A project of the Partnership for a New American Economy
New York’s history as the storied entry point to the United States has no doubt contributed to its rich immigrant culture, and as in other states, New York’s immigrant population continued to grow over the past decade. Immigrants make up close to one in four people in the state, totalling more than 4 million. They also make up a substantial portion of New York’s workforce – 27.3 percent in 2010, according to the US Census Bureau. The immigrants in New York are also increasingly pursuing higher education. According to the Migration Policy Institute, the number of immigrants in New York with a college degree increased by 33.7 percent between 2000 and 2009.
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 (or STEM) fields are projected to play a key role in US economic growth, adding jobs 73 percent faster than the rest of the economy. Fixing the US immigration system to make it easier for students trained in New York to remain in the country after graduation will be critical to ensuring that New York stays competitive in STEM job growth. 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 stays in the United States working in a STEM field, 262 jobs are created for Americans. That translates into a huge employment boost for New York, a state where, in 2010, 20.9 percent of STEM workers with an advanced degree were foreigners. Also, in 2013, more than 50 percent of the students earning Master’s or PhDs in STEM from the state’s research-intensive universities were foreign-born. And almost 70 percent of the students earning engineering PhDs in the state in recent years were also noncitizens. By 2020, New York will need to fill 373,060 new STEM jobs and immigrants will play a key role in occupying these positions and continuing to promote economic growth.
Share of STEM graduates at the state’s most research-intensive universities who were foreign-born (2013)
Share of engineering PhD recipients who were temporary residents, 2006-2010
New York’s immigrants also contribute to the state’s economic growth and competitiveness by earning patents on cutting-edge research and products. In 2011, more than 65 percent of patents awarded to Cornell University had at least one foreign-born inventor. Almost half of Cornell’s patents that year had a foreign-born inventor who was a student, postdoctoral fellow, or researcher. Often these patents are licensed to existing companies or used as the foundations for new ones, creating revenue and jobs.
Immigration Reform = Economic Growth in New York
Reforming our immigration system will generate millions of dollars and thousands of jobs across New York. In the New York City metropolitan area, 2007 and 2008 H-1B visa denials cost U.S.-born tech workers as many as 28,055 additional jobs and as much as $470,540 in missed wages by 2010. According to Regional Economic Models, Inc. (REMI), undocumented immigrants who enroll in a legal path to citizenship will generate more than 29,000 jobs and more than $2.8 billion 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 New York between 2010 and 2013 will translate into 59,012 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 21,600 jobs and add more than $2.3 billion to Gross State Product by 2014.
In New York, creating a path to citizenship and expanding the high-skilled visa program would add a total of more than $2.9 billion to Gross State Product in 2014.
In addition to providing valuable support to New York’s workforce, immigrants, specifically Hispanics, are also contributing to New York's economy. A recent study by the Partnership for a New American Economy found that Hispanics account for $43 billion in New York’s spending power. Hispanics also contributed $16.6 billion in combined federal, state, and local taxes. A total of $7.4 billion of those taxes went to Social Security and $1.7 million was paid to the Medicare trust fund.
Immigrants are helping to grow housing wealth in some key New York counties as well. Between 2000 and 2010, more than 6,716 immigrants arrived in Bronx County. 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 $6,716 to the value of the average home in the county, or more than $3.2 billion to housing wealth there overall.
As with the rest of the country, immigrants play a significant role in driving economic growth and job creation through new business startups in New York: today, immigrants are starting more than two out of every five new businesses in the state. And from 2006 to 2010, 31.2 percent of business owners in New York were immigrants, despite making up 22.2 percent of the state’s total population. From 2006 to 2010, immigrant owned businesses also generated more than $12.5 billion in annual income for the state each year.
Share of businesses owned by immigrants
Total business income generated by immigrant-owned businesses
Immigrant entrepreneurs have long made significant contributions to New York’s economy. Immigrants founded two of the state’s largest companies, Pfizer and Verizon. Forbes Magazine, a top business publication based in New York, was also founded by an immigrant. Together, these three companies employ almost 300,000 people today and bring in more than more than more than $177 billion in revenues each year.
Due in part to some of the challenges students face remaining in the state after graduation, New York is 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 almost 1.7 STEM jobs were posted online in New York for every unemployed STEM worker in the state. Fixing this problem is critical to a state like New York, which is home to a host of major technology companies, including Verizon, ITT, and CA Technologies.
New York may also need to recruit immigrants to address a coming shortage of medical professionals. By the year 2030, the federal government estimates that the state will be short more than 39,696 registered nurses, leaving almost 24 percent of RN positions vacant due to a lack of qualified workers. Potential physician shortages are also a concern in New York State. According to the Healthcare Association of New York State’s Physician Advocacy Survey, hospitals currently need 1,000 new physicians, a number expected to increase in the coming years. Immigrants are already playing a major role filling these labor gaps: in 2012, almost two out of every five physicians in New York were graduates of foreign medical schools, the second-highest proportion in the country. Graduates of foreign medical schools tend to be overwhelmingly immigrant.
Nursing shortage by 2030
Share of nursing positions vacant by 2020
Share of physicians who graduated from foreign medical schools, 2012
According to a study by the Center for American Progress and the Partnership for a New American Economy, New York would also benefit significantly if Congress passed the federal DREAM Act, a bill that would legalize the 2.1 million undocumented immigrants brought to the US as children. In New York, legalizing the 105,000 so-called DREAMers in the state would have an estimated $16 billion induced economic impact and also create almost 53,500 new jobs by 2030. These benefits would result from incentivizing these young people to earn higher education degrees and allowing them to work legally, which in turn leads to higher earnings and increased spending on products ranging from cars to houses to computers.
DREAMers in the state
Economic impact of passing the DREAM act
Number of jobs created by DREAM act by 2030
Immigrants in New York are also helping to create jobs in the state through seasonal and temporary work. Between 1990 and 2010, New York's supply of less-skilled workers born in the U.S. dropped by 1,239,639. Over that same period, the state's foreign-born, less-skilled labor force grew by 499,648, leaving a difference of 739,991 openings that immigrants could be filling. According to the US Department of Labor, New York employers were granted certifications to bring in more than 3,500 workers on H-2B visas in fiscal year 2011. These visas, often used to staff places like amusement parks, hotels, or landscaping services during peak season, have a powerful job creation effect. One study by the Partnership for a New American Economy and the American Enterprise Institute found that for every 100 H-2B visa workers, 464 jobs are created or preserved for American born workers. In New York the 3,500 visas authorized in FY 2011 supported more than 16,600 American jobs.
New York 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.
Aslaug Magnusdottir, a former corporate lawyer from Iceland, arrived in the United States for graduate school. She has since become one of many immigrant entrepreneurs in New York’s fashion industry. After working for Bloomingdales and Gilt Groupe, Magnusdottir noticed a gap in the fashion market. There was, she says, the customer who loves the runway pieces and the designer who wants to sell them, but production costs are high and traditional retailers see those purchases as risky, so a lot of pieces go unproduced.
Aslaug founded Moda Operandi, a Website that works directly with designers to sell pieces by pre-order that would not have otherwise been produced. When the site launched in February 2011, it catered mostly to American customers, but soon it gained an international customer base; today American designers use it to export their products abroad. “Designers don’t get exposure in those distant markets,” she says. “Coming from a small country where there’s no access to fashion, that was something I was passionate about.” This year, Aslaug expects that 30 percent of Moda Operandi’s sales will be international, sending merchandise to the UK, Australia, Canada, and the Middle East.
Despite her success as an entrepreneur, Magnusdottir has faced visa problems. After earning an MBA in America, Magnusdottir was forced to leave after graduation because she did not have a visa. When she met and married an American abroad, she moved back to the US only to learn that her previous student visa (the J-1) required that she spend two full years back in Iceland before she could apply for a green card-- an issue since she had not moved back home. Aslaug was able to secure an O-1 visa for extraordinary individuals and has been able to renew it and remain in America, but it is only a temporary solution. The US government has denied her application to have the two-year stay waived twice, despite Iceland’s support of the waiver.
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.