The Role of Immigration in Fostering Competitiveness in the United States
Highlights
Immigration strengthens U.S. innovation and competitiveness, but rigid visa caps and small employment-based quotas limit employer selection.
- Immigration policy is an indispensable and strategic factor in U.S. economic growth, innovation, and competitiveness, yet key features of the current system undermine these contributions.
- Employer-driven selection is a major asset of the U.S. system, allowing firms to identify sought-after workers and give the most talented priority for permanent residence, but employment-based immigration remains a small share of total permanent immigration.
- Rigid numerical limits on work visas and undifferentiated caps across skill levels create inefficiencies, leading to visa stampedes and backlogs in years of high demand.
- The report calls for streamlined pathways that bridge temporary to permanent status, greater differentiation at skilled and highly skilled levels, and flexible numerical limits that can adjust to changing economic circumstances.
Immigration policy is an indispensable and strategic factor in economic growth and prosperity, contributing to innovation, technological progress, and competitiveness. However, while aspects of the U.S. immigration system facilitate newcomers’ contributions to economic growth and competitiveness, others undermine them. Significant reforms are needed to enhance the job-creating power of U.S. employers and strengthen the system’s ability to select effectively from the large pool of foreign workers.
One of the greatest assets of the U.S. immigration system is employer-driven selection, which allows effective identification of sought-after workers, and grants the most talented priority to gain permanent residency. However, employment-based immigration is a small proportion of permanent immigration and U.S. policy has proved inflexible to changing circumstances, preventing numerical limits on visa distribution from shifting with demand. Temporary-to-permanent work-visa programs are the majority of employment-based immigration, but are inefficient and require a complicated administrative process.
The recent economic crisis lessened some problems arising from the constrained, undifferentiated supply of work visas by reducing demand. Fixing the system’s flaws, however, may be difficult, and requires substantial reforms and greater flexibility. Strategies include a streamlined process to enable temporary visa holders to become permanent residents, greater differentiation at skilled and highly skilled levels, and flexible numerical limits to avoid stampedes for visas and the exhaustion of visa limits in years of high demand.
Table of Contents
I. Introduction
II. Immigration and Economic Prosperity
A. In What Ways Does Immigration Affect the Economy?
B. Implications for Immigration Policy
III. Immigration to the United States: Policies and Flows
A. Exceptionally Skilled Immigrants — the “Most Talented"
B. Policies toward the Skilled and Highly Skilled
C. International Students and Skilled Immigration
D. Less-Skilled or Low-Wage Immigration
IV. Two Examples of Immigrants’ Economic Role: Health Care and Information Technology
A. Health Care
B. Information Technology
V. Conclusion
About the MPI-EUI Project
This concluded, EU-funded project identified ways in which European and U.S. immigration systems can be improved to address major challenges, in the context of economic turmoil and in the longer term.
About the Global Program
The Global Program bridges policy advice, research, and candid dialogue to design effective migration policies, drawing on global evidence and anticipating the forces reshaping how people move.
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