Immigration is increasing US economic growth and politicians are angry
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| Immigration is increasing US economic growth and politicians are angry |
Goldman raises GDP growth forecast amid rising immigration
HSBC says none of the advanced economies are benefiting.
While the growing number of immigrants in the U.S. has sown divisions among politicians across the country — and angered a large number of voters — there is one place where almost everyone is the same, passionate, See page: Wall Street.
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Last month, the nonpartisan Congressional Budget Office (CBO) calculated that immigration a 7 trillion dollar increase for gross domestic product over the next decade. The agency reached this conclusion after factoring in recent increases in immigration.
The CBO's release sparked a fresh wave of downgrades among investment bank economists, as new arrivals could boost the labor force and consumer spending. On Sunday, Goldman Sachs Group Inc.
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updated its prediction for near-term economic growth. No advanced economy is benefiting from immigration as much as the U.S., and "the impact of immigration has been an important part of the U.S. growth story," Morgan Stanley economists Sam Coffin and Alan Zenter noted this month. Rapid population growth due to immigration lends itself to stronger employment and population estimates than initially thought - although it added that the full effect may not be captured by official figures. CBO statisticians included data from U.S. Customs and Border Patrol to come up with their higher projected net immigration, according to a Morgan Stanley analysis.
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Goldman estimates immigration to be about 2.5 million in 2023, much higher than the 1.6 million foreign-born population change indicated in the Census Bureau's Official Household Survey.
The positive tone among economists is fueled by political tension over the rise in undocumented immigrants crossing the southern border seen on the campaign trail. According to one, the share of Americans who see immigration as the most important issue facing America is now at a record high in four decades of data. A recent Gallup poll.
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The recent boost from immigration is both the result of more legal immigrants as the U.S. moves through. Unprecedented visa backlog and an increase in illegal border crossings. The nation's 32.5 million immigrant workers now make up nearly one in five American workers, the highest number in nearly two decades of official data.
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To be sure, the connection between high inflows of foreign workers and rapid post-pandemic recovery has been noted by economists and policymakers alike for some time. Federal Reserve Chairman Jerome Powell has repeatedly cited immigration as a reason for strong economic growth.
As for the role played by a higher labor supply, Powell on Wednesday pointed to the "strong momentum" of immigration as helping on that front.
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you're seeing larger increases in supply. Yes," Powell said. press conference on Wednesday. Fed policymakers picked them up Forecasting growth For this year, their average estimate showed a 1.4% to 2.1%.
According to Michael Ferroli, chief U.S. economist at JPMorgan, immigration "has been key to the surprising pace of job growth, even with the unemployment rate rising modestly," "This, in turn, has been surprising. has been a factor behind robust overall revenue and productivity growth."
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While there are warnings that increased immigration will reduce wages and conditions in some industries - the unemployment rate hit a two-year high in February - businesses are stepping up calls for more changes. Staff By legal means.
About 9 million jobs are open across the economy, which equates to 1.4 jobs for every job seeker. Foreign-born workers will make up a record 18.6 percent of the U.S. workforce in 2023, and the U.S. approved a record number of work permits in the fiscal year through last September.
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Immigration is a "very sensitive policy," Ferroli warned, advising against mass deportations beyond the end of this year.
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