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The State Economic Benefits of Passing the DREAM Act

Ruben Bernal, who recently graduated from San Jose State University, rallies for the Dream Act in downtown San Jose.

SOURCE: AP/Paul Sakuma

Ruben Bernal, who recently graduated from San Jose State University, rallies for the Dream Act in downtown San Jose.

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The Development, Relief, and Education for Alien Minors Act—or DREAM Act—would provide a pathway to legal status for an estimated 2.1 million undocumented youth currently living in our country. For the nation as a whole, passage of the DREAM Act will add a total of $329 billion to the economy by 2030, support the creation of 1.4 million new jobs, and generate more than $10 billion in increased revenue for the federal government.

But since DREAM Act beneficiaries are distributed unevenly across the nation, certain states will end up with an even greater economic boost. California, for example, the state with the largest number of DREAMers—more than 550,000—stands to gain almost $100 billion in economic activity, while Texas stands to gain more than $66 billion.

But even states with fewer DREAMers benefit significantly by passage of the act. Maryland, with close to 36,000 DREAMers, gains almost $5 billion in economic activity, which will support the creation of over 19,000 new jobs. No matter how many or how few DREAMers per state, all 50 states and the District of Columbia will benefit economically from passage of the DREAM Act.

Click here to see the full data on the economic impact of the DREAM Act for each of the 50 states and the District of Columbia.

The map below shows the economic gains through 2030 from passing the DREAM Act—including the numbers of DREAMers in each state, the total economic impact of the act, the number of new jobs supported by passing the act—and the amount of additional revenue generated by the act.

Methodology

The full methodology for our calculations can be found here.

According to our model, the educational effects of the DREAM Act vary dramatically by state and depend in a large part on the age and demographics of the DREAMers and foreign-born individuals in each state. The largest increases in college attainment will come from older DREAMers, who avoided going to college right out of high school because of their lack of legal status. Thus the states that see the largest increases in educational attainment are generally states with larger shares of older DREAMers with only a high school education. States with a lower estimated educational attainment impact in our model—Massachusetts, for example—already contain fairly well-educated, older DREAMers.

Though these already well-educated states see less benefit in terms of educational attainment, they still see great economic benefit from passage of the DREAM Act because gaining legal status improves wages significantly and allows these DREAMers to fully utilize their education. Additionally, these well-educated states tend to have higher median earnings, further magnifying the benefits to the state of passing the DREAM Act.

It is important to note that the states with close to or less than 10,000 DREAMers have too small a sample size to accurately project the magnitude of economic gains from passage of the DREAM Act. These states have been marked “interpret data with caution.”

Juan Carlos Guzmán is a monitoring and evaluation specialist at the Initiative for Global Development. Raúl C. Jara is a research associate at the University of Notre Dame’s Institute for Latino Studies.

See also:

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