Most opinion polls have shown that immigration has become a main election issue, and economist and Nobel Laureate Paul Krugman, on Friday, weighed on the merits of concerns around it.
What Happened: “Immigration is looming larger in the campaign, partly because it’s becoming harder for Republicans to run against Biden on the economy,” said Krugman in a post on X, formerly Twitter. “But there’s a strong case that immigration has been a key part of Biden’s economic success.”
To make his case, Krugman shared some data points, while suggesting that immigrants are the reason behind bringing down inflation.
“Inflation has come down so easily in part because of strong labor force growth,” he said, adding that all of that growth is attributable to foreign-born workers.
Inflation has come down so easily in part because of strong labor force growth. How much of that growth can be attributed to foreign-born workers? All of it 2/ pic.twitter.com/hqnQRXcaGw
— Paul Krugman (@paulkrugman) February 2, 2024
See Also: Best Inflation StocksImmigrants Help Instead Of Hinder: Krugman said that immigrants have not stolen jobs from Americans as has been widely perceived. He noted that the U.S. labor market is tight and that the country has full employment. The Conference Board’s survey showed that the consumers’ assessment of the labor market was very positive in January, he said.
The number of respondents saying jobs were plentiful was 45.5% in January, up from 40.4% in December and those saying jobs have been hard to get fell from 13.1% to 9.8%.
“So employment is being constrained by supply, not demand,” Krugman said.
“Foreign-born workers expand the supply. And lots of evidence that they are complementary to native-born workers, so that they let us run the economy hotter without inflation and hence *raise* native-born employment.”
Sharing a chart by the St. Louis Federal Reserve, Krugman noted that the relative wages of foreign-born workers have fallen a bit relative to those who are native-born since the pandemic.
Some evidence to that effect: relative wages of foreign-born workers have fallen a bit relative to native-born since the pandemic. That’s OK — they gain a lot from coming here, and their presence allows bigger gains for the native born 5/