US Economy Hurt by Immigration Crackdown

According to the president of the Federal Reserve Bank of Dallas, the immigration crackdown spearheaded by President Trump is having an adverse effect on the growth of the US economy as undocumented immigrant workers cut their spending and stay home, fearing deportation.

On Wednesday, at the Council on Foreign Relations in Washington, Robert Kaplan said that such immigrants are now more likely to save their money rather than spend it, and that customer spending and the growth of the US dollar will be affected. Kaplan says that customer spending accounts for 70 percent of the nation’s economy, with Americans in the low and middle-income class, including immigrants, usually more likely to spend than to save.

As well as cracking down on illegal immigration, President Trump has also promised to reduce the current scale of legal immigration, prioritizing high-skilled overseas workers. Kaplan says that immigrants help provide employers with an adequate workforce, something elevated by the aging population of the US. Many companies complain that they struggle to find workers, having an adverse impact on their output and broad economic growth, with the unemployment rate at a ten-year low of 4.4 percent.

Net immigration to the US, in the wake of Trump’s immigration crackdown, is likely to be reduced to $750,000 from the current $1 million, claims Moody’s Analytics chief economist, Mark Zandi. Productivity and consumption hindering, and workforce size are hurting the economy.