By Tariq Fanek
New research from the American Immigration Council on the impact of refugees on the U.S. economy suggests that opening America’s doors to those fleeing conflict and persecution is not only the right thing to do, it is good for the economy and our nation’s population and talent crises. The June 2023 report builds on a previous survey of 2.4 million refugees between 2015 and 2019.
First and foremost, refugees help build the U.S. economy, providing important labor and spending in a country that is seeing fewer high school graduates, due in part to declining birth rates. This is particularly critical for states like Michigan that are facing what one of the state’s most prominent online public policy journals, Bridge Michigan, refers to as “Michigan’s Population Crisis.” In fact, at the federal level, refugees earned over $93.6 billion in household income in 2019, contributed $25 billion in taxes and provided over $68.6 billion in spending that provided much-needed consumer spending for U.S. businesses. This has also brought substantial development for local and state taxes, with refugees alone paying $8.7 billion in taxes.
Some assume that refugee families are a drain on the U.S. economy, consuming more than their fair share of welfare and public services, but the research proves the opposite. When researching refugee households 20 years after resettlement, the research finds that refugees actually earned more than other households with a median refugee household income of $71,400 compared to $63,000 for typical American families. The data clearly shows that refugees are a great long-term investment. However, we know that with only six months of resettlement support through the federal refugee resettlement program, refugees face serious challenges when they first arrive. The data on the success that refugee families have had 20 years after resettlement shines a light on how hard many have worked to pursue the American Dream, once given the opportunity.
Refugees provide an important source of labor at a time when employers across the nation struggle to find enough workers to fill jobs. Refugees are more likely to be of working age: 78.2 percent of refugees are of working age, compared to 61.9 percent for U.S.-born citizens. Of the refugee workforce, 24 percent work in general services and 13.9 percent in transportation and warehousing. The main industries that refugees work in are manufacturing (18.9 percent) and health care and social assistance (15.2 percent), sectors also facing dire labor shortages. Both sectors are in high demand in Michigan and refugees can fill these gaps.
The report does uncover some areas of concern. Unfortunately, the underemployment rate (those who are working in jobs outside of their skill set and education) for refugees is the highest, with 36.2 percent holding a degree or talent but not having the opportunity to work in their field. Fortunately, Michigan is a national leader in addressing the underemployment of college-educated immigrants and refugees. The state has developed professional licensing guides that assist foreign-trained and educated professionals in how to obtain their Michigan license or professional certification in nearly 50 occupations, well more than any other state. For nearly a decade, the Office of Global Michigan operated the Michigan International Talent Solutions program to provide one-on-one assistance to underemployed immigrant and refugee professionals. With two years of funding appropriated by the Michigan legislature (under both Republican and Democratic majorities), the state has invested in relaunching the program through five local Michigan Works! agencies.
Contrary to popular belief, refugees possess valuable skills and talents that are beneficial to our society. In fact, this research demonstrates that 5.6 percent of refugees are employed in STEM jobs, a higher percentage than other immigrants at 5.2 percent and U.S.-born residents at 2.8 percent.
In spite of the fact that Michigan is home to 84,200 refugees, which is 0.8 percent of the overall population and little more than 10 percent of the total number of immigrants living in the state, the anti-immigrant crowd may try to lead people to believe that refugees are taking over the state. This is far from the truth. Refugees contribute to Michigan’s economy with an impressive $1.7 billion in annual spending and $197.3 million in state and local taxes. Refugees help create jobs and stimulate economic growth, leading to a stronger and more prosperous Michigan. A 2017 economic impact report from Global Detroit — the nonprofit economic development organization focused on building an immigrant-inclusive regional economy — not only chronicled the economic contributions of refugees in Southeast Michigan from more recent arrivals, but highlighted the contributions that refugee entrepreneurs have made in creating jobs for Michigan residents.
When it comes to researching the socio-demographic development and cultural and educational impact of refugees on the United States, the quantitative research does not quite capture the full picture. It focuses on the economic data, but fails to recognize the tremendous social and cultural contributions that refugees make in the form of art, food, music, education and creative thinking. In fact, you can witness these contributions of non-U.S.-born populations throughout Metro Detroit, in areas like Southwest Detroit, Hamtramck, Warren, Sterling Heights, Southfield, Troy, Dearborn and Dearborn Heights.
Michigan is at the forefront of developing state and local policies that welcome and integrate refugees. Recently, the State Office of Global Michigan awarded operating grants to three refugee resettlement collaboratives in Southeast, Mid- and West Michigan. Global Detroit was awarded the contract as the lead agency for the Southeast Michigan Refugee Collaborative, a multi-sector network of private and public entities across Macomb, Oakland, Washtenaw and Wayne Counties working together to create more robust support systems for people seeking refuge and safety. By proactively connecting refugee resettlement agencies, nonprofit social service providers, local government and the private sector, our region can help speed the process of integration and improve outcomes. Additionally, the Michigan legislature recently appropriated $3 million for a New Michiganders Fund to help fund legal, social and other critical integration services for new arrivals.
We can celebrate our nation’s historic role in welcoming refugees and those eager to pursue the freedoms and opportunities embodied by the American Dream. The new research from the American Immigration Council clearly demonstrates that refugees are not a burden to the United States but rather an often unrecognized economic asset who foster job creation and combat our nation’s population challenges. At a time when the United States is competing on a global scale for talent in the mobility, technology, manufacturing and healthcare industries, it is essential to utilize every available public policy to ensure our economic future. Refugees embody the American Dream, and a robust policy of welcoming refugees bolsters the economy and upholds our commitment to human rights.
— Tariq Fanek is the director of neighborhood development for Global Detroit and a current U.S. Global Leadership Coalition Fellow.