At a glance:
- People seeking asylum and refuge pay more in taxes than they receive in public assistance over the long term, providing overall benefits to employers and the economy
- These same people perform similarly on various economic metrics to US-born Americans over the long run
- Immigration generally is projected to result in $7 trillion of additional economic output nationally over the next decade
- The Maine legislature should reject the Governor’s proposed cuts to assistance programs and continue to work toward robust policies that protect immigrants as well as existing Mainers
Immigrants are boosting the economy
A major new study by the US Department of Health and Human Services (USDHHS) shows asylum-seekers and refugees provide net fiscal benefits to federal, state, and local governments, and these individuals perform similarly on various economic metrics to US-born Americans over the long run. The USDHHS report examined the costs to all levels of government from providing support for asylees and refugees during the period 2005-2019 and offset those against the estimated tax revenue from these individuals. At the federal level, there was a net fiscal benefit of $31.5 billion over this period; and at the state and local level, there was a net fiscal benefit of $92.3 billion ($125.7 billion of expenditures offset by $218 billion in revenues). The study confirms while people seeking asylum and refuge often require considerable public assistance when they first arrive in the country, they more than pay back that assistance through taxation over the long run.
Immigration more broadly also has significant economic benefits. The Congressional Budget Office (CBO) recently upgraded its long-term economic outlook to reflect higher than expected levels of immigration which CBO finds will result in $7 trillion of additional economic output over the next decade.
Meanwhile, there is also evidence of the benefits of immigration over the short term. As the economy rebounded since the end of the COVID-19 pandemic, immigrants played an outsized role in filling empty jobs, at the same time US-born Americans are experiencing record low levels of unemployment. In other words, immigrants are boosting the US economy without hurting Americans’ outcomes.
Lawmakers should champion policies that support immigrants
These findings are particularly relevant for Maine lawmakers in the current moment. Even more than the United States as a whole, Maine has a very strong labor market and Maine employers are looking for workers. The latest data still shows two job openings for every unemployed worker in the state. Meanwhile, Maine is seeing higher than usual levels of immigration. Between 2013 and 2022, approximately one fifth of all the state’s population growth, just under 12,000 people, consisted of foreign-born residents.
The national experience demonstrates how this immigration flow can be a boon to Maine’s employers and economy. While many immigrants, especially people coming as refugees or seeking asylum need substantial support from state and local governments when they first arrive, after a few years their earnings rise substantially and their need for support diminishes.
Data from Maine also bears this out — while immigrants’ earnings are typically low in the first year or so in the state, these grow rapidly and their use of public assistance decreases. It should be noted that a major contributor to the lack of earnings in immigrants’ first years in the US is the bar on working for asylum seekers and refugees for at least 180 days (and delays in the application process can push this back even further).
Note: Use of public assistance programs is dependent on eligibility for non-citizens, which varies by program and immigration status, and which underwent several policy changes during the period analyzed.
All people and communities do better when everyone has the resources they need to prosper and thrive. Lawmakers should ensure immigrants, especially people seeking asylum and refuge, have the support they need during their time of arrival in the US until they are able to settle into a community, make connections, and begin working. Once they do so, the investments made in state supports will pay off through stronger economic growth and increased tax revenue. Maine legislators have already taken steps in this direction, for example expanding MaineCare eligibility for children and pregnant people regardless of immigration status in 2022. However, some assistance programs are under threat in the Governor Mills’ latest supplemental proposal, including food assistance for people who have recently received work authorization, and the ability of towns to offer general assistance to any Mainer who may be at risk of homelessness.
Maine Center for Economic Policy urges the legislature to reject the Governor’s cuts and continue to work toward robust policies that protect immigrants as well as existing Mainers.
