Despite high inflation and interest rates, the US economy is expected to avoid a recession thanks to the surge in immigration. Official government data on population growth is often slow to report and does not include undocumented immigrants. However, in the first half of 2023, over 545,000 people gained lawful permanent resident status, with many finding work in lower-wage industries like hospitality and retail. Additionally, encounters with undocumented migrants reached a record high in December of that year.
The influx of new foreign-born workers has helped fill low-wage jobs and contribute to job growth, which in turn supports economic growth. By keeping a lid on wage growth, the presence of cheap workers has also helped limit inflation. While acknowledging the chaotic nature of the current immigration system, JPMorgan Asset Management’s strategy chief believes it has widened the runway for a soft economic landing and made it easier to achieve stability.
The surge in immigration has played a significant role in bolstering the economy and preventing a recession. Despite the challenges presented by a chaotic system, the influx of inexpensive workers has provided crucial support for economic growth and stability.
