Taxes and Spending Power
The contributions immigrants make as both taxpayers and consumers are indispensable to the U.S. economy. Nationally, immigrants earned $1.3 trillion in 2014 and contributed $105 billion in state and local taxes and almost $224 billion in federal taxes. This left them with nearly $927 billion in spending power, which they frequently used to purchase goods and services, stimulate local business activity, and create jobs in the broader U.S. economy.
Immigration Key to Future of Rural Appalachia
Jenny Williams, an English professor at Hazard Community and Technical College, knows that immigration has been crucial to rural Perry County. Her father was a doctor in the 1970s, when the region lacked qualified medical professionals. Then Appalachian Regional Healthcare began recruiting foreign-born doctors, primarily from India, to practice at… Read More
Immigrants Start Businesses, Don’t Want Hand-Outs
Elizabeth Cervantes is co-founder of the Southwest Suburban Immigrant Project (SSIP), a nonprofit that advocates for immigrant rights. Based in Bolingbrook, Illinois, the organization caters to the fast-growing immigrant population in the suburbs of Chicago. “About 54 percent of undocumented immigrants in Illinois live in suburban Cook county and collar… Read More
Without Migrant Labor, a Minnesota Resort’s 460 U.S. Workers at Risk
Ben Thuringer is the managing director of Madden’s on Gull Lake, a resort founded by his grandfather in 1929 in the Brainerd Lakes Region of Central Minnesota. The family resort is a seasonal getaway, operating April through October, with more than 1,000 acres and 283 rooms. “Of the 520 people… Read More
Resettled Refugees Contribute Millions to Wisconsin Economy
Since it first opened its doors in 2012, the Christian nonprofit World Relief Fox Valley has resettled 700 refugees in Appleton and Oshkosh, in Wisconsin. “The communities have been supportive, and anyone who doesn’t support the mission doesn’t understand the program or who refugees are,” says the organization’s director, Tami… Read More
Santa Fe Mayor Finds Economic Strength in Diversity
Santa Fe’s mayor, Javier Gonzales, has made inclusivity a hallmark of his tenure. This extends to the immigrants who live in the city of 70,000 that he has governed since 2014. “Today, more than 14 percent of our population in Santa Fe is what we call new immigrants, which are… Read More
Argentinian Immigrant Helps Immigrants Contribute in Omaha
As executive director of Justice For Our Neighbors-Nebraska (JFON-NE), Emiliano Lerda helps families build productive lives in Nebraska and southwest Iowa, a move that in turn helps to bolster the regional economy. Take the young immigrant mother of two who fled domestic violence. When the legal team met her, the… Read More
Immigrants Add Billions to GDP Yet ‘Constantly Under Threat,’ Says Organizer
Argentinian immigrant Beatriz Maya has devoted her career to helping fellow Latinos — both immigrants and natives — build productive, successful lives in the United States. As the founder of La Conexion de Wood County, she helps provide capacity building and cultural activities, language education, and advocacy for an estimated… Read More
A Career Economist Makes the Case for Immigrants
Economist Ann Markusen has spent three decades studying what makes the U.S. economy tick. And a recent teaching post in Canada re-affirmed her view that a welcome approach to immigrants is good for a nation’s bottom line. “Canada’s liberal immigration policies and the nonprofit sector’s efforts to find housing… Read More
A Student of U.S. Immigration Points to Economic Impact
Qingfang Wang had already started a promising career at the Chinese Academy of Social Sciences, one of Asia’s top-ranked think tanks, when the University of Georgia offered her a fellowship for a PhD in geography. She jumped at the chance. “The U.S. has the best higher-education system,” she says. “I… Read More
Undocumented are ‘Paying Money Into U.S. System,’ Says DACA Student
Victoria Matey came to the United States from Mexico at age 3. By age 15 she had been barred from applying for a part-time job, so she already had a vague idea what it meant to be undocumented. But Matey did not understand the full consequences until she was a… Read More
Household Income of Immigrants
In 2014, more than 72 percent of foreign-born population in the United States was working-aged, compared to less than half of U.S.-born residents. This reality allowed immigrants to earn well over a trillion dollars of income in 2014—a greater amount than their portion of the U.S. population overall.
Tax Contributions
A notable portion of the income earned by immigrants each year funnels directly back to our government in the form of tax revenues. In some states, immigrants contribute more than one out of every four tax dollars paid by local residents each year—supporting taxpayer-funded services like public schools and police departments.
States Where Immigrants Contributed the Largest Share of Total Tax Revenues, 2014
Spending Power
Spending power is the disposable income left to households after deducting their annual tax contributions. The $9.3 billion in total spending power held by immigrant led households in 2014 allowed them to hold considerable power as consumers. By spending on goods and services, immigrants strengthen the U.S. economy and provide jobs to American workers as well as the businesses dependent upon paying customers.
Foreign-Born Population’s Amount and Share of Spending Power by State, 2014
Medicare and Social Security
Our Social Security and Medicare programs are already facing serious financial challenges—a pattern expected to worsen as large numbers of Baby Boomers retire and leave the workforce altogether. While the United States had roughly 16 workers paying into our entitlement programs for every one retiree in 1950, that number is projected to drop to just two workers for every retiree by 2035.1 Immigrants are already playing an important role supplementing our entitlement programs: One NAE study found that between 1996 and 2011 immigrants contributed $182.4 billion more to Medicare’s Hospital Insurance Trust Fund—the core trust fund in the program—than was expended on their care.
Sources:
1 “10 Truths About America’s Entitlement Programs, Address by R. Bruce Josten Executive Vice President of Government Affairs U.S. Chamber of Commerce,” U.S. Chamber of Commerce, accessed September 21, 2016. Available online.
Bolstering the Housing Market
By purchasing homes in neighborhoods formerly in decline, immigrants in recent decades have had a positive impact on U.S. housing values overall. From 2000 to 2010, each of the 40 million immigrants in the United States added, on average, 11.6 cents to the value of a home in their local county. That seems small, but it adds up. In fact, it resulted in immigrants growing U.S. housing wealth by $3.7 trillion during that period.2 Immigrants are also expected to play a key role buying up homes as baby boomers downsize in the coming years: Almost 30 percent of American homeowners were older than age 65 in 2014.
Sources:
2 Jacob Vigdor, “Immigration and the Revival of American Cities,” New American Economy, 2013 Available online.
Immigrant Subgroups
Regardless of where the immigrants came from, they contribute a tremendous amount of money to the U.S. economy as taxpayers and consumers. In this section, we show the amount earned and contributed in taxes by different ethnic and national origin groups within the foreign-born population.
Taxes & Spending Power of Major Immigrant Subgroups
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