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Top 5 Reasons Why Administrative Action on Immigration Would Benefit American Workers

obama texas

SOURCE: AP/Kye R. Lee

President Barack Obama speaks at the Paramount Theatre in Austin, Texas.

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Last week, President Barack Obama announced that after a year of Republicans in the House of Representatives blocking immigration reform, he would begin his own efforts to fix the country’s immigration system. The president said that he asked Secretary of Homeland Security Jeh Johnson and Attorney General Eric Holder to recommend what steps he can take.

A recent report by the Center for American Progress outlines some of the executive actions President Obama should consider in order to repair our broken immigration system. The most significant action would expand temporary protection from deportation to certain undocumented immigrants—for example, individuals who have committed no crimes and have lived and worked in the United States for at least 10 years. In order to be eligible for this type of temporary protection, the individual would be required to register with the government, undergo criminal and national security background checks, and request the exercise of administrative discretion—a temporary reprieve from deportation that grants a work permit.

The upsides to such deferred action are numerous. It would enhance our security by bringing a broader swath of the immigrant population into the legal fold, enabling law-enforcement authorities to more effectively target their resources toward those who pose a threat to public safety. It would also lay the groundwork for future legislative reforms by starting the process of registering the undocumented population, a central—and likely inevitable—component of immigration reform.

A less understood but critical argument in favor of administrative action is simple: Enabling these individuals—most of whom are already in the work force—to work legally and to pay taxes would benefit both American workers and the economy as a whole. Here are the top five reasons why establishing a deferred-action program for undocumented immigrants would help American workers and our economy.

  1. Immigrants with temporary status would be able to contribute more in tax revenues. Bringing undocumented immigrants out of the shadows and allowing them to work legally would put workers and employers on the books, thus increasing tax revenues. According to estimates by the U.S. Social Security Administration, a minority of undocumented workers and their employers are paying payroll taxes. A deferred-action program would create an avenue for undocumented workers and their employers to pay payroll taxes, which support vital programs such as Social Security and Medicare.
  2. Undocumented immigrants who can work legally would improve the productivity of our labor market. Temporary status would let undocumented immigrants move freely in the labor market to find jobs that best match their skills. Greater labor-market mobility for undocumented immigrants would not displace native-born workers since many undocumented immigrants are already working in the labor market. Moreover, immigrants and native-born workers tend to occupy different types of jobs, even within the same industry. In fact, American workers would benefit from undocumented immigrants ability to work legally: When individuals have jobs that maximizes their skills, it increases not only their earnings, but also the productivity of the entire labor force, which in turn grows our economy.
  3. A deferred-action program would create jobs as undocumented immigrants spend more money in their communities. Undocumented immigrants with temporary status would be able to work legally, move into jobs that complement native-born workers, and earn a fair wage for their hard work. These immigrants would in turn spend their new earnings throughout their communities on purchases such as cars and homes. This increased consumption would generate new jobs for American workers as businesses meet the higher demand for goods and services.
  4. Granting temporary status would increase the wages of American workers. Similar to the benefit of job creation, temporary status would improve the wages of American workers in addition to the wages of immigrants themselves. Deferred action would help eliminate the downward pressure on wages due to employers taking advantage of undocumented immigrants’ legal status and paying them subminimum wages. More importantly, wages would likely rise as undocumented immigrants earn more money and spend their increased income throughout the economy. In addition, businesses would observe greater sales and higher profits, and workers would likely receive higher wages in turn.
  5. Giving legal status to unauthorized workers would improve employment protections for all workers. Currently, there are 8 million undocumented immigrants living and working in the United States. All too often, unscrupulous employers take advantage of these workers’ fear of deportation as a way to sidestep labor and employment laws, knowing that undocumented workers are not likely to file formal employment complaints with the government. Our labor and employment laws are most effective when all workers are able to execute their rights. As long as our immigration system undermines our employment laws, all workers are at risk of being victims of unlawful employment practices such as not paying overtime. Temporary status would ensure that some undocumented immigrants could work legally in the United States without fear of deportation. It would allow these workers to execute their workplace rights and, in doing so, strengthen the effectiveness of employment and labor laws for all workers.

A policy that enables eligible undocumented immigrants to register and request temporary protection from deportation would clearly benefit both American workers and the economy as a whole. But it is important to remember that these gains would only be a partial fix. The benefits would be much deeper and wider once Congress overcomes its paralysis and passes comprehensive immigration reform.

Since reform would provide permanent legal status and a pathway to citizenship, it would generate a greater incentive for undocumented immigrants and their employers to invest in their training and education. Legislative immigration reform would lead to a greater increase in undocumented immigrants’ wages and, in turn, increase the job and wage effects that flow from greater economic participation and consumption by undocumented immigrants.

But while American workers wait for Congress to pass immigration reform, they would be wise to welcome the president extending temporary status to undocumented immigrants.

Patrick Oakford is a Policy Analyst on the Economic and Immigration Policy teams at the Center for American Progress. Marshall Fitz is the Director of Immigration Policy at the Center.

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