Connect with us

Personal Finance

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

Published

on

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.

The 2024 election is going to come down to immigration and affordability, says pollster Frank Luntz

“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.

More from Personal Finance:
How the presidential election could affect your taxes
Judge blocks Biden’s new student loan forgiveness plan
Harris wants to raise the top capital gains tax rate to 28%

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.”

US election to come "right down to the wire": Evercore ISI

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.

Continue Reading

Personal Finance

Maximizing Returns in High Rate Climate and market uncertainty

Published

on

Maximizing Returns in High-Rate Climate

In the macroeconomic environment of late July 2026, personal cash management requires an active, structured approach to wealth preservation. With central bank benchmark rates remaining elevated to ensure long-term disinflation, conservative yield-bearing vehicles—such as short-term U.S. Treasury bills, money market funds, and high-yield savings accounts (HYSAs)—continue to offer reliable nominal returns between 4% and 5%. For individual investors, maximizing net returns requires moving beyond passive checking accounts and executing a disciplined cash laddering strategy.

Leaving substantial liquid capital in traditional bank deposits creates an invisible drag on personal net worth due to ongoing inflation. By implementing a tiered liquidity framework, individuals can split emergency cash reserves and short-term capital allocations across rolling maturities. Allocating cash into 4-week, 8-week, and 13-week Treasury bills creates a continuous cycle of maturing liquidity, allowing investors to continuously reinvest capital at prevailing market yields while maintaining immediate access to emergency funds.

Tax efficiency represents a critical dimension of high-yield cash optimization. For high-earning individuals residing in states with substantial local income taxes, direct holdings in short-term U.S. Treasury instruments often deliver superior net post-tax yields compared to standard commercial bank HYSAs. Because interest earned on federal Treasury bills is strictly exempt from state and local taxation, investors can retain a larger portion of their compounding interest gains without taking on additional credit or market risk.

Ultimately, personal wealth accumulation in mid-2026 relies on intentional capital deployment. Cash should be managed as a productive asset class that generates consistent, risk-free returns. Regularly auditing account yield terms, automating recurring transfers, and leveraging tax-advantaged fixed-income instruments ensures that personal liquidity remains fully optimized against macroeconomic fluctuations.

Continue Reading

Personal Finance

Algorithmic Wealth Management: Balancing Automated Financial Planning with Human Oversight

Published

on

Balancing Automated Financial Planning with Human Oversight

The personal finance industry in July 2026 is experiencing a technological evolution, driven by the wide deployment of next-generation algorithmic wealth management tools. Modern digital financial platforms have expanded far beyond basic automated index investing; today’s robo-advisors utilize real-time tax-loss harvesting, dynamic portfolio rebalancing, and hyper-personalized spending analysis to optimize retail investor outcomes. However, as these digital solutions become ubiquitous, investors face the crucial challenge of balancing automated execution with human strategic judgment.

The core advantage of automated financial planning platforms lies in their ability to remove emotional bias from investment execution. During periods of market volatility or localized sector realignments, automated algorithms systematically rebalance portfolios back to target asset allocations without falling victim to panic selling or speculative enthusiasm. Furthermore, integrated cash-flow monitoring algorithms analyze individual spending patterns in real time, automatically sweeping surplus income into designated retirement or debt-liquidation accounts to accelerate net worth accumulation.

Despite these operational advantages, algorithmic tools have inherent structural limitations when addressing complex, highly personalized financial life events. Decisions involving multi-generational estate planning, highly complex tax strategies, small business exits, or nuanced real estate transactions require contextual human judgment that software models cannot replicate. Relying solely on automated models without periodic human professional review can result in misaligned risk profiles or overlooked tax liabilities during major life transitions.

The optimal approach for personal financial planning in late 2026 is a hybrid advisory model. Individuals should utilize automated platforms for routine asset allocation, continuous tax optimization, and low-cost passive index tracking, while engaging qualified human financial advisors for periodic strategic planning, estate structuring, and qualitative risk evaluations. This dual approach ensures maximum cost efficiency and disciplined execution while retaining essential strategic guidance.

Continue Reading

Personal Finance

High-Yield Optimization: Structuring Personal Cash Reserves in a Sustained Rate Environment

Published

on

Structuring Personal Cash Reserves in a Sustained Rate Environment

In the financial environment of mid-2026, personal cash management has re-emerged as a vital component of holistic wealth building. With central bank policy rates holding firm to maintain long-term price stability, yield-bearing instruments such as money market funds, high-yield savings accounts (HYSAs), and short-term Treasury bills continue to offer compounding returns around 4% to 5%. For individual investors, effectively structuring cash reserves requires shifting away from passive bank deposits toward active yield optimization.

A frequent pitfall in personal asset management is leaving substantial liquid capital in traditional checking or low-yield savings accounts, where real returns are continuously eroded by baseline inflation. By implementing a disciplined ‘cash ladder’ strategy—allocating liquid funds across tiered maturities using ultra-short Treasury instruments and FDIC-insured high-yield accounts—individuals can secure maximal yields while retaining immediate liquidity for emergency expenses or tactical investment opportunities.

Simultaneously, investors must evaluate the tax efficiency of their cash holdings based on their tax bracket and geographic location. For high earners situated in states with high local income taxes, direct holdings in short-term U.S. Treasury bills often yield a higher net post-tax return than standard high-yield savings accounts, as Treasury interest is strictly exempt from state and local taxation. Understanding these nuanced tax distinctions allows individuals to capture significant incremental gains without taking on additional market risk.

Ultimately, personal financial health in late 2026 hinges on intentional liquidity management. Cash reserves should not be viewed merely as static emergency funds, but as a dynamic asset class that contributes positively to net worth growth. Regularly auditing yield terms, automating cash transfers, and optimizing for post-tax efficiency ensures that personal capital remains fully productive across all economic conditions.

Continue Reading

Trending