State-by-State Analysis of the Economic Impact of DACA, DAPA, and DACA Expansion
In November 2014, millions of Americans and their families watched and rejoiced together as President Barack Obama announced a series of immigration directives to strengthen border security, focus immigration enforcement on serious threats, and temporarily defer the deportations of 5 million eligible undocumented immigrants. Specifically, the directives included two programs: the expansion of the 2012 Deferred Action for Childhood Arrivals, or DACA, program—which would provide temporary relief to immigrants that came to the United States as children—and the creation of Deferred Action for Parents of Americans and Lawful Permanent Residents, or DAPA, program, which would grant temporary reprieve from deportation to parents of U.S. citizens and permanent resident children.
A recent CAP report, ”Assessing the Economic Impacts of Granting Deferred Action Through DACA and DAPA,” estimated that the deferred action programs—DACA, DAPA, and expanded DACA—will grow the U.S. economy cumulatively by $230 billion over 10 years. The analysis in this interactive takes that methodology a step further and updates a 2013 CAP issue brief and estimates the substantial economic benefits that individual states will see from these programs. The following interactive shows the impact that the three deferred action programs will have on state gross domestic product, or GDP, gains in income, and creation of jobs over 10 years, in 37 states and Washington D.C.
The economic benefits of the deferred action programs vary widely by state, depending on the size of the eligible population. For example, in Texas, almost 51 percent of the 1.5 million undocumented immigrants are eligible for the programs. If these individuals were to receive temporary work permits, the state of Texas is estimated to see a cumulative increase of $38.3 billion in GDP, with a $17.6 billion increase in income for all state residents and an increase of 4,800 jobs annually over the following decade. States with smaller undocumented populations such as Colorado—where half of the state’s 164,000 undocumented immigrants may benefit from these programs—may see cumulative gains of $3.3 billion in GDP and $2.1 billion in income increase for all state residents in the 10 year period.
The reasons why states see such large gains from the deferred action programs are similar to why the whole nation stands to benefit. Nationally, more than half the undocumented individuals have been living in the United States for at least 13 years with the majority of them working in our farms, factories, construction, hotels, and restaurants. If allowed an opportunity to receive temporary work permits, these immigrants will likely experience significant wage gains. These work permits will allow them to get jobs that better match their skills and protect against workplace exploitation such as wage theft. The increase in income of undocumented immigrants means that they will have more to spend on everyday goods and services. This increase in demand will have a ripple effect throughout the state’s economy, increasing the incomes of all state residents and creating jobs for all.
This analysis uses the latest state level data from the Migration Policy Institute, or MPI, for the population of undocumented immigrants eligible under the DACA, DAPA, and DACA expansion programs. These data are slightly different from CAP’s previous national estimate, as MPI updated their data using the new 2009-2013 American Community Survey estimates. To estimate the number of people working in each state among the deferred action eligible population, we use the percentage of the total undocumented population estimated to be in the labor force in each state as a proxy. For example, if 71 percent of the undocumented immigrant population in Ohio is in the workforce, we assume that the same percentage of deferred action eligible individuals are also in the workforce.
Based on the analysis from CAP’s earlier report, we assume that undocumented workers who receive temporary work permits will experience a wage gain of 8.5 percent. This wage gain is lower than what we would expect pursuant to a permanent legislative reform, where immigrants will have a greater incentive to invest in their skills and education. Previous studies have estimated that the wages will rise 15.1 percent from legalization and a full 25.1 percent if individuals were able to get citizenship. This analysis uses the most recent state GDPs from the Bureau of Economic Analysis, mean incomes from the March 2014 Current Population Survey, and job estimator from the Economic Policy Institute.
For more information about the methodology used in this analysis see Robert Lynch and Patrick Oakford, “The Economic Effects of Granting Legal Status and Citizenship to Undocumented Immigrants” (Washington: Center for American Progress, 2013), available at https://americanprogress.org/issues/immigration/report/2013/03/20/57351/the-economic-effects-of-granting-legal-status-and-citizenship-to-undocumented-immigrants/.
Several other groups, such as the Congressional Budget Office, the Social Security Administration, the Council of Economic Advisors, and the Institute on Taxation and Economic Policy, have illustrated the economic gains from the November immigration directives. The results of this analysis show that the deferred action programs are significantly beneficial for individual state economies at varying levels. Yet, six months after the November announcement, DAPA and the DACA expansion remains on hold, embroiled in a legal battle in the federal courts filed by states that are undermining their own fiscal interests. States do better when their residents are given an opportunity to realize their full potential. These deferred action programs will help the eligible immigrants contribute even more to their state’s growth, increase not just their own income but incomes of all other state residents, and create hundreds if not thousands of jobs in the process.
Silva Mathema is a Policy Analyst on the Immigration Policy team at the Center for American Progress. The author would like to thank Robert G. Lynch, Marshall Fitz, and Philip E. Wolgin for their invaluable input.
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Director, Immigration Policy