The US is about to start running out of one of its most valuable resources: skilled immigrants. But it can alleviate that shortage by letting in lots of talented refugees, just as it did in the 1930s and after the Second World War.
The coronavirus pandemic has given President Donald Trump the cover he needed to bar many green-card holders and applicants, H-1B workers, other skilled workers and foreign students from the country. Even before the pandemic, Trump’s policies and rhetoric had sharply curtailed the net inflow of immigrants. A new report by the National Foundation for American Policy, a think tank, estimates that legal immigration to the US (most of which is of the skilled variety) will be 49% lower in 2021 than in 2016. Even that estimate is probably too optimistic because it assumes that employer-sponsored and immediate-family immigration will rise.
This is a tragedy and a disaster for the US. Trump’s supporters might not realise it, but the country is highly dependent on the talents and effort of foreign workers. For example, US technological and industrial leadership is dependent on university research, which is mostly carried out by graduate students. In many critical fields, these students are mostly from overseas:
Foreign-born professors are also indispensable. In life sciences and medicine, which are critically important in emergencies like the current pandemic, the NFAP report notes that 56.6% of researchers are foreign-born. This includes many of the people now racing to find a coronavirus vaccine.
More generally, the medical system is also critically dependent on foreign-born workers:
Curtailing the flow of skilled immigrants into the US will also reduce tax revenues and make it more difficult to support an ageing population.
Why the immigration restrictionists are wrong
Immigration restrictionists will argue that the loss of foreign-born talent is a good thing — that more research and professional jobs will now go to native-born Americans, and that the US will invest more in educating its own young people. Both of these claims are almost certainly false. Foreign students pay high tuition that allows universities to more cheaply educate native-born Americans; kicking them out will wound an already imperilled US university system.
As for jobs, the presence of skilled immigrants actually helps native-born workers. Having more H-1B workers in a city, for example, increases wages for Americans of all education levels. This is because having more skilled workers in an area makes companies more likely to locate their offices there. Drain US cities of talented immigrants, and companies won’t simply hire unqualified native-born people to fill the lost spots; they’ll pack up and move overseas to find talent. Economist Britta Glennon studied the effect of a restriction on H-1B visas in 2004, and found that it increased hiring at US companies’foreign affiliates.
So keeping up skilled immigration is crucial for the health of the US economy. But while a Joe Biden presidency might be able to reverse some of the damage, much of it will likely be long-lasting. Worries about competition from H-1B workers run deep on the left as well. And many prospective foreign workers will certainly be deterred by the knowledge that they could be kicked out if policies that encourage immigration are reversed based on a single election outcome.
Where, then, will the US get its skilled immigrants? It will have to resort to opportunism, scrounging for them anywhere it can. With traditional channels to attract talented workers out of favour, it will have to find people for whom staying in their home countries is too dangerous, and offer them refuge.
A 2014 paper by economists Petra Moser, Alessandra Voena and Fabian Waldinger found a substantial increase in US innovation in fields that received large numbers of such scientists after 1933.
These could include political dissidents, who tend to be educated. It could also include ethnic and religious minorities fleeing persecution. For example, the US could let in large numbers of people from Hong Kong, where the Chinese government is carrying out a clampdown. It could also give asylum to Uighurs. Muslims in India, Christians in Nigeria and LGBT people from Russia are just three more of many examples.
The US used exactly such a strategy to get some of its most high-profile skilled immigrants during the 1930s, 1940s and 1950s. Despite strict immigration restrictions, the US was able to bring in many Jewish scientists fleeing Nazi persecution — most prominently Albert Einstein — and later to admit large number of Jewish refugees after the war. Many of these Jewish émigrés ended up making important scientific contributions. A 2014 paper by economists Petra Moser, Alessandra Voena and Fabian Waldinger found a substantial increase in US innovation in fields that received large numbers of such scientists after 1933. The Manhattan Project itself might not have succeeded without substantial input from these researchers.
In a world that is often authoritarian and brutal, the US has many opportunities to repeat this trick. By letting in persecuted individuals and groups, it can do a good deed, enhance its battered international standing and help sustain its technological and industrial strength.
— Bloomberg
Noah Smith is a columnist. He was an assistant professor of finance at Stony Brook University
