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Are immigrants taking jobs from U.S. workers? Here’s what economists say

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The first debate between Vice President Kamala Harris and former President Donald Trump is shown on television at the Juventud 2000 migrant shelter in Tijuana, Mexico, on Sept. 10, 2024. Immigration has been a hot topic throughout the presidential campaign.

Carlos Moreno/NurPhoto via Getty Images

The idea that immigration has a negative impact on the U.S. job market is a common theme of former President Donald Trump’s speeches on the presidential campaign trail.

“They’re taking your jobs,” the Republican nominee told supporters on Sept. 21 in Wilmington, North Carolina.

Immigration is also a top issue for Republican voters: 82% of Trump supporters say immigration is “very important” to their vote in the 2024 presidential election, second only to the economy, according to the Pew Research Center. It’s the lowest-priority issue for Democrats, Pew found. Pew polled 9,720 U.S. adults from Aug. 26 through Sept. 2.

However, evidence suggests immigrants help the overall economy. And, at a high level, they aren’t taking jobs from or reducing the wages of U.S.-born (or so-called native) workers, according to economists who study the impact of immigration on the labor market.

“Overall, the consensus is very strong that there are not significant costs to U.S.-born workers from immigration, at least the type of immigration we have historically had in the U.S.,” said Alexander Arnon, director of business tax and economic analysis at the Penn Wharton Budget Model.

Immigrants expected to boost the economy

There are several reasons why immigrants largely benefit the economy and job market, economists said.

For one, the job market isn’t static.

Immigrants take jobs but they also create new ones by spending in local economies and by starting businesses, economists said. One 2020 research paper from the National Bureau of Economic Research found immigrants are 80% more likely to become entrepreneurs than native workers.

A recent “surge” of immigrants to the U.S. is expected to add $8.9 trillion (or 3.2%) to the nation’s GDP over the next decade, according to the Congressional Budget Office, a nonpartisan scorekeeper for Congress.

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“That’s enormous,” said Michael Clemens, a professor at George Mason University and an economist whose research examines the economic causes and effects of migration. “That creates jobs, that raises pay, that is an increase in the size and complexity of the U.S. economy.”

Immigrants also aren’t perfect substitutes for U.S. citizens in many job positions; in fact, the two groups often complement each other rather than compete, economists said.

However, some economic research suggests immigration can impact the wages of certain subgroups of U.S.-born workers, especially those with lower levels of educational attainment.

Overall, the consensus is very strong that there are not significant costs to U.S.-born workers from immigration.

Alexander Arnon

director of business tax and economic analysis at the Penn Wharton Budget Model

Some economists contend an influx of immigrants can reduce wages for such Americans in the short term, though other researchers have found that Americans ultimately benefit, partly because those in direct competition with immigrants are able to find higher-paying jobs.

“Not everybody agrees about it,” Clemens said.

A big supply of new labor due to immigration can be “difficult and anxiety-inducing” for American workers who must adjust, he added.

“But people end up in better circumstances,” he said.

Immigration helped cool ‘overheated’ job market

The El Chaparral pedestrian border crossing at the San Ysidro Port of Entry in Tijuana, Mexico, on Jan. 4, 2024. 

Carlos Moreno/Bloomberg via Getty Images

Immigrants accounted for about 14% of the U.S. population in 2022, according to Pew, citing most recently available federal data.

Most are in the U.S. legally: Undocumented immigrants represented 3.3% of the total U.S. population and 23% of immigrants in 2022, Pew said. Their number has increased in recent years, to 11 million, but remains below its 2007 peak of more than 12 million.

The number of immigrants coming to the U.S. has “increased sharply in recent years,” the CBO wrote in July.

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Net immigration is expected to be 8.7 million people higher from 2021 to 2026 than would have been extrapolated from pre-Covid migration trends, the CBO said. (Its analysis excludes those with green cards.)

The influx has been beneficial for the pandemic-era economy, economists said.

It “helped cool an overheated labor market” over the past two years, Elior Cohen, an economist at the Federal Reserve Bank of Kansas City, wrote in May.

Demand for workers hit historic highs as the U.S. economy started to reopen in 2021. Wages rose sharply — at their fastest pace in decades — as businesses competed for workers, putting upward pressure on high inflation.

Immigrant labor alleviated “severe staffing shortages,” especially in industries like leisure and hospitality, helping dilute those inflationary wage pressures, Cohen wrote.

In this sense, immigrants weren’t competing with U.S. citizens for jobs but instead taking a surplus of available jobs, said Giovanni Peri, an economics professor and director of the Global Migration Center at the University of California, Davis.

In fact, a long-term net decline in the number of non-college-educated immigrants to the U.S. from 2010 to 2021 likely contributed to those recent labor shortages, he said.

“If there is a time when low-skilled immigration isn’t competing with natives and helping fill shortages, it’s been the last two years,” Peri said.

‘Little evidence’ of employment impact

Even before the Covid-19 pandemic, economists from varying sides of the debate published a “consensus” viewpoint in 2017 on the job market effect of immigration, Clemens said.

The panel of economists found “little evidence that immigration significantly affects” overall employment levels among Americans, they wrote for the National Academies of Sciences, Engineering, and Medicine.

“I’d say the consensus has gotten [even] stronger” since then, said Arnon of the Penn Wharton Budget Model, who authored a separate 2016 analysis of existing research on immigration’s economic impact.

To the extent there’s job competition from new immigrants, it tends to fall mostly on prior immigrants rather than native U.S. workers, according to the National Academies paper.

Prior immigrants are most likely to experience “negative wage effects,” it said.

However, native-born high school dropouts may experience that effect, as well, since they “share job qualifications similar to the large share of low-skilled [immigrant] workers,” the National Academies paper said.

Immigrants without a high school degree account for the largest share of foreign-born workers, followed by those with graduate or professional degrees, according to the Penn Wharton analysis.

A heated debate on low-skilled workers

A boat arrives in Key West, Florida with Cuban refugees in April 1980 from Mariel Harbor after crossing the Florida Straits.

Tim Chapman | Miami Herald | Getty Images

One influential — and controversial — paper by Harvard economist George Borjas echoes that finding about high school dropouts.

Borjas — who was among the more than three dozen economists who authored the National Academies consensus paper — studied the Mariel boatlift, a mass emigration of 125,000 Cuban refugees to South Florida from April to October 1980.

At least 60% of these “Marielitos” were high school dropouts, he said. Borjas found that the large boost in labor supply caused the wages of high school dropouts in Miami to drop “dramatically,” by 10% to 30%.

Stephen Miller, a senior policy adviser during the Trump administration, cited the paper in 2017 as a justification for a new proposal to curtail legal immigration, particularly among lower-skilled workers.

Asked to comment on Trump’s campaign statements about immigration and jobs, Anna Kelly, a spokeswoman for the Republican National Committee, said in an emailed statement that the former president “has never wavered in his promise to put America First, including workers born in the USA and incentivizing companies to keep jobs at home.”

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Borjas’ finding was in contrast with earlier work by economist and Nobel laureate David Card, who had found the Mariel boatlift didn’t increase unemployment or negatively affect wages of “less-skilled” non-Cuban or Cuban workers.

Some economists, including Clemens, dispute Borjas’ findings. Borjas didn’t return a request for comment.

“Sudden surges of immigration obviously affect the ability of native workers to find and take jobs on a given afternoon,” Clemens said.

But immigrants “also create jobs,” Clemens said. “A large preponderance of evidence is the job creation effect overwhelms the competition effect, even in the short term.”

Effect may depend on the economic environment

Migrant workers pick strawberries during harvest south of San Francisco.

Joe Sohm/Visions Of America | Universal Images Group | Getty Images

Native U.S. workers and immigrants, even those with similar educational backgrounds, tend to complement each other via their skills, making each other more productive and in essence jointly creating each other’s jobs, Clemens said.

For example, in a restaurant, a native worker with better command of spoken English might be a waiter, while an immigrant might do kitchen-prep work or wash dishes, tasks that don’t require such language dexterity. On farms, native workers might be supervisors or run high-tech equipment while immigrants handpick crops, Clemens said.

Research by Peri and Alessandro Caiumi of the University of California, Davis, finds that factors like “occupational upgrading” generally lead native workers who initially compete with immigrants for jobs to earn higher wages in the future.

For example, from 2000 to 2019, such factors helped boost wages for less-educated native workers by a “significant” 1.7% to 2.6%, and there was also “no significant wage effect on college educated natives,” Peri and Caiumi wrote. Similarly, from 2019 to 2022, estimates suggest “small positive effects” on wages.

Ultimately, “what might have happened in Florida during the Mariel boatlift in the 1980s may be different than what happens in Arizona in the 2010s,” said Michael Strain, director of economic policy studies at the American Enterprise Institute, a right-leaning think tank.

“From a policy perspective, you have to figure out which of the studies are most relevant to the current economic environment you’re considering,” Strain said.

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House GOP tax bill calls for $30,000 ‘SALT’ deduction cap

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Chairman Jason Smith (R-MO) speaks during a House Committee on Ways and Means in the Longworth House Office Building on April 30, 2024 in Washington, D.C.

Anna Moneymaker | Getty Images News | Getty Images

House Republicans are calling for a higher limit on the deduction for state and local taxes, known as SALT, as part of President Donald Trump‘s tax and spending package.

The House Ways and Means Committee, which oversees tax, released the full text of its portion of the bill on Monday afternoon. The SALT provision would raise the cap to $30,000 for those with a modified adjusted gross income of $400,000 or less.

However, the SALT deduction limit has been a sticking point in tax bill negotiations and the provision could still change significantly. The committee is scheduled to debate and vote on the legislation on Tuesday afternoon.    

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Enacted via the Tax Cuts and Jobs Act, or TCJA, of 2017, there’s a $10,000 limit on the federal deduction on state and local taxes, known as SALT, which will sunset after 2025 without action from Congress.

Currently, if you itemize tax breaks, you can’t deduct more than $10,000 in levies paid to state and local governments, including income and property taxes.

Raising the SALT cap has been a priority for certain lawmakers from high-tax states like California, New Jersey and New York. With a slim House Republican majority, those voices could impact negotiations.

While Trump enacted the $10,000 SALT cap in 2017, he reversed his position on the campaign trail last year, vowing to “get SALT back” if elected again. He has renewed calls for reform since being sworn into office.

Lawmakers have floated several updates, including a complete repeal, which seems unlikely with a tight budget and several competing priorities, experts say.

“It all has to come together in the context of the broader package,” but a higher SALT deduction limit could be possible, Garrett Watson, director of policy analysis at the Tax Foundation, told CNBC earlier this month.

Here’s who could be impacted.

How to claim the SALT deduction

When filing taxes, you choose the greater of the standard deduction or your itemized deductions, including SALT capped at $10,000, medical expenses above 7.5% of your adjusted gross income, charitable gifts and others.

Starting in 2018, the Tax Cuts and Jobs Act doubled the standard deduction, and it adjusts for inflation yearly. For 2025, the standard deduction is $15,000 for single filers and $30,000 for married couples filing jointly.

Because of the high threshold, the vast majority of filers — roughly 90%, according to the latest IRS data — use the standard deduction and don’t benefit from itemized tax breaks.

Typically, itemized deductions increase with income, and higher earners tend to owe more in state income and property taxes, according to Watson.

Who benefits from a higher SALT limit

Generally, higher earners would benefit most from raising the SALT deduction limit, experts say.

For example, an earlier proposal, which would remove the “marriage penalty” in federal income taxes, involves increasing the cap on the SALT deduction for married couples filing jointly from $10,000 to $20,000.

That would offer almost all the tax break to households making more than $200,000 per year, according to a January analysis from the Tax Policy Center.

“If you raise the cap, the people who benefit the most are going to be upper-middle income,” said Howard Gleckman, senior fellow at the Urban-Brookings Tax Policy Center.

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Of course, upper-middle income looks different depending on where you live, he said.

Forty of the top 50 U.S. congressional districts impacted by the SALT limit are in California, Illinois, New Jersey or New York, a Bipartisan Policy Center analysis from before 2022 redistricting found.

If lawmakers repealed the cap completely, households making $430,000 or more would see nearly three-quarters of the benefit, according to a separate Tax Policy Center analysis from September.

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Personal Finance

After UK, China trade deals, tariff rate still highest since 1934: Yale

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A cargo ship moors at the container terminal berth of Lianyungang Port for loading and unloading containers in Lianyungang City, Jiangsu Province, China, on May 9, 2025.

Nurphoto | Nurphoto | Getty Images

The tariff rate the U.S. puts on imports remains higher than any point since the 1930s, despite trade deals struck with China and the United Kingdom in recent days, according to a Yale Budget Lab report issued Monday.

The total U.S. average effective tariff rate is 17.8% — the highest since 1934 — even after accounting for these policy changes, according to the Yale Budget Lab.

That’s equivalent to an increase of 15.4 percentage points from the average effective tariff rate before Trump’s second term, the report said.

Current tariff policies in effect are expected to cost the average household $2,800 over the “short run,” according to the report. It doesn’t specify a time frame.

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Consumers will likely alter their buying

Prior to the China and U.K. trade pacts, consumers faced an overall average effective tariff rate of 28%, the highest since 1901, the Yale Budget Lab estimated in a prior analysis on April 15.

The estimated decline from that average tariff rate “is almost entirely due to the lower rates on Chinese imports — the US-UK trade deal has minimal effects on average tariff rates,” its most recent report said.

Businesses and consumers are likely to change their purchase behavior to avoid the higher costs associated with tariffs, especially from China, according to economists.

After accounting for these substitution effects, the average effective tariff rate would be 16.4%, the highest since 1937, the Yale Budget Lab estimates.

The timing of that substitution is “highly uncertain,” it said.

“Some shifts are likely to happen quickly — within days or weeks — while others may take longer,” according to the report.

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Personal Finance

Fidelity technical issues kept some investors out of their accounts

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A Fidelity Investments branch.

Nicholas Pfosi | The Boston Globe | Getty Images

Limited ability to trade in a big market day

The brokerage’s login issue may have been a greater problem for day traders, institutional investors and options investors, or investors who want to buy at a certain price before the market jumps, said certified financial planner Lazetta Rainey Braxton, the founder and managing principal of The Real Wealth Coterie.

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Not having access to their brokerage accounts during big market swings can hurt their strategies because they are actively managing their portfolios, said Braxton, a member of CNBC’s Financial Advisor Council.

But for long-haul investors, a login glitch that lasts a few hours might not make a huge difference, she said.

“Most investors are not chasing the market,” Braxton said.

‘Remain calm’

Technical issues at brokerages have happened in the past. In August, customers of Charles Schwab and Fidelity Investments were unable to trade in the middle of a steep market sell-off of global equities.

If a blip like this happens again, “it is important for investors to remain calm,” said Carolyn McClanahan, a certified financial planner and the founder of Life Planning Partners in Jacksonville, Florida. She’s also a member of CNBC’s Financial Advisor Council.

While it can be a grievance at the moment, such technical difficulties are temporary — “these outages usually don’t last long,” said CFP Cathy Curtis, the founder and CEO of Curtis Financial Planning in Oakland, California.

And besides, “tech outages will not affect the value of investments,” said Curtis, a member of CNBC’s Financial Advisor Council

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