1
Unauthorized Immigrants:
Implications for the U.S.
Population, Economy, and
Social Security
August 6, 2015
SSA Retirement
Research Consortium
Steve Goss, Office of the Chief Actuary
Social Security Administration
Net Immigration (legal and unauthorized) has
augmented the birth rate
2
Historical and Projected Total Fertility Rate and
Augmented Total Fertility Rate to Include Net Immigration: U.S.
4.5
4
3.5
3
2.5
2
1.5
1
0.5
0
1940
1950
1960
1970
1980
1990
2000
2010
2020
2030
2040
2050
2060
2070
2080
2090
Foreign Born Residents:
3
1)Naturalized Citizens
2)Legal Permanent Residents (LPR)
3)Other-than-LPR (OTL) (14.0 million in 2014)
a)Temp Visas (non-immigrants) (1.7 million)
b)Temp Visa Overstayers (1.2 mill in 2014)
c) Never legally authorized (11.1 million)
4)“Unauthorized”--3b+3c
(12.3 million)
Unauthorized contribute to the
Economy---and to Social Security
4



Unauthorized can only be estimated
 Highly uncertain imputations and residuals
We assume roughly same LFPR by age, sex, child presence
 Higher births increase male LFPR, lower female
Estimates for 2010---http://www.ssa.gov/OACT/NOTES/pdf_notes/note151.pdf
 12.6 million OTL, 8.3 million employed
 10.8 million unauthorized, 7.0 million employed






0.6 million employed visa overstayers
0.7 million employed with fraudulently obtained ID
1.8 million employed, reported to suspense file
3.9 million employed in underground economy
Estimate 3.1 million unauthorized paid $13 billion to OASDI in 2010
Estimate 0.2 million received $1 billion in OASDI benefits in 2010 based
on unauthorized work
Employment of Unauthorized
5

We assume average taxable earnings at about 80
percent of that for all workers
 Assume

higher if become authorized
Employment rate elasticity to econ conditions? Lower
due to fewer income substitutes
 Less
likely to have UI coverage
 Not eligible for SSI or OASDI
 So more need to accept inferior employment

However, there is another elasticity------
Size of Unauthorized population is elastic—making
employment rate appear less elastic
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Recent Unauthorized Population at End of Year in millions
versus
Total Population Unemployment/Underemployment Rates
14
12
10
8
6
UnauthorizedPop
4
UnempRate
2
UnderemployRate
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
0
Large Net Inflow Post-IRCA Ceased
with Recent Recession
7
Emigration of Unauthorized will
continue to rise Post-IRCA
8
As the Unauthorized Population “Matures” PostIRCA Emigration will Increase
9
Projected Unauthorized Population at End of Year in millions
25
20
UnauthorizedPop
15
UnempRate
UnderemployRate
10
5
2081
2071
2061
2051
2041
2031
2021
2011
2001
0
Age Distribution Extends Post-IRCA; As
Young New Arrivals Age
10
Distribution of "Unauthorized" Population by Age
500,000
400,000
2050
300,000
200,000
2010
100,000
0
0
10
20
30
40
50
60
70
80
90
100
Our Estimates for Proposals
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

Comprehensive Reform

S.744 (Rubio) Passed by the Senate in 2013

http://www.ssa.gov/OACT/solvency/MRubio_20130628.pdf
President’s Executive Actions


2012 DACA—children under 30
2014 Actions
 Enforcement
 Expand DACA ---------------Held up by Court since May 2015
 Add DAPA (Parents) -------Held up by Court since May 2015
 Entrepreneurs
 Et cetera
 http://www.ssa.gov/OACT/solvency/BObama_20150202.pdf
Comprehensive S.744 (June 2013)
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


Broad legalization of unauthorized—like IRCA
Expansions of legal limits on immigration
Projected increases in:







Population;
1.9% in 2024, 3.5% in 2050
Employment; 2.1% in 2024, 3.5% in 2050
GDP;
2.1% in 2024, 3.5% in 2050
Taxpayers;
3.8% in 2024, 5.3% in 2050
OASDI Tax; 3.3% in 2024, 4.8% in 2050
OASDI Cost; 0.1% in 2024, 3.2% in 2050
Would reduce 75-year OASDI actuarial deficit
by 0.21% of taxable payroll
Executive Actions (2012, 2014)
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


Legalization of some unauthorized—not to citizenship
Minor expansion of legal limits---entrepreneurs
Small Projected increases in:







Population;
0.1% in 2024, 0.2% in 2050
Employment; 0.2% in 2024, 0.2% in 2050
GDP;
0.2% in 2024, 0.2% in 2050
Taxpayers;
0.5% in 2024, 0.5% in 2050
OASDI Tax; 0.4% in 2024, 0.4% in 2050
OASDI Cost; 0.0% in 2024, 0.5% in 2050
Would reduce 75-year OASDI actuarial deficit
by 0.01% of taxable payroll
For Further Information
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
2015 OASDI Trustees Report
http://www.socialsecurity.gov/OACT/TR/2015/tr2015.pdf

Actuarial Note, Number 148
http://www.socialsecurity.gov/OACT/NOTES/pdf_notes/note148.pdf

Actuarial Note, Number 151
http://www.socialsecurity.gov/OACT/NOTES/pdf_notes/note151.pdf

Demographic Assumptions
http://www.socialsecurity.gov/OACT/TR/2015/2015_Long-Range_Demographic_Assumptions.pdf

Model Documentation
http://www.socialsecurity.gov/OACT/TR/2015/2015_LR_Model_Documentation.pdf