Study says NC's immigrants have positive economic impact

by David Ranii, News and Observer, April 15, 2014.

A new study by researchers at UNC-Chapel Hill found that North Carolina’s immigrant population has a positive impact on the state’s economy, with immigrants contributing $23,371 on a per-capita basis.

“There are value adds to North Carolina immigrants,” said researcher Stephen J. Appold of UNC’s Kenan Institute of Private Enterprise and co-author of the study. “They have boosted economic growth. They have helped prosperity through the boom times ... and, a little bit to our surprise, also during the bust.”

That finding is sure to add fuel to the highly emotional debate over immigrants, as it contradicts the often-expressed argument that those who migrate to the U.S. from foreign countries are a drain on the economy.

The U.S. Senate passed an immigration reform bill last fall, but the debate in the House has bogged down over whether undocumented immigrants should have a path to citizenship.

Roughly 750,000 immigrants live in North Carolina. The UNC study added up the immigrants’ consumer spending and their ripple effect, plus the taxes they pay, then subtracted the public services they consume to come up with an estimated “net benefit.” Commissioned by the N.C. Bankers Association, the study was released Tuesday morning at a news conference at the Sheraton Imperial hotel in Durham. About 100 people attended, including a bevy of bankers and public officials.

The study updated and expanded a 2006 study that focused solely on Hispanics. The latest study covers all immigrants, irrespective of where they migrated from and regardless of their status – naturalized citizen or noncitizen, in the country legally or illegally.

Hispanics have a less positive impact on the state’s economy than immigrants as a whole – $10,418 on a per-capita basis, less than half the net benefit of immigrants overall.

Similarly, the immigrants’ overall impact on taxes – that is, the taxes paid by immigrants minus the tax dollars needed to provide them with services – amounts to a surplus of $48 million, or $42 per immigrant. But Hispanics’ tax impact produces “a net fiscal loss to the state of $462 million or about $578 per Hispanic resident,” according to the study.

The difference stems largely from the cost of educating the children of Hispanic immigrants, Appold said.

Jobs issue not addressed

The negative tax impact of Hispanics raised consternation among some in the audience that those numbers would be a focal point for immigration opponents.

“My concern is that people might take that as a negative thing and stop there, without thinking about the investment,” Marco A. Zarate, president of the N.C. Society of Hispanic Professionals, said after the presentation. “Investment in a Latino student is investing in North Carolina.”

Maria T. Unger Palmer, a Chapel Hill council member, had a similar reaction.

“The more we invest, the better off our state will be in 20 years,” she said.

The study doesn’t address whether immigrants take jobs away from the native-born or depress overall wages.

But Appold said that “the primary group that immigrants compete with is other immigrants.”

And, he added, a study of construction workers found that immigrants didn’t depress wages for the native-born because they were able to move into more highly skilled, better-paying construction jobs as the immigrants were hired for entry jobs.

Many jobs held by immigrants are “3-D jobs” – that is, “difficult, dirty and dangerous,” said co-author James H. Johnson Jr., a professor at UNC’s Kenan-Flagler Business School.

Although the state’s immigrants have higher poverty rates than the native-born, Johnson said, “They came here to work. ... They are more likely to be the working poor rather than the jobless poor.”

“That’s a critical consideration in public policy debates,” Johnson added. “One is considered to be deserving and one is considered to be undeserving.”

More Asian immigrants

The average immigrant in North Carolina earns $58,899, which is lower than the $63,197 average of the native-born. However, Johnson said, the average masks the fact that immigrants who are naturalized citizens actually earn more than the native-born: $77,253.

As of 2012, nearly 60 percent of the state’s foreign-born population came from Latin America. But in recent years immigration from Latin America has tapered off, giving way to “a boom” in migration from Asian countries, Johnson said.

In addition, “the majority of immigrants arriving since 2010 are well-educated,” Johnson said.

The study’s estimate of the economic impact of immigrants includes the jobs created by immigrants’ consumer spending: an estimated 171,000 jobs.

Overall, immigrants’ consumer spending contributed $19.76 billion to the state economy in 2010, according to the study.

Among the attendees of Tuesday’s news conference was U.S. Rep. Renee Ellmers, a Republican from Dunn whose primary opponents have criticized her stance on immigration. She said afterward that she was there on a fact-finding mission.

“The positive impact on North Carolina that the immigration population brings to us is something we all have to consider,” she said. “As you know, it’s a very emotional issue. That is what I hear from my constituents, and I understand that completely.”