Immigration is key to US job market and economic plans

Significance

Behind this workforce expansion is higher immigration that has allowed considerably more new jobs without raising real wages. Immigration explains some of the strength in consumption and overall economic growth since 2023.

Impacts

• A virtuous circle of brisk job creation, immigrant labour and labour income is helping the US economy to outgrow most other rich nations.
• Productivity, as proxied by output per hour, is rising faster than real wages, dampening the motivation to raise prices.
• Immigration, while bringing many benefits, is a complex policy issue; there will always be political voices wanting to impose more control.
• Immigration ranks as the most volatile domestic issue, with Gallup survey respondents rating it as the country’s “most important problem”.