The Cost of Excluding Undocumented Workers From Stimulus Funds

The federal government’s decision to exclude undocumented residents from the $1,200 stimulus payments given to taxpayers during the COVID-19 pandemic resulted in a loss of $10 billion in potential economic output, a UCLA study has found. It also cost 82,000 jobs nationally and 17,000 jobs in California, according to the study, a collaboration among UCLA’s Latino Policy and Politics InitiativeNorth American Integration and Development Center and Institute for Research on Labor and Employment. Undocumented workers and their families contributed more than $1.6 trillion to the nation’s gross domestic product in 2018 through shopping and workforce activities, and their reduced purchasing power amid a looming recession is both a public health and economic crisis, said Raul Hinojosa, an associate professor of Chicano studies and the report’s lead author. “It is cruel to deny undocumented residents financial assistance as unemployment rates skyrocket, but it’s also counterproductive fiscal policy that has negative consequences for all Americans who benefit from their economic contributions,” he said. The national unemployment rate for undocumented workers reached 29% in May, much higher than the rate for any other demographic group. The study found that the economic benefits of including undocumented workers in future relief efforts would outweigh the costs. The economic activity generated by undocumented immigrants spending the tax credits they would receive under the HEROES Act, currently being debated in Congress, would support 112,000 jobs nationally and produce $14 billion in economic output — which would far exceed the $9.5 billion price tag of including them in recovery efforts. — Eliza Moreno


 

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