Idea of the Day: Passing the DREAM Act is Good Economic Policy
Until now, much of the debate surrounding the Development, Relief, and Education for Alien Minors Act, or DREAM Act—a bill to provide a pathway to legal status for eligible young people who were brought here as children and who complete high school and some college or military service—focused on legal, ethical, and logistical concerns. But there are other important benefits of enacting the DREAM Act, most importantly the boost to the economy.
The United States would grant a pathway to legal status to an estimated 2.1 million eligible youth in our country by passing the DREAM Act. Overall, the passage of the DREAM Act would add $329 billion to the U.S. economy and create 1.4 million new jobs by 2030, demonstrating the potential of the proposed law to boost economic growth and improve our nation’s fiscal health.
Enabling these 2.1 million eager-to-be-Americans to contribute to building the American Dream would deliver a double boost to our economy. First, enacting the law would provide an incentive for their further education because for most of those who would be eligible the legalization provisions can only be attained through completion of high school and some college. Receiving more education opens access to higher-paying jobs, enabling these undocumented youth to become much more productive members of our society. Second, gaining legal status itself translates into higher earnings for these youth since legal status allows DREAMers to apply to a broader range of high-paying jobs rather than having to resort to low-wage jobs from employers who are willing to pay them under the table.
The U.S. economy is not a zero-sum game and increased earnings from DREAMers create greater demand for services among the most important drivers of job growth in the country, expanding opportunities for all Americans. There are also very good reasons to think that the DREAMers will not be displacing American workers.
First, many economists find that immigrants tend to complement the skills of native workers rather than compete with them, especially as immigrants move up the education and skills chain. Increasing the education of immigrant workers would therefore decrease the competition between DREAMers and the native-born.
Second, research shows that an increase in college-educated immigrants directly increases U.S. gross domestic product—the largest measure of economic growth—which correlates to more jobs for American workers. In the 1990s, for example, the increase in college-educated immigrants was found to be responsible for a 1.4 percent to 2.4 percent increase in U.S. GDP. Finally, by giving legal status to DREAMers, fewer employers would be able to pay workers under the table and more would have to abide by a system that is fair to all workers.
For more on this topic, please see:
- The Economic Benefits of Passing the DREAM Act by Juan Carlos Guzmán and Raul C. Jara
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