Tighter immigration could clash with growth

Embedded in the immigration debate is a potential Catch-22: Restricting the supply of foreign-born labor could undermine the Trump administration’s promise to goose economic growth.

Some businesses already are seeing the labor market tighten, which can raise costs and crimp expansion.

“Every aspect of our industry needs workers,” said Michael Dunham, chief executive of Associated General Contractors in Georgia. “Immigration is clearly a factor. We have a native-born workforce that is not growing fast. People here are having smaller families. We are going to have to address this.”

One reason for sluggish economic growth is demographics – the massive boomer generation is steadily leaving the workforce, former Atlanta Fed chief Dennis Lockhart noted in an interview just before he left the job last month.

Growth — which Trump vows to boost to 4 percent, double or more the recent rate — depends on productivity, hours worked and the number of people working. All are growing slowly.

“We don’t have a wind at our back simply in terms of the number of people working in the country,” Lockhart said. “I don’t want to wade into a political battle, but … if you really want to address the rate of growth of the workforce, the number of people working, one of your options would be immigration.”

It’s unclear how Trump administration policies will unfold, but the rhetoric seems aimed at restricting the flow of both legal and undocumented residents. Proposals or discussion has included “extreme vetting” of immigrants; limits on programs for engineers and scientists; and more aggressive deportations of undocumented workers.

In Congress, Georgia Republican Sen. David Perdue is co-sponsor, along with fellow Republican Tom Cotton of Arkansas, of a bill that would cut legal immigration by about half — focusing on lower-skilled workers who they contend are driving down wages.

By Michael E. Kanell for AJC.COM
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