Immigration Surge Eases Labor Shortages, Cools Inflation Without Raising Unemployment

Immigration spike has helped ease labor shortages and cool inflation without raising unemployment. Nearly 3/4 of labor supply increase is foreign-born.
More visa processing and increased labor participation by existing immigrants have added hundreds of thousands of new workers.
Impact on inflation not totally clear since more workers also means more consumer demand.
Participation especially increased among foreign-born after big Covid drop in that population.
Pace of immigration growth may not last, so Fed still has work to do on demand side. More immigration needed long-term.

politico.com

Relevant topic timeline:

8/20/2023

The end of low unemployment

Australia's record pace of immigration is outpacing labor demand, leading to a rise in unemployment and lower wage growth.

8/22/2023

'Migrant-led start-ups do better': interview with the founder of On Way Ventures

Main topic: Funding migrant-led start-ups Key points: 1. Immigrant founders are more likely to build outstanding companies due to their resilience and determination. 2. Immigrants have already overcome significant challenges to get to the starting line, making them more grittier and less likely to give up. 3. Immigrants have the potential to leverage international networks and adapt to ensure their business succeeds, making them better positioned for success.

8/24/2023

Business leaders: Solution to dire worker shortage is immigration reform

The Biden administration's Inflation Reduction Act is creating jobs, but the United States is experiencing a shortage of skilled workers, leading business leaders to call for an expansion of work permits for immigrants to fill the workforce gap.

8/26/2023

There are almost 4 million more open roles than job seekers in the U.S. Here's why some economists think the immigration and labor crises are related

The United States is experiencing a high number of job openings, but a shortage of workers, leading to a debate on whether immigration policies should be more open to address this gap.

9/1/2023

What the latest jobs report signals for American workers

The August jobs report shows a healthy labor market with steady growth, although there are signs of cooling due to higher interest rates and downward revisions to previous job numbers, but overall it is seen as a robust report, with women and immigrants playing a significant role in the labor force. There are some concerns, such as Americans spending down their savings and potential consequences of the Federal Reserve's rate hikes.

9/16/2023

New study questions economic consensus on immigration

A major paper challenges the notion that higher immigration is always vital for the economy, suggesting that a smaller population could have a higher quality of life and that predictions of dire effects from a shrinking population are implausible. This challenges the long-standing belief that mass immigration always brings economic benefits, highlighting the need for a serious discussion on the topic.

Topics

Posted 9/20/2023, 9:00:00 AM