Immigration as the Current Main Driver of Economic Growth in the U.S.

By Ernesto Castañeda, Edgar Aguilar, and Natalie Turkington

A new report from CLALS and the Immigration Lab finds that recent immigrants are a key driver of economic growth in the United States.

The report presents an original calculation that finds that only in 2022:

  • Immigrants who sent money home contributed over $2.2 trillion dollars to the U.S. economy.
  • This contribution by migrant labor constitutes about 8% of the U.S. GDP.
  • Remittances represent just 4% of the total output generated by immigrants, even if they add up to $81.6 billion annually, disputing the narrative that immigrants drain the U.S. economy.


Immigrants who remit contribute around $2.2 trillion annually to the U.S. economy. Despite concerns that remittances drain U.S. dollars, they only represent 4% of immigrants’ total contributions. This estimate is based on credible sources indicating that 17.5% of immigrants’ income is sent as remittances and considering a combined yearly salary of approximately $466.5 billion.  Using data from the World Bank, the Association for Central Banks of Latin America, the U.S. Census Bureau, and the Bureau of Labor Statistics, however, this is just a good approximation to quantify some of the benefits of migration. Immigrants’ contributions to the economy are greater as not all send remittances through formal channels. Additionally, it overlooks the economic growth immigrants stimulate by spending their wages in the U.S., creating demand, and generating jobs. Not to say anything about the human, cultural, culinary, and creative contributions. Below are more details about this novel estimation and projections of future contributions by immigrants to the U.S. economy.

The Congressional Budget Office’s Demographic Outlook 2024-2054, which has gotten some deserved media attention, estimates that in 2034 the U.S. economic output will be $7 trillion larger due to new immigration. Tax revenues would also be higher and the deficit lower because of immigration all else equal.

The quote from the CBO Director’s press release is, “in our projections, the deficit is also smaller than it was last year because economic output is greater, partly as a result of more people working. The labor force in 2033 is larger by 5.2 million people, mostly because of higher net immigration. As a result of those changes in the labor force, we estimate that, from 2023 to 2034, GDP will be greater by about $7 trillion and revenues will be greater by about $1 trillion than they would have been otherwise.”

We estimate immigrants’ contribution to the U.S. economy between 2023 and 2034 will be greater. Using the same immigration estimates as the Congressional Budget Office’s (see graph below), we calculate new immigrants have the potential to elevate the U.S. economic output by a staggering $17 trillion just in 2034.

Net population growth is through immigration.

Source: Congressional Budget Office interactive graph here.

However, if the number of new immigrants and asylum seekers continues at the same pace as in estimated for 2024, 3.3 million per year (10,000 per day as happened in December of 2023), we calculate that the U.S. would enjoy an increased economic output of over $37 trillion just in 2034.

As the Economic Policy Institute writes, “The unemployment rate for U.S.-born workers averaged 3.6% in 2023, the lowest rate on record. Obviously, immigration is not causing high unemployment among U.S.-born workers.” They further write, “immigrants that make up 18.6% of the U.S. labor force are playing key roles in numerous industries and are employed in a mix of lower, middle, and higher-wage jobs. And as the Congressional Budget Office recently reported, immigration is contributing to strong economic growth—with future immigration forecasted to boost real gross domestic product by 2% over the next 10 years—as well as increasing government revenue. Immigrants are also complementing U.S.-born workers by contributing to overall population and workforce growth. The U.S. Census Bureau projects that if the U.S. were to have lower-than-expected immigration levels, the population would begin to decline in 20 years, and if there were suddenly zero immigration, the population would begin to decline next year, deeply harming economic growth.”

A Washington Post article states that around 50% of the growth in the labor market in 2023 was due to foreign-born workers. The same was the case in the 1990s.

In 2021, 45 million immigrants lived in the United States, accounting for 14% of the country’s population. Immigrants are integrated into American social, economic, cultural, and political life. The Immigrant Research Initiative calculates that “Immigrants account for 17 percent of the U.S. economic output (GDP), even higher than their share of the population. The United States has a $19.6 trillion economy according to the Bureau of Economic Analysis 2021 statistics, which means immigrants are conservatively responsible for $3.3 trillion of economic output.” This supports our calculation of around 2.2 trillion only from immigrants who send money abroad because many do not send remittances.

Estimates and projections vary, but what is clear is that there would be no economic growth without recent immigrant arrivals. If immigration (of all types) decreases in the following years, economic growth will most likely plummet, and inflation will rise. Furthermore, this does not only apply to the United States but to other countries as well.

You can find coverage of the report in Spanish here:

“Immigracion y Economia en EE.UU.” RTVE 24h.

“Los hispanos y el mercado laboral en EE. UU.” Y Esto No es Todo podcast on YouTube.

“Ernesto Castañeda y el mercado laboral en EE.UU.” RTVE audio.

Ernesto Castañeda is the Director of the Center for Latin American and Latino Studies and the Immigration Lab.

Edgar Aguilar and Natalie Turkington are research assistants at the Center for Latin American and Latino Studies.

Full report here.

Ecuador: The Formation of Gangs in Prison Systems

By Erica Criollo

January 17, 2024

Solidarity rally in Queens, New York by members of the Ecuadorian diaspora. Photo by Erica Criollo 

On January 7th, 2024, José Adolfo Macías Villamar, alias“Fito,” the leader of one of Ecuador’s most prominent gangs, was found missing from his luxury prison cell the day he was meant to be transferred to a maximum-security prison to be held in isolation.

While Macías began his 34-year sentence in 2011, he remained the leader of the criminal gang, Los Choneros, due to their longstanding influence over government officials and extensive illicit drug networks. Following his escape, the country descended into chaos resulting in President Daniel Noboa declaring that the country was under “armed internal conflict” to mitigate gang wars and the killings of police officers.

This presidential declaration has prompted questions as to how Ecuador could have experienced such a sudden upsurge in gang violence. Along with government corruption, the escalation can be traced to the gradual formation of gangs dominating prison systems over several years. 

 In 2003, Los Choneros, who are associated with Mexican and Colombian cartels, took control of the drug trafficking route in the province of Manabí, Ecuador, from where drug shipments were sent to Mexico, the United States, and several European countries. Transnational networks and external groups engaged in the illicit drug trade utilized Ecuador’s coasts, leveraging its access to major shipping routes and ports to transport illicit drugs across international borders. 

Furthermore, Ecuador’s adoption of the U.S. dollar, coupled with inadequate enforcement and prevalent corruption, has facilitated money laundering by drug traffickers through industries such as real estate, illegal mining, and the illicit timber trade. This impacted the way corruption played a role in the country’s efforts to combat such illicit activities. 

When Former President Rafael Correa took office in 2007, he gained public favor through his initiative to remove the United States from the Manta military base from which the U.S. has been controlling anti-drug efforts with targets against the Colombian illicit drug trade since 1999.

However, following the U.S. withdrawal from the Manta military base, the country witnessed a worsening of drug trafficking. Former President Correa failed to stop the activities of groups like Los Choneros and other Mexican cartels, allowing the unhindered transportation of drugs to and from Ecuador.

Before Macías, Los Choneros was led by Jorge Luis Zambrano, alias “Rasquiña,” who, while incarcerated, directed orders alongside arrested gang members. By 2010, the group had transitioned to operating within prison systems and communicating with members on the outside. This operational shift steered the group away from international drug trafficking, focusing instead on micro-trafficking, contract killings, extortion, and contraband activities.

Emerging factional gangs, including Los Choneros, Gorras, Lagartos, Latin Kings, and the Cubanos, have become more extensive and aggressive, leading to deadly conflicts in prisons. In 2019, a brutal fight claimed the lives of several inmate gang members at Penitenciaria del Litoral, and in 2021, a prison riot resulted in the deaths of 119 inmates in the same facility. These deviations of gangs were also a result of government initiative in dismantling gang groups through the transfer of leaders between prisons, but it only multiplied the presence of gang wars.

Following Zambrano’s death in 2020, Macías obtained leadership, triggering an uproar of chaos and gang violence across the country as gang leaders fought to dominate. Despite being in prison, Macías remained in control. For him, communication with members was not an obstacle, as several reports indicate Macías’ prison cell had plugs to charge his cell phone and an internet router. Macías was also open to sharing his lavish living space on social media, regularly throwing parties, and having access to weapons, appliances, liquor, jewelry, and ceramics.

Ecuador has experienced a long trajectory of government corruption which has led to an escalation in gang formation and violence in prison systems. With Macías’ most recent escape, the country has been submitted to crazed gang members responsible for several car bombings, kidnappings, and slayings of prison guards and innocent civilians. In response to President Daniel Noboa’s crackdown on gang members in prisons, gang leaders on the outside have resorted to hostage-taking, capturing military and prison guards. These captives are coerced into recording messages, pleading with President Noboa to halt military operations in prisons and cease the killing of gang members. The objective behind these threats is to secure the gangs’ dominance within prisons and ensure the unrestricted proliferation of gang members. 

In one such video shared on Facebook, a gang member asserts, “Just as you safeguard the right to life of Ecuadorian citizens, we too have the right to live…we are not afraid of your tactics.” In essence, Ecuador is confronted with a formidable coalition of gangs wielding enough power to subvert the law and pursue their objectives, fueled by their substantial numbers and collective readiness to act in unison to carry out attacks. 

Currently, President Noboa’s plan to overpower gang violence is to enforce stricter regulations in prisons. However, this raises concerns for Ecuadorian citizens alarmed by several online videos featuring hostages pleading with the government for compliance to spare their lives. As events unfold, President Noboa’s actions will require careful consideration to ensure that no more civilian lives are endangered and to respect the human rights of all people. 

*Erica Criollo is a Graduate Research Assistant of the Immigration Lab at American University. 

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Blinken and Mayorkas visited Mexico to Discuss Migration

By Ernesto Castañeda

January 11, 2024

Republicans in Congress are denying funding to Ukraine and Israel over migration and border security, but the premises and assumptions used to discuss the issue fail to take the following elements into account.

It is hard to determine if numbers are really without precedent. There has been a change in that immigrants come and turn themselves in to try to come in with a legal immigration status, such as through asylum or the regularization programs available to Ukrainians, Afghans, Cubans, Haitians, Venezuelans, Nicaraguans, and other groups. In previous decades, many low-skilled workers knew there were no avenues to enter legally and would try to pass undetected and live undocumented in the United States. That is less common today for so-called low-skilled, recently arrived immigrants. So, an imaginary example would be to count people who once would mainly drive to New York City for the holidays and then compare them to a time when most people would arrive via plane. It would be easier to count the people arriving on planes, but that would not necessarily mean that there are more people arriving now by plane than the ones who arrived driving in the past. 

Historically, numbers are not comparable because, before Title 42, apprehensions were counted versus encounters afterward. Previously, most apprehensions would happen inside the U.S., while today, most people present themselves in groups and in a visible manner at ports of entry, along the physical border, or in front of the border wall. Another important difference is that in the past, undocumented workers relied on established family members and networks to get provisional housing and food and find a job. Many recent arrivals may not have close people in the United States and are actively asking for temporary housing and food from city governments. The U.S. does this for refugees and has done it in the past for Cubans and others escaping repressive regimes. Research and history show that these short-term expenses have been good investments, given that refugees and immigrants are more likely than U.S.-born individuals to work, start businesses, and be innovative leaders. Republicans in Congress have denied requests from the White House to provide funding to cities to cover some of these costs.

Some propose detention as deterrence, but prolonged detention in the United States is very expensive and mainly benefits the companies or workers providing and managing detention centers.

A misconception repeated in the media is that most people are immigrating illegally. That is technically incorrect because people are presenting themselves to immigration authorities. Many migrants are applying to legal programs, asking for asylum, or being placed in deportation proceedings.

The situation that we are seeing at the border and some of the solutions proposed indicate some important points that have been rarely discussed,

1) Border walls do not work. Smugglers can cut them, and people can walk around them or come in front of them on U.S. territory. 

2) People are turning themselves in, so contrary to what Trump said recently, authorities know where people are from and where they are going. They have notices to appear in immigration court, and they register an address in order to receive notices and updates if they want to continue with their asylum process and regularize their status. In the past, a great majority of people go to their migration court hearings.

3) CBP One appointments are too cumbersome to make, and there are not enough slots available, so people are showing themselves at ports of entry and between them.

4) The parole program for Haitians, Cubans, Venezuelans, and Nicaraguans is working to create a more rational and orderly process. Taking the program away —as Republicans in the Senate want—would make things worse. 

5) Putting more pressure on Mexico to deport more people and stop them from getting to the border is unsustainable. Mexico cannot manage the issue by itself unless it gets pressure and funding from the U.S. and international organizations, like Colombia does, to establish immigrant integration programs for immigrants who want to stay in Mexico, and it provides paths to citizenship for them. 

Thus, Blinken, Mayorkas, and their companions and team’s visit to Mexico is important. Mexico has been a willing partner, agreeing to take people from third countries under the Remain in Mexico and Title 42 programs, but those programs could only work temporarily. Mexico has also increased the number of deportations. However, deportation only works if people are unwilling to try multiple times. Increasing immigration surveillance, deterrence, and deportation does make arriving in the U.S. harder. It also makes it more expensive and thus attractive for organized crime to get involved in it as a business, thus getting more people to the border once they figure out the business model and logistics even with new policies in place. 

Mexican President Andrés Manuel López Obrador has asked for a regularization of U.S. relations with Cuba and Venezuela. There have been positive steps with Venezuela already. This could be a good opportunity to remove Cuba from the list of states sponsoring terrorism, which would reduce some of the emigration pressure in Cuba. 

Mexican authorities have disbanded many caravans and slowed the trek of thousands of migrants. Nevertheless, people who are escaping violence and persecution or have sold everything will try to get to the United States. 

Long-term ways to address the root causes of migration are to continue providing international aid and supporting democratic institutions. One has to keep in mind human rights. The Mexican Supreme Court of Justice has found that profiling people suspected to be migrants in buses to be unconstitutional. To engage the Mexican Army is not the solution either.

The silver lining is that despite the images we see in the news and seasonal peaks, it is not as if all the world is on the way to the U.S.-Mexico border. Most people want to stay home.

Congresswoman Delia C. Ramirez (IL-03)

Congresswoman Delia C. Ramirez (IL-03) presenting immigration policies the Congress could be working on instead.

In the January 10 hearing towards impeaching DHS Secretary Alejandro Mayorkas, Republicans repeated many myths, cliches, and anti-immigrant talking points but did not propose any sensible solutions. It was remarkable that Democrats in the committee saw the political nature of the exercise, and many offered actual solutions to improve the situation at the border and inside the United States in a way that makes the immigration and asylum processes more humane and above ground.

Ernesto Castañeda is the Director of the Center for Latino American and Latino Studies and the Immigration Lab at American University.

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