Congressional Budget Office
Director's Blog

People born in other countries are a growing presence in the U.S. labor force. In 2009, more than 1 in 7 people in the U.S. labor force were born elsewhere; 15 years earlier, only 1 in 10 was foreign born. About 40 percent of the foreign-born labor force in 2009 was from Mexico and Central America, and more than 25 percent was from Asia.

Today CBO released an update to its November 2005 report on the role of immigrants in the U.S. labor market. That earlier report included data through 2004; this update, the first of several on various aspects of immigration, incorporates data through 2009 from the Census Bureau’s Current Population Surveys. The update includes various tables showing statistics on the number of foreign-born workers, the countries from which they have come, their educational attainment, the types of jobs they hold, and their earnings.

Some highlights include:

• People born in other countries represent a substantial and growing segment of the U.S. labor force—that is, people with a job or looking for one. In 2009, 24 million members of the labor force were foreign born, up from 21 million in 2004. However, the growth of the foreign-born labor force was much slower between 2004 and 2009 than between 1994 and 2004.
• In 2009, over half of the foreign-born workers from Mexico and Central America did not have a high school diploma or GED credential, as compared with just 6 percent of native-born workers. Yet nearly half of the foreign-born workers from places other than Mexico and Central America had at least a bachelor’s degree, as compared with 35 percent of native-born workers.
• Over time, participants in the U.S. labor force from Mexico and Central America have become more educated. In 2009, they had completed an average of 9.8 years of schooling—up from 9.5 years in 2004; 55 percent lacked a high school diploma or GED credential—down from 59 percent in 2004; and among 16- to 24-year-olds, 50 percent were not in school and were not high school graduates—down from 60 percent in 2004. Nevertheless, those born in Mexico and Central America constitute an increasingly large share of the least educated portions of the labor force.
• To a considerable extent, educational attainment determines the role of foreign-born workers in the labor market. In 2009, 70 percent of workers born in Mexico and Central America were employed in occupations that have minimal educational requirements, such as construction laborer and dishwasher; only 23 percent of native-born workers held such jobs.
• Foreign-born workers who came to the United States from places other than Mexico and Central America were employed in a much broader range of occupations. Nevertheless, they were more than twice as likely as native-born workers to be in fields such as computer and mathematical sciences, which generally require at least a college education. Their average weekly earnings were similar to those of native-born men and women.
• On average, the weekly earnings of men from Mexico and Central America who worked full time were just over half those of native-born men; women from Mexico and Central America earned about three-fifths of the average weekly earnings of native-born women.

This report was prepared by Nabeel Alsalam of CBO’s Health and Human Resources Division.

CBO released a new report this morning on the impact of unauthorized immigrants on state and local government budgets. Most analyses have found that the fiscal impact of immigrants as a whole (both legal and unauthorized, and including all levels of government) is slightly positive — the tax revenues generated by immigrants exceed the cost of the government services they use. This study examines the literature on a more narrow question: the fiscal impact of unauthorized (as opposed to all) immigrants at the state and local government level (excluding the federal government).

Many state and local governments incur costs for services associated with unauthorized immigrants, particularly in the areas of education, health care, and law enforcement. Some of those costs are incurred because of rules governing federal programs, court decisions, and state-level statutory or constitutional requirements. CBO’s review of the literature finds that the amount of spending involved is a small share of total state and local spending on these services, but the tax revenue collected from unauthorized immigrants at the state and local level does not offset the costs involved. The result is probably a modest negative net impact on state and local budgets.

The paper was written by Melissa Merrell in our Budget Analysis Division, which is the part of CBO responsible for preparing cost estimates of legislation. Melissa covers topics including immigration, administration of justice, emergency management, and regional planning in the State and Local Government Cost Estimates Unit. Prior to joining CBO, she worked for the Association of Metropolitan Planning Organizations and the League of Women Voters. She holds a master’s degree in public policy from George Washington University and a bachelor’s degree in political science and sociology from St. John Fisher College in Rochester, NY.