To prosper, an aging U.S. needs immigrants

Group of 20 becomes U.S. citizens on Fourth of July in Charlotte

Twenty people, representing 15 countries, took the oath of allegiance during the fifth annual Independence Day Naturalization Ceremony at the Charlotte Museum of History
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Twenty people, representing 15 countries, took the oath of allegiance during the fifth annual Independence Day Naturalization Ceremony at the Charlotte Museum of History

Most of us recognize the American population is aging. Consider the ongoing debates about the long-term viability of Social Security, Medicare, and Medicaid. Yet political discourse about comprehensive immigration reform suggests most do not understand that – precisely because the U.S. native-born population is aging – we simply can’t thrive and prosper in a hyper-competitive global economy if we close our borders to new talent and fail to find a place for immigrants, including the 11.5 million unauthorized immigrants who are already live on our shores.

Nor do they seem to understand, by extension, that if we are not globally competitive, we can’t build the economy we need to sustain the social safety-net programs that serve seniors and other vulnerable populations.

Forces driving the aging process amplify the need for immigration reform.

First, fertility rates have declined sharply over the past quarter century, especially among native-born, white women. The decline is related, in part, to the growing role of women in the paid workforce. Some women have responded to increased opportunities to work by delaying marriage and/or childbearing until they are well established in their careers. For others, career goals and aspirations have overshadowed marriage and childbearing altogether. Whatever the reason, the percentage of U.S. women between the ages of 40 and 44 choosing not to have children doubled between the mid-1970s and the mid-2000s.

As a consequence, the white total fertility rate – a statistical measure of the number of children a woman is likely to have – has fallen below the replacement level of 2.1 for almost two decades. In part for this reason, and despite the fact that aging Boomers and Pre-boomers are living longer and seniors are disproportionately white, “deaths exceeded births among white Americans for the first time in at least a century” during the year ending July 1, 2012.

Population loss

Second, these two demographic forces – declining fertility and population aging – are threatening the future fiscal and economic viability of many U.S. communities, further fueling the necessity for immigration reform. Between 2010 and 2015, 21 percent of the nation’s metropolitan areas and 52 percent of the nation’s 536 micropolitan areas lost population. In nearly all of these communities, deaths exceeded births and internal migration was not sufficient to offset natural population loss. Bereft of mainstream employment opportunities, these communities are literally dying as young adults leave in search of opportunity.

The critical role that immigration can and will have to play in their revival is evident. An even larger number of metropolitan areas would have lost population were it not for the influx of immigrants between 2010 and 2015. Immigrants are breathing new life into these communities, fostering population, economic and employment growth through their entrepreneurial acumen. Across the nation, immigrant newcomers were critical drivers of growth in almost all of the metropolitan areas and micropolitan areas that gained population between 2010 and 2015.

Younger immigrants

Third and perhaps most importantly, given the aging of our native-born population, we must recognize that immigration is highly selective of young people, who are much more likely to move. There is, for example, a 15-year differential between the median age of native born whites (45) and Hispanic immigrants (30) in the U.S. Taking this age differential into account, it is a strategic imperative for our nation to move beyond our preoccupation with fiscal impacts – the short-term costs and benefits associated with immigrants – and focus instead on the broader and longer term economic impacts of immigration.

Even if the short-term fiscal impacts are negative, these costs are often offset or overshadowed by the direct and indirect impacts of immigrant consumer spending in local communities. Our studies of the economic impact of immigrants in North Carolina and Arkansas before and during the Great Recession of 2007-2009 revealed, for example, that these two states received in return for every dollar invested in K-12 education, health care, and corrections between $6 (AR during the recession) and $10 or $11 (North Carolina and Arkansas, respectively, prior to the recession) in business revenue and taxes from their immigrant populations. And notably these were the cost-benefit ratios after subtracting roughly 20 percent of the immigrant purchasing power that was sent home in the form of remittances. Moreover, through their consumer expenditures, the immigrant newcomers were responsible for the creation of 171,000 spinoff jobs in North Carolina and 36,100 in Arkansas.

Immigration-driven population diversity has added substantial economic value in our aging U.S. society. If we continue our draconian treatment of immigrants, the negative economic impact will be substantial and very difficult, if not impossible, for our nation to overcome. Hopefully, a better understanding of the vitally important link between an aging native-born population and a younger immigrant population will stem the tide of senseless violence witnessed most recently in El Paso.

James H. Johnson is the William R. Kenan Jr. Distinguished Professor of Strategy and Entrepreneurship at the University of North Carolina Kenan-Flagler Business School. Allan Parnell is vice president of the Cedar Grove Institute for Sustainable Communities in Mebane, North Carolina.