Ryan Edwards, Queens College, CUNY; Francesc Ortega, Queens College, CUNY

The article provides a quantitative assessment of the economic contribution of unauthorized workers to the US economy and the potential gains from legalizing their situation. The study shows that the economic contribution of these workers to the US economy is substantial, about 3% of the private-sector GDP annually, which translates into a gain of $5 trillion for a period of 10 years.

The study reveals that the economic contribution to the industry growth of unauthorized workers is unequal and it may reach 8-9% of the value-added in Agriculture, Construction and Leisure and Hospitality. Their contribution to the economy is larger in states where they are a larger share of employment, amounting to 7% of California’s GDP. Due to their more limited opportunities caused by their status, the unauthorized workers appear to have a lower productivity level as compared to legal employees having similar skills. In the event that undocumented immigrants are granted legal status, the paper estimates that their contribution will grow to 3.6% of GDP. The growth will stem from the enhanced opportunities availed to these workers, which will raise their productivity and wages. The gains from legalization could be magnified further if workers decide to invest more in acquiring new skills to take advantage of the improved opportunities in the labor market.

Paper