovation. Those who oppose the argument argue that immigrants hurt unskilled workers by taking jobs that American workers would otherwise have or lowering wages for unskilled workers.
How does immigration help the economy? Immigration increases economic growth. When immigrants enter the workforce, they increase economic strength and increase GDP. Their incomes are increasing, but so are those of the citizens.
How has migration affected the economy?
We find that immigrants in developing economies increase productivity and growth both in the short and medium term. Specifically, we show that a 1 percent increase in immigrant inflows relative to total employment increases by about 1 percent in the fifth year.
How does immigration impact the economy quizlet?
Immigration increases the labor force, which increases the economic growth potential.
How have immigrants impacted the economy? Immigrants also make an important contribution to the American economy. Most directly, immigration increases the production potential of the economy by increasing the size of the labor force. Visitors also contribute to productivity growth.
