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The potential economic hit of sending "Dreamers" back

Dreamer profile
How DACA changed this Dreamer's life 02:41

Arguments for allowing recipients of the Deferred Action on Childhood Arrival, or DACA, program to remain in the U.S. often turn on a sense of generosity and goodwill. These young men and women are going to college, getting good jobs, buying cars and homes, and it would be cruel to send them back to countries they may barely know.

A new study suggests an economic argument that's just as potent for giving so-called Dreamers a path to citizenship or at least permanent residency. Deporting the roughly 800,000 DACA recipients would dent the U.S. economy in a big way -- to the tune of $100 billion in lost economic output over five years, and 720,000 lost jobs, Oxford Economics estimates in a study based on government immigration data.

The hardest hit states of California and Texas would lose 200,000 and 115,000 jobs, respectively, and see their state economic outputs drop by about 1 percent each. Other hard-hit states would include New York, Illinois, Arizona and Florida.

Companies would suffer, too, ranging from small businesses to Fortune 500 giants, the vast majority of which employ recipients of DACA, which defers quasi-legal status to undocumented immigrants brought to the U.S. as children.

President Trump and top Democrats agree to work together on DACA deal 03:50

"There's a misguided belief that an anti-immigration stance is positive for an economy," said Gregory Daco, Oxford's chief U.S. economist. In reality, smart immigration policy can be a "triple positive" -- leading to increased education, increased labor (providing talent in areas of need) and increased tourism, he said.

"If you weigh on that lever in an economy that's seeing its population age, in an economy growing at a moderate pace, that's near full employment, then you're really shooting yourself in the foot and curbing potential output," Daco said. "I was surprised by the potential magnitude of ending DACA."

And contrary to the claims of some immigration hardliners, deporting Dreamers won't simply open new job prospects for U.S. citizens, Daco said. Some of the economic activity would likely be sent overseas; other jobs would disappear. "You don't get a one-for-one replacement in these situations," he noted. "We're actually losing output and employment at the same time in a labor market that's near full employment. That's a negative hit on the economy."

DACA recipients are overrepresented in industries where unemployment is extremely low, like health services and education, so if they leave, many of those jobs will go unfilled, said Philip Wolgin, managing director for immigration policy at the Center for American Progress, which estimates in its own research that ending DACA would remove $460 billion from U.S. GDP over a 10-year period.

"We actually do have some real-world evidence of what happens when you take immigrants out of the labor force," Wolgin said. "Arizona in 2007 passed an immigration bill called the Legal Arizona Workforce Act, and the goal was to push unauthorized workers out of state and open up jobs. What [researchers] found five years later is the law did actually push unauthorized immigrants out of state, but it also pushed jobs out of state. Total employment after five years was down 2 percent."

Bannon criticizes Catholic Church's response to Trump's plan for DACA 01:21

Wolgin noted that the economic argument in support of allowing DACA recipients to stay, along with lobbying by business leaders, has helped sway some Republicans who were hesitant to join with supporters of a permanent Dreamers solution, including Sen. Lindsey Graham. Wolgin pointed out that local governments also have good reason to support legislation allowing Dreamers to stay: DACA recipients pay $2 billion per year in state and local taxes. "That's money that will be completely lost if they don't fix this," Wolgin said.

DACA recipients are successful and productive: 97 percent of them are currently employed or in school, 69 percent saw higher wages since receiving DACA benefits (including authorization to work, an opportunity to build credit and get driver's licenses) and 65 percent have purchased their first car, according to an August 2017 survey by Tom K. Wong of the University of California San Diego, United We Dream, the National Immigration Law Center and the Center for American Progress. It was the largest survey of its kind to date, with a sample size of more than 3,000 recipients in 46 states and the District of Columbia.

Ending the program, the Center for American Progress noted, would mean the young people "will be forced out of the workforce, upending their lives and the lives of their families, creating tremendous disruption for business, and sending shockwaves through the economies of most states."

Nonetheless, the DACA program is under legal attack. Ten states -- Alabama, Arkansas, Idaho, Kansas, Louisiana, Nebraska, Tennessee, Texas, South Carolina and West Virginia -- in June threatened to take their case to a federal judge known for tough stands on immigration if the Trump administration didn't end the program. They argued that DACA's creation, via a 2012 executive order by President Barack Obama, was improper because it sidestepped Congressional authority and that its recipients improperly use government resources and take jobs from citizens. (Those 10 states, by the way, stand to lose a collective $8 billion in state GDP if the program ends.)

Jeff Sessions announces plan to end DACA program 10:07

Early this month, Attorney General Jeff Sessions announced the Trump administration plans to phase out the DACA program, with a six month delay to give Congress a chance to act. President Trump later expressed an eagerness to work with Democrats on a solution that would allow Dreamers to remain in the country, a move that enraged some immigration hardliners who support him.

Meantime, a coalition of 16 mostly Democratic-leaning states including New York, Massachusetts, Illinois and Iowa are suing the administration in a bid to protect Dreamers. One of the states that signed on to the suit, Rhode Island, raised more than $170,000 from private donors to cover the renewal fee for all of the state's DACA recipients.

"We're not going to allow $495 to stand in the way of our neighbors' dreams," said Democratic Gov. Gina Raimondo in a statement. "Now is the time to fight for our values and take action against hatred and bigotry."

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