Arizona Shows Economic Benefits of Immigration Reform

February 16, 2016 | PFIR

Several presidential candidates promise to crack down on illegal immigration and deport millions of illegal aliens. Their plans beg the question: what would a mass exodus of illegal workers do to the economy?

Corporate interests predict disaster. But a new analysis of Arizona’s economy in the aftermath of that state’s strict anti-illegal immigration reforms tells a different story — one that should give down-on-their-luck American laborers something to smile about.

By massively reducing its illegal alien population, Arizona boosted American workers’ wages and relieved a major burden on its taxpayers. Other states can achieve the same positive results by following suit.

Arizona’s illegal alien population peaked at 500,000 in 2007 — the same year Arizona passed the Legal Arizona Workers Act, which requires employers to use the free, online E-Verify system to confirm that their workers have legal status. In 2010, Arizona stepped up its efforts to deter illegal immigration with S.B. 1070, a law which made it easier for police to apprehend illegal aliens.

These measures, combined with the recession, compelled many illegal workers to return to their home countries. The number of illegal aliens living in Arizona has declined by about 40 percent since 2007.

Arizona’s total economic output shrank as a result. That’s to be expected — fewer workers means fewer products manufactured and fewer services offered.

But as presidential candidate Bernie Sanders has noted, GDP growth is meaningless if it doesn’t benefit everyday Americans. Indeed, almost 98 percent of the “increase in GDP [resulting from immigration] goes to the immigrants themselves in the form of wages and benefits,” according to Harvard economist George Borjas.

Much of the rest goes to business owners — corporate elites who aren’t struggling to get by.

The exodus of illegal workers was a boon to everyday Arizonans. Many Americans filled the jobs vacated by departing illegal aliens, and reducing the supply of blue-collar workers caused wages to increase — 15 percent for farmworkers and 10 percent for construction workers. One landscaping firm boosted wages 60 percent to attract workers.

Cracking down on illegal immigration also benefited Arizona taxpayers, who no longer had to spend hundreds of millions supporting illegal workers and their families. Some estimate that the decline in Arizona’s illegal alien population saves the state $350 million annually on education expenses alone. Taxpayers save tens of millions more in reduced healthcare and incarceration costs.

Deterring illegal immigration has helped Arizona workers and taxpayers. The rest of the country should take note of the state’s successes.

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One problem is that some or all of the (GOP) candidates who “promise to crack down on illegal immigration”, also want to drastically increase the number of foreign workers admitted to the U.S. It matters little whether the foreign workers are here legally or illegally if there are so many of them that wages are depressed.

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