More Lost Chances on Immigration Reform Hurt the U.S. Economy

Despite their divisions, Democrats and Republicans this year found common ground over the need to compete more vigorously with China. The two parties passed the Infrastructure Investment and Jobs Act (IIJA) and the CHIPS and Science Act, together investing over a trillion dollars in efforts to expand broadband, improve transportation, and bolster critical industries such as semiconductors. Yet in the face of a historic labor shortage that is jeopardizing those goals, the two parties once again missed the opportunity to fix the United States’ increasingly broken immigration system.

The lame duck period in Congress—before Democrats lose their slim majority in the House of Representatives when the 118th Congress begins on January 3—was the latest chance for meaningful immigration reform; instead, it became one more page in a two-decades-long catalogue of failure. Three bills, each with some level of bipartisan support, promised fixes to long-standing problems. One would have sped up the path to green cards for many on temporary employment-based visa like the H-1B; another would have legalized Dreamers—young people brought to the country illegally by their parents—while trying to mend an overwhelmed asylum system; the third would have legalized undocumented farmworkers, helping farmers who are starving for labor. By letting all three bills die before even seeing a vote, both parties showed that they would rather keep immigration as a political issue than take the risk of attempting serious reforms.

In the long history of failed efforts at immigration reform, it is hard to find a bigger missed opportunity. Federal Reserve Chair Jerome Powell estimates there are 3.5 million fewer workers in the workforce now than if pre-pandemic trends had continued. The shortage is a product of a mixed set of causes, including early retirements, child care challenges, and lasting health concerns pertaining to the pandemic. Immigrants used to fill these jobs in larger numbers, but immigration slowed sharply due to Donald Trump-era policies and the pandemic. The high level of job vacancies—over 10 million jobs remain unfilled—puts the U.S. labor market exceedingly out of balance. As professors Matthew Slaughter and Gordon Hanson argue, “without these workers the U.S. economy can find itself in knots.”

All three proposed measures would have helped the United States address challenges to its competitiveness. The Eagle Act sought to end discriminatory country caps on employment-based green cards. Currently, no more than 7 percent of employment-based visas each year (capped at 140,000, which the bill would not have changed) can go to applicants from a single country of origin. This means applicants from large countries like India and China get stuck in backlogs that can span decades. Would-be immigrants, like those on the H-1B visa for highly skilled workers, remain under-employed for years, restricted from changing jobs and unable to build their lives and careers in the United States. The Eagle Act has received bipartisan support before; different iterations of the bill have passed easily in the House twice and in the Senate by unanimous consent. But when it was brought to the House floor this December, debate about applicant diversity, increased wait times for other immigrant groups, and concerns that this compromise could lead to an increase in the total number of green cards caused support for the bill to crumble. Nativist groups like the Federation for American Immigration Reform lobbied against the bill, and Republican support disappeared entirely. Democratic Party caucuses also split over the issue; the American Immigration Lawyers Association, despite claiming to be “an ardent supporter of the elimination of the per-country limitations for employment-based immigrants,” opposed the bill.

The same fate awaited the proposal negotiated by Senators Krysten Sinema (I-AZ) and Thom Tillis (R-NC) that would have created a pathway to legalization for Dreamers, while also promising billions in border security funding, reforming the asylum system, and extending Title 42—the pandemic restrictions on asylum seekers crossing U.S. borders—for an indefinite period of time. Overhauling the U.S. asylum system is a herculean challenge. The current structure for determining the legitimacy of asylum claims is hopelessly overburdened, creating an incentive for even those with weak claims to take risky journeys to reach the United States. The extension of Title 42 and the bill’s proposed acceleration of asylum processing, however, could have threatened those with stronger claims. But these are long-standing challenges, and the two parties once again refused any serious effort to address them. Republicans continued to insist that they won’t compromise on any aspect of immigration reform until the “border crisis” is dealt with. At the same time, the proposed asylum reforms in the deal made it difficult for some Democrats to swallow. The result, yet again, is that nearly two million Dreamers who have lived most of their lives in the United States remain in limbo, not permitted to contribute to the U.S. economy at their full potential and one court decision away from the renewed threat of deportation.

Even legislation aimed solely at addressing labor shortages, such as the effort to create a citizenship pathway for migrant farmworkers with a demonstrated history of farmwork and revise the H-2A visa program to permit year-round work, failed to make its way through the Senate. Agriculture is one of the sectors most affected by labor shortages. The Department of Labor estimates that 49 percent of all farmworkers are undocumented. The proposal, championed by Senator Michael Bennett (D-CO), would have helped secure a more stable farm labor force for the future. The House passed a similar bill last year with two dozen Republican votes, but, like the others, it was dropped from the lame duck’s omnibus year-end bill. The bill had strong industry support, especially from labor-intensive sectors such as tree fruits, but the powerful American Farm Bureau Federation opposed the measure, arguing it would increase regulatory burdens.

The failures are especially costly this time around because there is no hope for progress on immigration in the next Congress. The likely incoming House Speaker Kevin McCarthy (R-CA) has said he will refuse to consider any “amnesty” proposals while Republicans control the House. In doing so, the Republicans will keep alive an issue that is sure to play prominently in the 2024 presidential race; Democrats too will be able to rally their supporters. But the country is the loser. Roberto Suro, a journalist who has chronicled many of the previous immigration reform failures, predicts the unsolved problems will only get worse. We are facing, he warns, “an era of mounting chaos, economic losses and tragedy”—one that Congress had the power to prevent, but once again refused to rise to the task.