Politics

Why California's surge in immigration is lifting our economy

Published

6 months ago

July 31, 2024

Why California's surge in immigration is lifting our economy

Kamala Harris had no sooner replaced Joe Biden as the presumptive Democratic presidential nominee than Donald Trump began bashing her over the number of immigrants coming into the United States, declaring that they had driven countless American workers from their jobs.

But the data on U.S. employment and the economy overwhelmingly suggest a reality far more beneficial when it comes to immigration than the nightmarish vision the former president has put forth.

The surge of international migrants since 2021 — including refugees, asylum seekers and others entering legally and illegally — has lifted the U.S. and California economies by filling otherwise vacant jobs, helping to keep job creation strong, growing businesses and pumping millions of tax dollars into state, local and federal coffers.

Payroll taxes on immigrant workers have even helped relieve pressure on the nation’s embattled Social Security system.

There are, of course, short-term public costs associated with acclimating so many new arrivals, plus government expenditures on education and health services for immigrants and their families, along with the political and social challenges. Many agree the current immigration system is flawed and chaotic.

But from a budgetary perspective, the additional federal spending on immigrants is projected to pale next to the increase in revenues from the millions more people working, paying taxes and buying goods and services, according to the Congressional Budget Office.

And more than a few economists say that, by easing the shortage of American workers as the U.S. population grows older and birth rates decline — particularly in California — immigrants have played a large and positive role in maintaining a healthy, growing economy.

“This is the hottest labor market that has existed in two generations,” said Michael Clemens, an economist at George Mason University who specializes in international migration. “That means there have never been as many opportunities for immigrants and natives to mutually benefit each other through economic interaction in the last half century.”

Without immigration, California’s workforce would have fallen well short of its needs, especially since the high cost of living, soaring home prices and other factors have fueled a notable outflow of population from the state.

From 2021 to 2023, the population of U.S. citizens 16 years and older living in California fell by 625,000, according to data from the U.S. Bureau of Labor Statistics, while employment increased by 725,000.

Over that period, however, the unemployment rates for native-born and foreign-born Californians fell by similar levels — an indication that immigrants are not taking away American jobs.

Moreover, the recent waves of migrants are filling lower-paying, more physically demanding positions that do not attract as many native-born Americans, at least not at the wages that are offered.

An important source of labor

“Immigrants are a really important source of the labor force for California, in the high end as well as in a lot of jobs that don’t pay as well,” said Hans Johnson, a demographer at the Public Policy Institute of California.

Separate employers’ data from the Bureau of Labor Statistics show that more than 70% of the nearly 400,000 payroll jobs added in California between June 2022 and June 2024 have been in just two industries: social assistance, such as health services for the elderly and child care; and leisure and hospitality, primarily hotels and restaurants.

Both sectors are heavily dependent on immigrant workers.

Employers in construction, another industry reliant on immigrant labor, also added thousands of jobs in that period.

“A lot of what we do is physical — you get on your knees. And Americans don’t do that,” said Tom Straus, owner of Straus Carpets. He’s been in the flooring business in the Bay Area for almost half a century and has regularly hired Latino immigrants. “The work is excellent and strenuous,” he said.

Angie, 28, and her husband and their 6-year-old arrived in Los Angeles last October from a village in Ocaña, Colombia, about 375 miles north of Bogotá. They flew from Bogotá to Cancún, Mexico, and from there to Tijuana. Then the family walked across the border checkpoint into San Diego, receiving provisional entry as migrants seeking asylum.

“It was expensive,” Angie said of the travel costs, money they borrowed from relatives. Given her uncertain status, she didn’t want to provide her last name.

At the border, Angie got a “notice to appear” at immigration court in May 2025, and she can stay in the U.S. legally until at least then. But migrants have to wait 150 days after they formally apply for asylum before they can receive employment authorization.

Angie began working almost immediately upon arrival, first at a clothing business. More recently she found work in housekeeping at a hotel in Los Angeles. Her husband works remodeling houses.

“I feel like I’ve been blessed greatly,” she said.

Angie and her family were among some 3.3 million immigrants who arrived in the U.S. last year, after net immigration of 2.6 million in 2022, according to estimates by the Congressional Budget Office. Those numbers are roughly triple the annual average in the prior decade. A similarly large number is expected this year, although immigration over the long haul is likely to return to around 1 million a year, experts say.

No one knows how many immigrants who arrive in California decide to stay here. Over the years, increasing opportunities in other states and California’s high cost of living have made it less attractive as a final destination. The latest Census Bureau figures, for 2022, show that 27% of California residents are foreign-born, about double the U.S. share.

Most of the immigration increase in recent years has been driven by foreign nationals entering illegally, asylum seekers and hundreds of thousands of people from Ukraine, Venezuela, Haiti and other countries who entered under humanitarian programs and can apply for work authorization.

Since 2021, U.S. border patrol officers have seen a surge of migrants from Mexico, Colombia, Ecuador and Peru — but also from countries such as China and India, whose citizens in the past had rarely sought to come through the southwest border, Department of Homeland Security statistics show.

Over the last few years, about 6 in 10 people crossing unlawfully have been turned away, according to an analysis of DHS data by Clemens, the George Mason professor. Most of those who are detained and not expelled are released in the U.S., many because they have shown credible evidence of fear and a desire to apply for asylum.

Then there’s a whole other large group of people who enter unlawfully and are never encountered by border patrol.

What’s behind the surge at the border?

These migrants are part of an unprecedented international movement of people to the U.S. and other rich countries. While some are fleeing political and economic crises, the relocation is actually less a result of bad conditions at home than of successful development — which brings better health, greater awareness of international options and more income for travel. That allows people to pursue opportunities for better lives in the more prosperous countries such as the U.S., experts say.

And technological advancements in many parts of the world have made the journeys more possible. Mobile phones and social media give almost anyone anywhere the basic information needed to migrate.

In his recent trip to southern China researching international migration, UCLA professor Raul Hinojosa-Ojeda met with people in Yunan province who were preparing to immigrate to the U.S. by entering through Tijuana.

“They saw it on TikTok, how to do it,” Hinojosa-Ojeda said.

The primary magnet attracting record numbers to the U.S. is jobs. Though unemployment has edged up recently as a result of government efforts to curb inflation, there are still 10 job openings for every eight unemployed workers in the U.S., according to government data. For most of the last 2½ years the U.S. jobless rate has been at or just above 3.5%, the lowest since the late 1960s.

Although the labor market isn’t as tight in California, at 5.2% in June, the unemployment rate isn’t far off historical lows for the state. And employers are still adding thousands of jobs a month, with some positions going to workers without legal status.

“They’re getting a worker. The only downside is if they get in trouble for it — and that doesn’t often happen,” said Jamie Wipf, operations manager at the International Institute of Los Angeles, a 110-year-old organization that helps refugees and other immigrants.

The nonprofit’s job placement records show many new arrivals are employed as drivers, security guards, caregivers and warehouse workers. The vast majority earn minimum wage to about $20 an hour.

Where California immigrants work

Many employers in California are reluctant to talk about immigration because of the sensitivities surrounding the politically charged issue, especially in this election year. The California Chamber of Commerce, California Business Roundtable and other industry groups declined to comment for this article.

Yet their member companies depend heavily on immigrants. Foreign-born Californians account for one-third of all workers at restaurants and warehouses; about 40% in home healthcare and child day care; almost 50% at trucking and lodging businesses; and 60% at services for landscaping and cleaning buildings, according to a Times analysis of 2022 Census Bureau data.

Are their large numbers holding back wage gains?

Economists say there is some truth to the claim that a surge of working-class immigrant labor could put downward pressure on certain jobs, such as meatpacking and gardening. But studies have shown that immigration has had no significant negative impact on wages for American workers overall.

Giovanni Peri, an economics professor at UC Davis, said large-scale immigration actually boosts productivity and demand for services, which in turn helps companies to grow and create jobs that are more likely to be taken by native-born workers, such as those in sales and management.

It’s also well documented that immigrants have higher rates of self-employment, whether that means working as an Uber driver, pushing a street food cart or launching an ambitious tech business.

Yaroslav Uchkin and his girlfriend, Ukrainian refugees, moved to Los Angeles in February after several months in the Bay Area, where they had stayed with a host family. They both have work permits. Uchkin has found part-time work as a fitness instructor; his partner works as a food server.

“I have some vision,” Uchkin said of a business he’s looking to start, making sports nutrition products. “Why I’m here in L.A.? I love the place for energy. People love sports, they want to look better.”

Uchkin and his girlfriend recently leased a one-bedroom apartment in Marina del Rey. The arrival of many new immigrants has helped reverse or, in L.A.’s case, stanch the population loss in cities that saw a pandemic-related exodus of residents, according to a study by Brookings Institution demographer William Frey.

“There’s no doubt the economy is better off because of immigration,” said Christopher Thornberg, founding partner at Beacon Economics, a research and consulting firm in Los Angeles.

“At one level, I understand people are nervous about folks coming here in an uncontrolled way,” he said, noting that he fears the anti-immigrant drumbeat is getting louder and louder.

“But our nation desperately needs people,” he said. “People have stopped having babies, and so many are going into retirement. And here we really have an opportunity to help our economy in the long run, and we are turning away from it.”

Politics

Trump Discusses Tax Cuts for New Yorkers With G.O.P. Lawmakers

Published

6 hours ago

January 12, 2025

Press Room

Trump Discusses Tax Cuts for New Yorkers With G.O.P. Lawmakers

President-elect Donald J. Trump reiterated his support for undoing a major provision of his 2017 tax law on Saturday when he told more than a dozen House Republicans at his Florida estate to come up with a plan for increasing the state and local tax deduction, according to four lawmakers who attended.

Republicans put a $10,000 cap on the deduction, often called SALT, during Mr. Trump’s first term to help cover the cost of the broader 2017 tax law they passed along party lines. The change upset lawmakers from both parties in high-tax states like New York and New Jersey, who have since made it a central political promise to restore a valuable deduction for residents in their states.

The yearslong quest to restore the deduction — or at least increase its limit — got a boost during the presidential campaign when Mr. Trump said he would “get SALT back.” But the House Republicans demanding an increase to the limit have not yet agreed among themselves on the details.

Some have called for raising the limit for the deduction as high as $200,000. Others have more modest ambitions, including a smaller increase in the deduction’s limit that would be paired with gradual hikes over time that match the pace of inflation. Right now, the $10,000 cap applies to both individuals and married couples, and the group seems in agreement that couples should take a larger deduction than individuals.

At the meeting on Saturday, House Republicans from New York, New Jersey and California offered a variety of ideas to Mr. Trump about how to address the issue, according to the attendees. Among the concepts discussed was the possibility of persuading local leaders to hold off on tax increases in return for a higher deduction for their residents.

“Maybe we increase the deduction, but maybe the deduction goes even higher if your state freezes or lowers the tax rate,” said Representative Nicole Malliotakis, a New York Republican and member of the Ways and Means Committee who attended the meeting. “These are all ideas we are entertaining.”

Mr. Trump largely listened to the House Republicans, who were served coconut shrimp and Trump-branded bottled water during the hourlong meeting, and asked the group to reach a consensus, the attendees said. Any proposed change would also need nearly unanimous support from other congressional Republicans, many of whom are skeptical of providing tax relief to largely high-income residents of states governed by Democrats.

Lifting the cap on the deduction is expensive, and Republicans are already grappling with the vast cost of the tax bill they plan to pass this year. Lawmakers have explored the possibility of limiting the ability of businesses to deduct state and local taxes from their federal bills to try to cover the cost of any changes.

“It can’t be unlimited, and we still need a cap,” said Representative Jeff Van Drew, a New Jersey Republican who attended the meeting. “We have to find that sweet spot.”

Politics

Trump tasks blue state Republicans with 'homework' as GOP plots massive conservative policy overhaul

Published

7 hours ago

January 12, 2025

Press Room

Trump tasks blue state Republicans with 'homework' as GOP plots massive conservative policy overhaul

GOP divided over lifting SALT cap

Rep. Mike Lawler, R-NY, joins ‘Sunday Morning Futures’ to discuss the Trump meeting with blue state Republicans over lifting the SALT cap and NYC congestion pricing.

President-elect Donald Trump is giving Republicans his blessing to negotiate on a key tax that could prove critical to the GOP’s negotiations for a massive conservative policy overhaul next year.

Trump met with several different groups of House Republicans at Mar-a-Lago over the weekend, including blue state GOP lawmakers who make up the House SALT Caucus – a group opposed to the current $10,000 cap on state and local tax (SALT) deductions that primarily affect urban and suburban residents in areas with high income and property taxes, such as New York, New Jersey, and California.

“I think it was productive and successful,” Rep. Nicole Malliotakis, R-N.Y., said of the meeting. “The president supports our efforts to increase the SALT deduction. He understands that mayors and governors in blue states are crushing taxpayers and wants to provide relief from the federal level.”

JOHNSON BLASTS DEM ACCUSATIONS HE VOWED TO END OBAMACARE AS ‘DISHONEST’

President-elect Donald Trump told New York Republicans he would work with them on a number of priorities (Chip Somodevilla/Getty Images)

But Trump also signaled he was aware of the opposition from others in the House GOP conference, particularly rural district Republicans, who have viewed SALT deductions as tax breaks for the wealthy. Before the cap was imposed in 2017, there was no limit to how much state income and local property taxes people could deduct from their income when filing their federal returns.

“He gave us a little homework to work on, a number that could provide our middle class constituents with relief from the high taxes imposed by our governor and mayor, and at the same time, you know, something that can build consensus and get to [a 218-vote majority],” Malliotakis said.

“I think we pretty much know that it’s not going to be a complete lifting of the SALT cap. There’s not an appetite within Congress or even among American taxpayers to lower taxes for the ultra-wealthy.

“Our efforts are really targeted to middle-class families, and that’s what we’re focused on in trying to achieve the right balance.”

The current SALT deduction cap has been opposed by New York and California lawmakers for much of its existence, since being levied in Trump’s Tax Cuts and Jobs Act (TCJA).

RFK JR. TO MEET WITH SLEW OF DEMS INCLUDING ELIZABETH WARREN, BERNIE SANDERS

Rep. Nicole Malliotakis told Fox News Digital that Trump would work with New York Republicans on congestion pricing (Drew Angerer/Getty Images)

Trump suggested he would change course during his second administration as early as September last year, when he posted on Truth Social that he would “get SALT back, lower your taxes, and so much more.”

The discussions are part of Republicans’ wider talks about passing a massive fiscal and conservative policy overhaul via a process known as “reconciliation.”

By lowering the Senate’s threshold for passage to a simple majority instead of two-thirds, the process allows the party in control of both houses of Congress and the White House to pass certain legislation provided it deals with budgetary and other fiscal matters.

Some pro-SALT deduction Republicans, like Rep. Mike Lawler, R-N.Y., had signaled they could withhold support from the final bill if the cap was not increased.

“The only red line I have is that if there is a tax bill that does not lift the cap on SALT, I would not support that,” Lawler told Fox News’ Sunday Morning Futures.

Lawler also said Trump agreed that SALT deduction caps needed to be raised.

House Republicans have virtually no room for error with a razor-thin majority from Trump’s inauguration until likely sometime in April.

Rep. Mike Lawler said SALT deduction caps were a “red line” for his support on a budget reconciliation bill (Tierney L. Cross)

Meanwhile, Trump also told New York Republicans that he would help them fight their state’s controversial congestion pricing rule that levies an added cost to drive in parts of Manhattan.

“He understands how unfair this is and how it would impact the city’s economy and the people we represent and so we’re currently working with him on legal options to reverse the rubber stamp of the Biden administration,” Malliotakis said. “If there’s a legal option, if there’s a legal option for him to halt congestion pricing, he will.”

“You have, you know, cops, police, firefighters, nurses, the restaurant workers that have to go in at odd hours, and they drive because they don’t feel that the transit system is clean or safe.”

Congestion pricing took effect in New York City earlier this month.

Fox News Digital reached out to the Trump transition team for comment on this weekend’s meeting.

Elizabeth Elkind is a politics reporter for Fox News Digital leading coverage of the House of Representatives. Previous digital bylines seen at Daily Mail and CBS News.

Follow on Twitter at @liz_elkind and send tips to elizabeth.elkind@fox.com

Politics

Newsom suspends landmark environmental laws to ease rebuilding in wildfire zones

Published

8 hours ago

January 12, 2025

Press Room

Newsom suspends landmark environmental laws to ease rebuilding in wildfire zones

Landmark California environmental laws will be suspended for wildfire victims seeking to rebuild their homes and businesses, according to an executive order signed Sunday by Gov. Gavin Newsom.

Requirements for building permits and reviews in the California Environmental Quality Act and the California Coastal Act — often considered onerous by developers — will be eased for victims of the fires in Pacific Palisades, Altadena and other communities, according to the order.

“California leads the nation in environmental stewardship. I’m not going to give that up,” Newsom told Jacob Soboroff on NBC’s “Meet the Press.” “But one thing I won’t give into is delay. Delay is denial for people: lives, traditions, places torn apart, torn asunder.”

Dan Dunmoyer, president and chief executive of the California Building Industry Assn., said the governor’s action represents an early and strong statement about the future of these areas. Newsom is making clear, Dunmoyer said, that the state will encourage homeowners to go back to their neighborhoods rather than deem development there too risky.

“He’s put a marker down to say we’re going to rebuild these communities,” Dunmoyer said.

Waivers of the environmental quality act, known as CEQA, and the Coastal Act could shave years off the process for homeowners in the Palisades, he said, but building permits issued by local governments represent another major hurdle.

“Those two banner ones are important,” Dunmoyer said, referring to the state laws, “but if the locals don’t come up with an expedited process, that’s where it could get stuck.”

Newsom’s order calls for the state housing department to work with affected cities and the county to develop new permitting rules that would allow for all approvals to be issued within 30 days.

In the wake of the fires, housing analysts have renewed calls for the city of Los Angeles to speed up its processes. A 2023 study found that the average unit in a multifamily property in the city took five years to complete, with a substantial portion of that time related to bureaucratic approval.

Mayor Karen Bass has acknowledged the problems and pledged that the city will accelerate permitting.

“We are going to clear the red tape and unnecessary delays and costs and headaches that people experience in ordinary times so that we can rebuild your homes quickly,” Bass said at a news conference Thursday.

Bass reiterated the promise at a news conference Sunday morning, applauding the governor’s action, and said she plans to release details on the effort this week. L.A. County Board of Supervisors Chair Kathryn Barger, who represents Altadena, similarly lauded the governor’s executive order.

“I want to thank the governor for hearing my request and taking swift action to ensure that our residents will not be burdened by unnecessary requirements as they begin the process of recovery and rebuilding,” said Barger, a Republican.

However, many GOP members across the state said Newsom’s order was too little, too late.

“Wildfire victims deserve much more from Gavin Newsom. When his track record includes lying about and underfunding wildfire prevention efforts, he owes Angelenos answers on how he and local Democrat leaders could have been so unprepared for these devastating wildfires,” said California Republican Party Chairwoman Jessica Millan Patterson. “No more blame game and excuses. We need accountability from this governor, and we need it now.”

Environmentalists also noted that the governor’s executive order restates an existing provision in the Coastal Act that provides exemptions for fire rebuilds.

The California Coastal Commission, which is tasked with coordinating with local officials in enforcing the Coastal Act, noted last week that the state law already clearly lays out that reconstruction of homes, businesses and most other structures destroyed by a disaster are exempt from typical coastal development permits — as long as the new building is sited in the same location and not more than 10% larger or taller than the destroyed structure.

In the 2018 Woolsey fire, which devastated areas in and around Malibu, the commission coordinated with city and county officials to help homeowners rebuild. Coastal officials also noted that over the years, following other devastating natural disasters, the commission has processed hundreds of “disaster rebuild waivers” in other coastal areas that are directly regulated by the commission.

“When the time comes to rebuild, both the Coastal Act and the Governor’s Executive Order provide a clear pathway for replacing lost structures quickly and easily,” Kate Huckelbridge, the commission’s executive director, said in a statement. “Our hearts go out to all the residents of the L.A. area whose homes and communities have been destroyed by these horrific fires.”

President-elect Donald Trump and other conservatives have castigated Newsom and other Democratic leaders in California for embracing environmental policies that they argue laid the groundwork for this month’s historic destruction. Calling Newsom “incompetent,” Trump said he should resign, and made false statements about water being redirected to protect small fish and about Federal Emergency Management Agency policy.

“The fires are still raging in L.A. The incompetent pols have no idea how to put them out,” Trump wrote Saturday night on Truth Social, his social media platform. “Thousands of magnificent houses are gone, and many more will soon be lost. There is death all over the place. This is one of the worst catastrophes in the history of our Country. They just can’t put out the fires. What’s wrong with them?”

Trump’s transition team did not respond to requests for comment on Saturday.

Newsom, during the NBC interview, said he had asked the incoming president to come view the devastation in person, as Barger did Saturday.

“We want to do it in the spirit of an open hand, not a closed fist. He’s the president-elect,” Newsom said. “I respect the office.”

While noting that many of the buildings that survived the fires were more likely to be built under modern building codes, Newsom said he was worried about the amount of time it would take to rebuild. So his executive order eliminates some CEQA requirements, modifies Coastal Act provisions and ensures property tax assessments are not increased for those who rebuild.

CEQA was signed into law by then-Gov. Ronald Reagan in 1970 amid the burgeoning environmental movement. The Coastal Act was created after a landmark voter proposition in 1972 that was led by a fervent statewide effort to save the coast from unchecked development and devastating oil spills like the 1969 disaster in Santa Barbara that was considered the “environmental shot heard round the world.”

Both have faced challenges for decades, and governors of both parties have argued for more than 40 years that CEQA needs to be reformed. Several of the act’s requirements were temporarily suspended by an executive order issued by Newsom during the pandemic. He argues that now is the time again.

Asked on the news program whether this month’s wildfires are the worst natural disaster in the nation’s history, Newsom noted that recent fires had resulted in a greater loss of life but said, “I think it will be in terms of just the costs associated with it in terms of the scale and scope.”

He called for a California version of the Marshall Plan, the American effort to rebuild Western Europe after World War II.

“We already have a team looking at reimagining L.A. 2.0,” he said, “and we are making sure everyone’s included, not just the folks on the coast, people here that were ravaged by this disaster.”