A project of the Partnership for a New American Economy
Kentucky’s population grew by almost 300,000 between 2000 and 2010, and almost one in four of the newcomers to the state were immigrants. This influx almost doubled the state’s population of foreign-born residents, bringing new businesses and an expanded science and engineering labor pool that helped bolster the state’s economy.
Size of foreign-born population (2013)
Percent of state’s population that is immigrant
Growth in foreign-born population 2000-2013
Top countries of origin
Between 2008 and 2018, science, technology, engineering, and math (STEM) fields are projected to play a key role in US economic growth, adding jobs 73 percent faster than the rest of the economy. For Kentucky, fixing the US immigration system so that it is easier for students trained in America to remain in the country after graduation will be critical: in 2009 more than 29 percent of students earning Master’s or PhD degrees in STEM from the state’s research-intensive universities were foreign-born. Almost 80 percent of Kentucky’s engineering PhD graduates are foreign-born.
Share of STEM graduates at state's most research-intensive schools who are foreign-born (2013)
Share of STEM PhDs who were temporary residents (2013)
Share of Engineering PhDs who were temporary residents (2006-2010)
Foreign-born students create jobs for Kentuckians and often provide the technological innovations that drive economic growth in the state. A recent study by the Partnership for a New American Economy and the American Enterprise Institute found that for every 100 foreign-born graduates of a US Master’s or PhD program who stay in the United States working in a STEM field, 262 jobs are created for Americans. That translates into an employment boost for Kentucky, a state where, in 2010, more than one out of every eight STEM workers with an advanced degree was foreign-born. By 2020, Kentucky will need to fill 66,600 new STEM jobs and immigrants will play a key role in occupying these positions and continuing to promote economic growth.
Immigration Reform = Economic Growth in Kentucky
Reforming our immigration system will generate millions of dollars and thousands of jobs across Kentucky. According to Regional Economic Models, Inc. (REMI), undocumented immigrants who enroll in a legal path to citizenship will generate more than 4,100 jobs and more than $334 million for the state by 2020. Expanding the number of both high-skilled (H-1B) visas will also have positive economic effects. The new H-1B visas awarded to Kentucky between 2010 and 2013 will translate into 2,495 new jobs for U.S.-born workers in the state by 2020. REMI estimates that expansion of the H-1B program would result in more than 1,700 jobs and add more than $146 million to Gross State Product by 2014.
In Kentucky, creating a path to citizenship and expanding the high-skilled visa program would add a total of more than $217 million to Gross State Product in 2014.
In addition to providing valuable support to Kentucky’s workforce, immigrants, specifically Hispanics, are also contributing to Kentucky's economy. A recent study by the Partnership for a New American Economy found that Hispanics account for $1.2 billion in Kentucky’s spending power. Hispanics also contributed $459 million in combined federal, state, and local taxes. A total of $211 million of those taxes went to Social Security and $49 million was paid to the Medicare trust fund.
Immigrants are helping to grow housing wealth in some key Kentucky counties, as well. Between 2000 and 2010, more than 18,000 immigrants arrived in Jefferson County, the area that includes the city of Louisville. By moving into neighborhoods formerly in decline, these immigrants played a role adding to the housing wealth of the neighborhood’s residents. That influx of immigrants added $2,083 to the value of the average home in the county, or more than $644 million to housing wealth there overall.
Immigrants have been integral in helping Kentucky grow economically in recent years, especially as the state has struggled, along with the rest of the country, to drive new business and create American jobs. Kentucky’s foreign-born business owners generate 5.4 percent of the state’s business revenues in 2010 despite owning just 3.8 percent of the state’s business.
Share of businesses in Kentucky owned by immigrants
Annual business income generated by immigrant-owned businesses
As in many states, anti-immigration sentiments have recently strengthened in Kentucky. One example of this is ‘Bill 6,’ which the state senate passed in 2011, an Arizona-style immigration law that gives police sweeping powers to question and detain anyone they suspect is in the US illegally.
However, once a fiscal-impact study by the Kentucky State Legislature’s non-partisan staff revealed the bill would cost Kentucky a net $40 million a year in court, prison, and foster-care costs, the Kentucky house voted overwhelmingly to reject it. In 2011, the state senate yielded on a separate immigration bill that would have forced major agriculture and construction companies to find many new seasonal workers. One estimate forecasted that if Kentucky lost its undocumented immigrant population, it would lose $1.7 billion in economic activity, $756.8 million in gross state product, and 12,059 jobs.
In part because of some of the challenges students face remaining in the state after graduation, Kentucky is also currently short of the professional workers it needs in critical STEM areas, fields that help the state’s economy remain innovative and competitive. According to the nonpartisan advocacy group Change the Equation, from 2009 to 2011 some 1.45 STEM jobs were posted online in Kentucky for every one unemployed STEM worker in the state.
Ratio of STEM jobs to unemployed STEM workers
Number of physicians per 100,000 residents
Share of physicians who graduated from foreign medical schools (2012)
Physician density rank relative to other states
Share of active physicians who are over age 60
Kentucky H-2B Visas (FY 2011)
However, the H-2B visa can be costly and cumbersome to attain. The average employer spends $2,500 for each H-2B visa it sponsors, and applies to multiple federal agencies in the process. With a more streamlined visa program, job creation in the state could be greater.
At the city level, Louisville’s Mayor Greg Fischer believes in immigrants’ contributions to Kentucky. "We want Louisville to be an international city, welcoming not only the refugee but also the Ph.D," Fischer has said.
In 2011 Fischer appointed Indian immigrant and local entrepreneur Suhas Kulkarni to lead the city’s recently created Office of Globalization. Kulkarni emigrated to Louisville from India in 1985 and opened a grocery store in its Germantown neighborhood. Shortly afterward, he founded Omnitrade International in the back of his store and today it is a global supplier of industrial mining and earth-moving equipment.
The Office of Globalization works to create greater incentives for international businesses to invest in Louisville, while helping Louisville’s businesses expand internationally. It also facilitates Louisville immigrants’ orientation to and engagement with their city through collaboration with local charities, businesses, and government offices. "The Office of Globalization is really one of the most critical initiatives of our city at this point," Kulkarni said. "We have all the great assets known worldwide such as UPS, Yum! Brands, the Kentucky Derby... we need to leverage those assets in a focused, international manner.
Immigrants are helping to grow the US economy everywhere, not just in the places—like our biggest cities—that we expect. They are helping to fill labor shortages on America’s farms, starting businesses that employ US workers, and developing the cutting-edge products that make America the world’s preeminent innovation hub.
Click on a state to learn more about the contributions immigrants are making to the local economy.