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Q&A: The economic impact of suspending visas for international students

Jul 10 2020
Ran Abramitzky

Ran Abramitzky

Revoking visas from international students whose university classes move fully online this fall will reduce the ability of American universities to attract the brightest minds from all over the world and will result in the United States missing out on the bold ideas these students generate, says Stanford economist Ran Abramitzky.
Here, Abramitzky discusses the consequences of the recent announcement from the federal government that prohibits international students from remaining in the U.S. if they are enrolled in schools operating entirely online. According to Abramitzky, an economic historian who has studied the effects of immigration in the U.S., this decision will ultimately harm the country’s economy because these students are vital to its creativity and competitiveness.
Abramitzky also addresses other recent policy changes to curb immigration in response to the pandemic – including an executive order in late June that suspended several job-related nonimmigrant visas in an effort to preserve jobs for American citizens. But according to Abramitzky’s research, businesses are unlikely to react to these immigration restrictions by hiring more American workers or increasing wages. Instead, the more likely outcome is that jobs will be outsourced and replaced with AI technology, he said.
Abramitzky is a senior fellow at the Stanford Institute for Economic Policy Research (SIEPR), and a professor of economics in the School of Humanities and Sciences.
Let’s start with the most recent announcement from the U.S. Immigration and Customs Enforcement (ICE) stating they will strip international students of their visas if they are enrolled at schools whose courses are run entirely online this fall. What are some of the unintended consequences that could arise as a result of this decision? 
Suspending visas for international students will be very disruptive for these students’ lives; it will also be very disruptive to universities as international students are essential to their core mission. More broadly, it will harm the U.S. economy, as international students are important to the creativity and competitiveness of the U.S. In the long run, it will reduce the ability of American universities to attract bright people from all over the world, reduce the competitiveness of American universities and we will miss out on all the great new ideas these students generate.
You work closely with international students. How do you see this policy impacting your own work as a professor?
International students are an important part of the community – they enrich the classroom, they broaden our perspectives and they bring experience and skills that extend the set of research questions we can tackle. Our graduate students also serve as teachers and teaching assistants for our undergraduate courses, so stripping their visas will sacrifice our undergraduate program by making less teachers available. My own international graduate student advisees went on to find impressive jobs in academia, business, and government. Some became professors at universities like Harvard, Northwestern, U Penn, UCLA and UC Davis, others became economists at institutions like the World Bank. Some joined industry, some started their own companies and some became academics and leaders in their home countries. It is hard to see how such immigrants hurt the American economy.
Monday’s announcement is just one of several recent moves by the Trump administration to curb immigration. The reason cited was to protect jobs for American citizens. Does your research support this claim?
The last few weeks make it clear that the administration intends to severely curtail nearly all immigration. In addition to ICE’s announcement this week, Trump also recently signed an executive order halting immigration by those with H-1B, J-1 and other skilled workers visas.
Economic research strongly suggests these actions won’t protect American workers. My long-term collaborator Leah Boustan of Princeton and I have spent more than ten years using big data to study the consequences of curtailing immigration. What we’ve found (often with other coauthors) is that too many claims about today’s immigrants ignore facts and evidence.
For example, we studied what happened the last time the US closed its borders to immigrants. In the 1920s, Congress cut immigration to the U.S. by more than 80 percent, claiming these restrictions were needed because immigrants were taking jobs from Americans. But the policies didn’t have the effect Congress intended, and U.S.-born workers didn’t end up with higher-paying jobs. Instead, industries like mining that relied on immigrant workers were unable to attract new workers and shrunk, while other industries, like agriculture, reacted to a lack of workers by moving toward automation.
It’s especially important to mention that while the 1920s quotas resulted in fewer scientists coming to the U.S., research by colleagues at NYU shows that they also reduced innovation among U.S.-born scientists. Furthermore, research that looks at the H1-B program, specifically, suggests that high-skilled immigrants often create new job opportunities for U.S. workers, not fewer.
Overall, our research suggests that U.S. businesses are unlikely to react to immigration restrictions by hiring more American workers or increasing wages. We’re much more likely to see jobs being outsourced and workers being replaced with AI technology.
What are some public misunderstandings or misperceptions surrounding immigration into the U.S. that your research has uncovered?
Many people hold the view that immigrants today are slow to integrate into the U.S. economy and society. There is a nostalgic view that European immigrants assimilated into our economy and society more quickly than immigrants today. Our research suggests that this view is unwarranted. We find that despite the large changes in immigration policy and in the countries immigrants hail from (in the past immigrants came primarily from Europe; today they come primarily from Latin America and Asia), immigrants today integrate into the U.S. economy and society just as quickly as past immigrants.
In a study that uses Census data on millions of immigrants spanning more than 100 years of U.S. history, we find that immigrants today – no matter what country they come from – are no slower to move into the middle class than immigrants from 100 years ago. In fact, both today and in the past, children of the poorest immigrants move up the economic ladder faster than their peers born in the U.S. If we limit immigration now, we’ll miss out on generations of academics, entrepreneurs and inventors.
In another study, we similarly find that immigrants today “assimilate” into the US society just as quickly as immigrants in the past.
Taken together, our research suggests that severely restricting immigration will have negative consequences and that it would be a mistake to design immigration policy based on the assumption that immigrants don’t integrate into the U.S. economy and society.

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