Immigration 2021: An Economic Crisis Solution

Immigration 2021: An Economic Crisis Solution

The United States labor shortage has created problems the nation’s economy hasn’t faced in generations. As reported by the U.S. Chamber of Commerce, companies across the nation are turning down work because they don’t have the employees to do it. This shortage has also led to supply chain bottlenecks, which result in a lack of inventory and higher prices for consumers.

The first half of 2021 was filled with debates over extended unemployment benefits and the need for higher wages. Those benefits have ended, employers are paying more, and the problem persists. This is because the root of the problem is a shrinking U.S. workforce, and it’s not a short-term issue.

While potential solutions exist, none offer the same short and long-term positive impact as immigration. While the U.S. has numerous programs to this effect, they’ve proved insufficient for dealing with current job market demands.

There’s been a lot of talks, and little action, when it comes to immigration reform. This has to change, as it’s become critical to our economic well-being.

The Immigration Downturn

As expected, immigration experienced a large downturn during Covid. At the time, with millions of Americans out of work, there weren’t many objections to it. Why would we be concerned with more people coming in when so much of the workforce furloughed?

A new picture emerged in 2021, as companies found themselves unable to bring back the staff needed to fully open back up. While folks argued about the enhanced unemployment benefits and higher wages, the real culprits were:

  • A record number of retirements in 2020.
  • Fewer workers coming into the job market due to record-low birth rates.
  • A downturn in full-time labor participation.
  • A 54% downturn in new immigrant/non-immigrant visas.

This downturn in visas hit industries that rely on these workers, including agriculture and tech, hard. Contrary to popular beliefs, there wasn’t a multitude of Americans ready to take those positions.

The Greater Impact

A lot of immigration talk focuses on the immigrants themselves and the businesses they work for. The worker shortage makes clear our dysfunctional immigration system has a negative effect on everyone. This lack of people led to:

  • Businesses having to limit their hours, or not being able to reopen at all.
  • Supply chain issues, leading to shortages (and higher prices).
  • Higher employment costs.
  • Critical services, including medical, are not being available to people in need.

As of today, immigration is the most effective potential solution for this problem. Even if there was a good way to turn around the birthrate, it would take a generation for the changes to take hold. Solving the work participation issue also requires a long rollout, if we can even get an agreement on a solution.

In the meantime, we have millions of potential American Citizens who would be all too happy to help build a better future. Too often, we cling to stereotypes, such as the lazy immigrant, out of a fear they’ll take what we have. In reality:

  • They have a higher workforce participation rate (65.7%) than native-born Americans (62.3%).
  • As mentioned, they fill key labor gaps in our economy (including in areas such as medicine and engineering).
  • They grow our economy, not take from it, including through a high rate of entrepreneurship.

The U.S. has always benefited from immigration, including during times of conflict and uncertainty. Now, our immigration dysfunction is helping create that uncertainty.

“I Support Legal Immigration”

Most Americans, from both sides of the political spectrum, support the idea of immigration. The biggest objection is people coming here illegally, instead of the legitimate path.

The issue revolves around a question: why don’t illegal immigrants “wait their turn in line”?

This question disregards clear problems in our current programs. It’s an outdated system, with rules and regulations out of alignment with our current situation. Most potential immigrants can’t “wait in line” because there is no line.

A hard worker who wants to come to the United States but isn’t a refugee has no family here, or special training for employment-based sponsorship has no options. There is no legal route for them to become an American.

This doesn’t excuse illegal immigration or the exploitation of it. That said, a path to citizenship for those outside these categories would open a legitimate doorway to come here. It’s hard to imagine most wouldn’t take it.

As we’ve pointed out before, even those who fit into those categories are faced with a difficult, expensive process that often sends them home based on out-of-date, or arbitrary, limits. We eject thousands of skilled professionals we desperately need every year because of this.

The goal of “protecting American jobs” is laudable, but the actions taken in that regard are imperiling the overall economy.

Who Can Get It Done

While we’re all happy to argue about immigration problems, there’s little political will to create a solution. Bills get brought up, and shot down, every year addressing H1B visas, migrant workers, illegal aliens, etc. No one yet has shown the drive to push them through, or do what’s really necessary: a complete overhaul of United States immigration laws.

It won’t happen until the public calls for it. While the fallout from our poor immigration policies is clear to everyone, those outside the loop don’t have a good sense of its source. Those of us who deal with the system have a responsibility to bring the public up to speed, so it can put the correct pressure on our leaders.

A dysfunctional immigration system is a threat to our democracy. A strong one will open doors to benefit everyone.

For 30+ years, PRA USA has helped our clients and candidates navigate the ever-changing job market in the fields of Electronics, Embedded, and Controls Systems. Contact us to discuss your recruiting headaches, so we can help you find a solution.

Leave a Reply