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Federal Reforms Could Help NJ’s Immigrants Contribute Even More to State Economy

Collecting back taxes from undocumented immigrants, for instance, could mean a big bump in tax collections

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New Jersey’s immigrants are creating thousands of jobs and contributing billions of dollars in tax revenue, but they could be doing even more for the state economy with comprehensive immigration reform at the federal level, according to a new report.

Released by the bipartisan pro-reform group New American Economy, the report provides an in-depth and well-rounded economic analysis of New Jersey’s foreign-born population, which at more than 20 percent of all residents, is the third largest of any state’s, behind only California and New York.

The report also doesn’t shy away from sensitive topics like illegal immigration, arguing that New Jersey’s undocumented residents would add to the more than $1 billion in taxes they paid in 2014 if Congress were to make paying back taxes part of authorizing an official path to citizenship.

The New Jersey economic analysis was one of 51 released by New American Economy last week as part of a coordinated nationwide effort to push for immigration reform in advance of a new congressional session next year. The group has also launched the #ReasonForReform social-media campaign to encourage supporters to record and send videos in support of immigration reform to members of Congress. Those efforts have already picked up a fair share of support in New Jersey from a Hispanic business-lobbying group and several regional business organizations.

While nearly 22 percent of New Jersey’s residents are immigrants, they make up just over 32 percent of the state’s population of entrepreneurs, according to the report. The businesses owned by New Jersey’s immigrants generated $3.2 billion in income in 2014 and employed over 270,000 workers.

Immigrants are also 40 percent more likely to be employed than the native-born population in New Jersey, and they represent 40 percent of the state’s overall workforce in the well-paid science, technology, engineering, and mathematics sector, the report said.

The group’s researchers also found that immigrants in New Jersey made a combined $74.2 billion in income in 2014, with $13.1 billion going to federal taxes and $6.5 billion contributed to state and local government in New Jersey. The state’s immigrants also put more than $9 billion into the federal Social Security and Medicare programs in 2014.

New Jersey’s undocumented immigrant population — a group estimated to be just under 500,000 residents – is also a big part of the state’s overall economy, earning nearly $10 billion in 2014. Undocumented immigrants in New Jersey also contributed an estimated $732 million in federal taxes and $432 million in state and local taxes. They do so because some are able to file official tax forms, using false Social Security numbers, with estimates ranging from between 50 percent to 80 percent. Many also pay state sales taxes and local property taxes.

On the expense side, the report found undocumented immigrants generally lack access to federal aid programs like Medicaid and food stamps and thus “draw down far less from these programs than their native-born counterparts.”

There are also 626,407 immigrants who are registered to vote in New Jersey, which is nearly 20 percent of the state’s total, the report said.

The push for immigration-policy changes comes as Democratic lawmakers in New Jersey have been working to improve upon a 2013 state law that enabled undocumented students to qualify for in-state tuition rates at public colleges and universities. Now, the lawmakers are calling for undocumented students to be allowed to apply for state financial-aid programs, arguing that the state will see a benefit in the long-run. So far, Gov. Chris Christie has opposed their efforts. The politics of immigration reform at the national level are also in gridlock, with the Republican-controlled Congress failing to take up any significant immigration changes even as President Obama, a Democrat, has been pushing for an overhaul of policy. In this year’s presidential election there’s also division, with Democratic candidate Hillary Clinton in favor of comprehensive reform, while GOP candidate Donald Trump calls instead for hardline positions, including the building of a massive wall on the Mexican border.

Christie, who sought the Republican nomination himself, has endorsed Trump’s candidacy and is also a close adviser to his campaign. But most New Jersey residents, according to the results of a Rutgers-Eagleton poll released last year, are not in sync with Trump’s call for a harsh crackdown on those who are here illegally. More than 60 percent of those polled said they supported creating a path to citizenship for undocumented residents. That result marked a more than 10 percentage point increase since 2012, when Rutgers-Eagleton polled on the same issue.

The supporters of New American Economy’s push for reform in New Jersey’s business community pointed to the economic benefits already provided to the state by its immigrant population as a reason for Congress to do more.

“Immigrants make up a significant portion of our workforce, especially in the technology industry, and our immigration system makes it too difficult for many highly skilled workers to come to the United States to contribute to our economy,” said Paul Boudreau, president of the Morris County Chamber of Commerce.

“We need to encourage and foster innovation, not discourage it,” Boudreau said. “It’s time for our congressional leaders to pass comprehensive-immigration reform so we can continue to foster innovation and grow our economy.”

“It is time for our leaders in Washington to work together to create real and meaningful immigration reform so the American dream can be a reality for more hardworking immigrants,” said Carlos Medina, the chairman of the Statewide Hispanic Chamber of Commerce.

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