Contributing to that labor scarcity, the number of legal immigrants arriving in the United States has fallen appreciably over this period. COVID and the resulting global restrictions on migration contributed to that decline in 2020 and 2021. But a good portion of the decline is the result of the Trump administration’s deliberate policies to reduce both legal and illegal immigration, ostensibly motivated by the desire to preserve jobs for American-born workers.
To accomplish this, the administration worked to change several immigration rules. For instance, it worked to keep foreign-born college graduates of U.S. universities from staying and working in the United States. The administration also stopped allowing people with H‑4 visas, which go to the spouses of people who receive H‑1B visas, from working in the United States. And the Trump administration took steps to reduce the number of H‑1B visas, which go to foreign workers who are specifically sought by American employers.
These efforts served to constrain the U.S. labor market at a time when employers across the country were finding it difficult to hire and retain skilled workers. Except for the spike during the COVID pandemic shutdowns, unemployment has been below 4 percent nationally since the spring of 2018.
While immigration remains a contentious issue in Congress, the skilled labor shortage continues to constrain the U.S. economy and constitutes a significant barrier to developing and growing new industries and job opportunities. This should make fixing immigration a priority. Members of both major political parties have acknowledged that the lack of skilled workers in the United States is hurting the broader economy as well as the prospects for less-skilled American-born workers who have jobs partly dependent on the presence of more-skilled colleagues.
The following essays offer suggestions for how the 118th Congress can reform the immigration system and boost the U.S. economy and create or sustain jobs. Kevin McGee of the University of Wisconsin, Oshkosh suggests adopting legislation that would statutorily allow H‑4 visa holders to work in the United States. Eric Miller discusses how our current trade agreement with Mexico and Canada could better enable companies to transfer their workers across boundaries on a temporary basis and how that would boost U.S. economic competitiveness. American Action Forum scholars Gordon Gray and Whitney Appel propose that we stop requiring that U.S. immigration services be fully funded by user fees. Doing that would allow the services to operate more effectively and humanely and reduce the enormous backlog of skilled workers attempting to apply for residency in the United States. Finally, David Bier of the Cato Institute discusses steps to improve the H‑1B visa situation.
Congress has found it increasingly difficult to achieve bipartisan legislation in the last few years, especially on issues like trade and immigration. But if the country’s labor shortage continues to add inflationary pressure to the economy and constrain all sorts of firms from expanding domestic operations, this may provide enough impetus to accomplish immigration reform.
