Research: The Cost of a Single U.S. Immigration Restriction

One executive order cost the American economy $100 billion, according to a new study.

by

and

Britta Glennon

by

and

Britta Glennon

January 22, 2021

grandriver/Getty Images

Summary.

On June 22, 2020, President Trump passed an Executive Order drastically cutting the number of highly skilled international workers eligible for non-immigrant visas to the U.S. To quantify the impact of this policy, the authors examined the immediate change in stock price for over 400 top U.S. firms following Trump’s announcement, and found that the immigration restriction cost the U.S. economy a total of $100 billion. This finding — along with substantial prior research demonstrating the detrimental effect of restricting immigration on both domestic employment rates and long-term economic health — suggests that easing these restrictions will be key to supporting the American people through the current crisis and beyond.

On June 22, 2020, President Trump issued an executive order (EO) significantly reducing the number of people eligible for non-immigrant work visas, arguing that due to high domestic unemployment during the pandemic, “the entry…of certain aliens as immigrants and nonimmigrants would be detrimental to the interests of the United States.” This new restriction barred nearly 200,000 highly-skilled international workers — many of whom hold advanced degrees in STEM fields, and on whom U.S. companies rely to fill key talent gaps — from entering the U.S.

DB

Dany Bahar is a senior fellow in the Global Economy and Development program at the Brookings Institution. An Israeli and Venezuelan economist, he is also an associate at the Harvard Center for International Development. His research sits at the intersection of international economics and economic development. In particular, his academic research focuses on the diffusion of technology and knowledge within and across borders, as measured by productivity, exports, and innovation, among other factors. Lately, his research has focused on migrants and refugees as drivers of this process, alongside trade and capital flows.
PC

Prithwiraj (Raj) Choudhury is the Lumry Family Associate Professor at the Harvard Business School. He was an assistant professor at Wharton prior to joining Harvard. His research is focused on studying the Future of Work, especially the changing Geography of Work. In particular, he studies the productivity effects of geographic mobility of workers, causes of geographic immobility and productivity effects of remote work practices such as “work from anywhere” and “all-remote.” He is the author of the recent HBR article titled “Our Work-from-Anywhere Future.”
BG

Britta Glennon is an Assistant Professor at the Wharton School of Business at the University of Pennsylvania, and an NBER Faculty Research Fellow. Her research is at the intersection of innovation, immigration, and international business and has been featured in media outlets such as The Economist, the Wall Street Journal, Forbes, and Bloomberg. Britta holds a B.A. in Economics and East Asian Studies (Chinese) from Cornell University, a Masters in Public Policy from the University of Chicago, and a PhD in Public Policy and Management from Carnegie Mellon University.

Research: The Cost of a Single U.S. Immigration Restriction

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