President Trump is endorsing an immigration plan that will hurt job growth and the U.S. economy overall, according to two recent studies.
In a report published Thursday, the University of Pennsylvania’s Wharton School said the immigration plan, dubbed the RAISE Act, would result in 4.6 million lost jobs by the year 2040. It also found that the U.S. economy would be 2% smaller than it would be under the current immigration policy during that time.
Last week, Trump threw his support behind the RAISE Act, a bill crafted by Republican Senators David Perdue and Tom Cotton. The proposal seeks to cut legal immigration to the U.S. by 50% within a decade.
“If you have fewer workers, we will have less economic growth,” said Kimberly Burham, a managing director at the Penn Wharton Budget Model, a nonpartisan research team at UPenn.
Economists say the U.S. economy depends on foreign workers to grow the labor force and maintain growth. Since 2000, Baby Boomers have been retiring at a much faster pace than the U.S. job market has been growing, according to data from the Atlanta Federal Reserve and Labor Department.
There were 27 million foreign-born workers in the United States last year, government figures show.
“Immigrants, especially new immigrants, are highly productive and if we decrease that number, that will harm economic growth in the short and long run,” said Burham.
The White House claimed the Wharton study had “major methodological faults” and that the economic gains it assumes come “at the expense of American workers.”
“The estimates show that the job ‘losses’ under their RAISE Act model are far smaller than the reduction of foreign workers – effectively meaning a net increase in available jobs for Americans. The passage of the RAISE Act would raise wages and increase economic opportunity for Americans who have been left behind under the failed policies of past administrations,” a White House official told CNNMoney.
The RAISE Act seeks to limit the ability of immigrants to get permanent residency in the form of green cards, restricts immediate family members who can be sponsored for visas and eliminates the international diversity lottery. Instead of replacing those green cards, it would overhaul the employment-based visa system, switching over to a point-based system that places heavy emphasis on higher education, salary and English-language skills.
By Patrick Gillespie and Tal Kopan for CNN Money
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