At present, there are about 8.6 million immigration applications pending before the U.S. Customs and Immigration Service (USCIS). Of those, 5.2 million are backlogged, experiencing longer than usual processing times. As with many federal agencies, the USCIS’s operations were substantially disrupted by the COVID-19 pandemic; it is a public-facing agency, conducting a substantial share of its activities with members of the public and often in person.

The USCIS is also unique among government agencies in that it is almost entirely funded by user fees, mostly receipts from foreigners applying to enter or remain in the country. The agency receives about 97% of its funding through the imposition and collection of fees charged to immigration applicants. While making immigrants pay entirely for their own processing costs may seem fair, this financing model means that the agency has little to no capacity to increase resources to catch up when it falls behind, and today it is woefully behind.

Given the endemic labor shortages across the United States, this would be a good time for Congress to lend a hand. We assessed several funding and staffing scenarios that would eliminate the pending application backlog. Each scenario would require additional congressional appropriations totaling $3–$4 billion—about one quarter of 1 percent of annual federal spending—and could effectively clear the backlog in as little as two years.

Economically, a more expedient processing of immigration applications would be a good deal for the United States. While taxpayers would be on the hook for the cost of addressing the backlog, more expedient processing would serve to increase the lifetime economic output and tax payments of these immigrants. Our analysis estimates that eliminating the backlog would add about 938,000 new workers to the U.S. economy over the next few years, and their entrance into the domestic economy would create as much as $110 billion per year in additional real gross domestic product. The earlier arrival of new workers and the concomitant increase in national income would have a significant and positive government budgetary effect over the next decade that would easily exceed the upfront budgetary cost of eliminating the backlog.

While many of the applications pending before the USCIS may be administrative or otherwise economically inconsequential, the elimination of this backlog would nevertheless increase immigration and employment in the United States. Improving this process and clearing out the current backlog would ultimately yield meaningful economic and fiscal benefits.