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.
Republican Party Official: Immigrants Should be Allowed to ‘Come Out of the Shadows’ to Contribute Their Best to America
Linda Lee Tarver says she and her nine siblings were raised by “very fiscally and socially conservative Christian people,” and Tarver — now the president of the Republican Women’s Federation of Michigan — says her faith remains the foundation for her political beliefs, including when it comes to… Read More
To Avoid Labor Shortage, Economic Expert Recommends Immigration Reform
As president and CEO of economic research and analysis firm The Perryman Group, Dr. Ray Perryman has spent the past 40 years researching what makes the American economy tick. And one thing our economy depends upon is immigration. “The numbers are overwhelming,” Perryman says of the nation’s need for immigrants,… Read More
State Representative and Entrepreneur Says Talent Shortage is Hurting Economic Growth
Sam Rasoul epitomizes the ambitious spirit of America’s immigrant families. “My parents left the Middle East due to turmoil in the late 1960s,” says Rasoul, who was born in Ohio and raised in the Roanoke Valley. Rasoul, who would go on to earn an MBA, start two businesses, and help… Read More
When Immigrants Move to Take Pork Industry Jobs, Businesses in Downtown Guymon Thrive
As the program director of Main Street Guymon, a resource center dedicated to helping businesses in the small city of Guymon, Oklahoma, succeed, Melyn Johnson has unique insight into what allows her community to thrive. Since its founding in 2005, her group has accumulated roughly $10 million in private funding. Read More
Patricia Serrano’s Son Just Graduated from Williams College, But She Couldn’t Attend the Ceremony
As an undocumented immigrant who came to southern California from Mexico 22 years ago, Patricia Serrano has achieved part of the American dream: She raised a son who recently graduated from prestigious Williams College in western Massachusetts. However, she could not fly cross-country to see him receive his diploma, because… Read More
Advancing the Pittsburgh Region
New American Economy (NAE) has released a research brief that highlights the economic and demographic contributions of immigrants in the Pittsburgh region. The brief shows that the 10-county Pittsburgh region’s 82,308 immigrant residents have a significant positive impact on southwestern Pennsylvania’s economy through high rates of workforce participation… Read More
Immigration Lawyer Sees How Immigrants Boost New Orleans’ Economy
As acting director of the Stuart H. Smith Law Clinic & Center for Social Justice at Loyola University College of Law in Louisiana’s 1st Congressional District, Ramona Fernandez oversees between 400 and 500 cases at a time. Roughly 40 percent of those are part of the clinic’s immigration law branch,… Read More
Immigrants Mean Strong Economy and Tax Base, Says Leader of Alabama Nonprofit
Isabel Rubio, a second-generation Mexican American and executive director of the Hispanic Interest Coalition of Alabama (HICA), believes that when we give all Americans – immigrants or otherwise – equal opportunities, the entire country benefits. “Forget what side of the immigration line you’re on, this is an economic issue,” says… Read More
With the Proper Tools, Immigrants can Boost Housing Values, says Financial Educator
Irene Caudillo’s father, a Mexican immigrant, didn’t get a bank account until he was 62 years old. He was typical of many immigrants, then and now — wary of banks and unaware that mortgages and business loans are available to them. The unbanked, as they’re called, end up more likely… Read More
President of U.S.-India Chamber of Commerce Dallas/Fort Worth Explains Slow Immigration Process’s Negative Economic Impact
When Neel Gonuguntla was appointed president of the U.S. India Chamber of Commerce Dallas/Fort Worth in 2014, her mission was to unite the Indian business community with the area’s non-Indian business community. “We want to make sure that the broader community is aware of the on-goings in the Indian business… 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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