Illegal immigration has been an issue in the United States for many years. Many citizens place blame on illegal immigration for the decline of the labor force and skilled trade jobs in the United States. It has been said that illegal aliens have come in and taken jobs for lesser pay than what would have been acceptable by citizens due to the cost of living and expenses associated with the typical family, and have driven down wages across the board. It is also assumed by many that many of the crimes committed in this country, ranging from the petty to the felonious in nature, are committed by illegal aliens, but that should not be interpreted as implying that all illegal aliens are criminals because that is simply not true. Another issue brought to light is the increased strain on our infrastructure as a nation regarding the benefits provided to illegal aliens such as free healthcare, lack of income taxes being paid, free education for their children all at an added cost which is generally covered by taxes taken from citizens. From a microeconomic perspective, illegal immigrants contribute positively to the economy by bringing specific skills to help aid in production while their jobs would not otherwise be filled. From a macroeconomic perspective, illegal immigrants add to the overall debt of the United States by receiving necessary government services while, in some but not all cases, failing to contribute payroll or income taxes, even though they do contribute state and local taxes on consumption.

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There are more than 11 million illegal immigrants in the US today and the impact they have on the economy can be perceived to be both positive and also negative (Johnson, 2013). There are various reasons to be concerned in regard to the increasing levels of illegal immigration. However, as the Congress considers the biggest changes to the immigration laws, it is critical not to lose the sight of the fact that illegal immigration contains clear economic logic: providing business in the US with the variety of workers they need, when they need them, and the location they need them (Hanson, 2009). If the policy reforms succeed in ensuring the US illegal immigrants more similar to legal immigrants in relation to skills, occupational mobility, and timing of arrival, it is expected to cause a decline instead of increasing the national welfare. The Congress as well as the administration requires being cautious that the economic costs do not outdo the putative benefits in their efforts in gaining control over the issue of illegal immigration. This microeconomic benefit goes directly to production. Illegal immigrants add to the diversity of skills in the United States, allowing the US to have an economy that is productive in a number of different sectors. These microeconomic benefits are palpable, and even when looking at the potential macroeconomic downside, it is critical not to lose sight of the microeconomic good.

From a macroeconomic perspective, illegal immigration also impacts the US incomes through its effects on public expenditure and tax revenues (Hanson, 2009). Illegal immigrants with low income and large families tend to cause a bigger drain on the public spending. Illegal immigrants pay income, sales, property, payroll as well as other taxes with the lower-skilled immigrants hence making smaller contributions. The illegal immigrants make use of public services by sending their children to public schools, driving on the roads and highways, demanding the protection of the police and the fire department, and receiving assistance from the state and the federal government. Making an addition of the pretax income gains from the immigration to the net tax contributions of immigrants, their tax payments is less the value of the government services they utilize allowing for a rough approximation of the total impact of the immigration on the US economy. Illegal immigration contributes to sluggish growth in some instances because it reduces the tax base. The United States is currently in a situation where it needs to increase its revenue base in order to spend more and stimulate long-term growth. Illegal immigrants are quite often paid under the table, and their work is not taxed in the way that other workers might be. This can lead to an economy that struggles to get its feet under it. Camarota (2013) writes that the influx of immigrants is small, so this effect may be mediated, but the effect still exists.

Changing the US immigration policy, which is currently being contemplated by the Congress, is expected to slow the illegal immigrants’ influx into the United States. It is anticipated that the policies will help in tightening the enforcement against the illegal immigration, help in expanding the number of temporary work visas which are available to guest workers, as well as revising the provisions for illegal immigrants to acquire legal status (Costa, 2014). The members of the Congress and including the policy makers are agreeing that putting enforcements on the border and the interior of the country needs to be expanded. Similarly, the subject of allowing legal immigration rather than illegal immigration is raising a lot controversy. Through the immigration policies, what does the US hope to achieve economically? According to Martin (2010), the optimal immigration policy should be committed in admitting only the individuals who are skilled and who can contributes tax to the economy. However, it is important to take into consideration the rule of and strengthening the ability of the US government in enforcing regulations on the labor market.

In conclusion, even though some specific groups of employers, workers, and taxpayers may gain or loss of the policies governing illegal immigration is altered, the average economic impacts of policy reforms does not appear to be significant. Generally, Illegal immigration increases the incomes of the United States residents by allowing the economy to make efficient use of the domestic resources but also raises debate on the net fiscal income illegal immigration has on the US economy. There are some macroeconomic downsides, including increased government spending and a decreased tax base, but the microeconomic benefits are difficult to ignore for those who want seek to understand the impact of illegal immigration on the US economy.

References
  • Johnson, H. (2013). Illegal immigration. Retrieved November 22, 2015 from http://www.ppic.org/content/pubs/atissue/AI_711HJAI.pdf
  • Hanson, G. (2009). The Economics and Policy of Illegal Immigration in the United States. Migration Policy Institute
  • Camarota, S. (2013). The Fiscal and Economic Impact of Immigration on the United States. Retrieved November 22, 2015 from http://www.jec.senate.gov/public/_cache/files/31c693c2-73cc-4e08-953f-b080292fc850/camarota-testimony-new.pdf
  • Costa, D. (2014). Facts About Immigration and the U.S. Economy. Economic Policy Institute. Retrieved November 22, 2015 http://www.epi.org/publication/immigration-facts/
  • Martin, J. (2010). The fiscal burden of illegal immigration on United States Taxpayers. Retrieved November 22, 2015 from http://www.fairus.org/DocServer/research-pub/USCostStudy_2013upd.pdf