The latest research by Goldman Sachs economists has shed light on the potential consequences of U.S. immigration policies following the upcoming election. In 2020, net immigration to the U.S. soared to approximately 2.5 million individuals, significantly bolstering labor force and GDP growth, while also helping to mitigate wage pressures. Looking ahead to 2024, Goldman Sachs forecasts that net immigration will reach around 2 million, doubling the rate seen before the pandemic.
President Biden’s recent changes, announced on June 4, seek to restrict a pathway that could potentially see 700,000 immigrants entering the country annually. Despite this, Goldman economists believe that the actual impact will be far less significant, as affected immigrants are likely to explore alternative entry methods. Moreover, legal challenges may impede the implementation of these new rules entirely.
Should President Biden secure a second term, it is anticipated that his administration will retain existing immigration policies with minor modifications. The current asylum limitations, aimed at curbing unauthorized immigration, face legal and operational hurdles. These restrictions include a daily cap of 2,500 unauthorized migrants encountered outside official entry points, with any surplus individuals being sent back across the border. Given that the daily average exceeded 3,500 in May, this restriction is expected to be promptly enforced.
Certain groups, such as unaccompanied children and victims of trafficking, are exempt from these restrictions. Asylum seekers at official ports of entry are not affected either, prompting many to reconsider their entry strategies.
In contrast, a hypothetical second term for President Trump would likely witness more stringent immigration constraints. The potential outcomes under this scenario vary widely due to possible policy shifts and legal battles. Goldman Sachs presents two key scenarios for net immigration under Trump:
**High-End Scenario:** If courts block significant changes to asylum policies and curb deportation efforts, net immigration might drop to roughly 1.5 million in 2025. Despite this decline, the number remains twice the average reported by the Congressional Budget Office (CBO) between 2017 and 2019.
**Low-End Scenario:** If the Trump administration successfully enforces drastic reductions in asylum claims and humanitarian parole, combined with an intensified deportation campaign, net immigration could dip below the 2017-2019 annual average of 700,000, possibly even approaching zero temporarily. Nevertheless, economists argue that it is improbable for net immigration to turn negative annually, even in this scenario.
One of the most uncertain aspects of the Trump administration’s proposed policies is the extent of potential deportations. Estimates suggest that removals could range from 300,000 to a staggering 2.1 million by 2025. Such variability underscores the wide spectrum of potential outcomes linked to immigration policies depending on the election results.
The future of U.S. immigration policies is fraught with complexities and uncertainties. The decisions made in the coming years will undoubtedly shape the demographic landscape of the country and have far-reaching implications for the economy and society as a whole.