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Report: Mass Deportation Could Cost Texas Billions

A new study by the Center for American Progress says that in Texas alone, there would be a $14.5 billion annual loss in tax revenue if all illegal immigrants in the state were deported.

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A study released Thursday by the Center for American Progress concludes that the Texas economy would suffer a net economic loss in the billions if group deportations of illegal immigrants occurred at even moderate levels.

The progressive think tank concluded that even if as few as 15 percent of Texans living in the state illegally were removed at once, it would mean an annual $11.7 billion loss for Texas’ gross state product, increasing to more than $77 billion if all 1.65 million estimated illegal immigrants were removed from the state.

There are currently 24.3 million Texans, about 6.8 percent of whom are illegal immigrants, according to the center, which uses 2010 population estimates by the American Community Survey and the U.S. Census Bureau. It also uses data from the Pew Hispanic Center to determine the illegal immigrant population.

The study also estimates that removing the illegal immigrants would result in a loss of about $14.5 billion in annual tax revenue for the state, about 7.6 percent of the total tax revenue. Legal immigrants contribute about $18.4 billion in tax revenue.

The center said the purpose was to provide a “shock analysis” — an estimate to spell out in black-and-white terms what the effects of hardline deportation policies could be.

“This so-called shock analysis is difficult in that there is no magic wand that can be waved that says, ‘Okay, well 15 percent of the workforce is gone or 100 percent of the workforce is now legal,” said Marshall Fitz, the center’s director of immigration policy. “Both are going to take processes that take time, and the way this analysis works is it has to be a snapshot basis.”

The purpose of the study, Fitz added, is to say, “If that’s really your goal then look what your goal is, your goal would create this huge hole in the state economy.”

The center’s data comes in an election year in which immigration, legal and illegal, and its effect on the economy have been thrust into the spotlight as unemployment remains steady and illegal immigration in the country continues to decline.

It also comes on the heels of the Obama administration’s deferred action policy initiative that would allow certain immigrants in the country illegally to apply for legal work authorization and a two-year reprieve from deportation proceedings. The president said in June it was a “stopgap” measure until Congress passes comprehensive immigration reform, but some groups are expressing discontent at the number of work permits that could be granted as a result of the policy.

Targeting the issue of creating a larger workforce is NumbersUSA, which describes itself as a coalition of  “moderates, conservatives and liberals working for immigration numbers that serve America's finest goals.” In a news release Tuesday, it announced a media blitz during the national Republican and Democratic conventions. The goal is to highlight that 1.5 million bachelor's degree holders in the country 25 or younger, 54 percent of the overall total, were unemployed or underemployed in 2011.

“Both political parties have had a tin ear to the plight of America's kids — and their parents — who have gone to the effort and expense to gain a college education but encountered an economy unable to use them," NumbersUSA President Roy Beck said in a prepared statement. "The job picture is even worse for young Americans with only a high school degree. The last thing our graduates need right now is more job competition."

In the Center for American Progress’ study, however, author and UCLA professor Raúl Hinojosa-Ojeda posits that legalizing illegal immigrants would actually be a job creator and a boon to the state’s economy.

“Undocumented immigrant workers earn about 18 percent less in wages than legal workers. A program that required all undocumented immigrants to earn legal status would increase employment compensation and employment in the state by closing the wage gap between documented and undocumented workers,” he writes, estimating that wages in the state could increase by about $9.7 billion.

Legalization would also create about 193,000 jobs, Fitz said, because of increased spending that would result in a need to hire personnel to meet demand in industries like retail, construction and automotive.

“Should immigrants be advantaged over U.S. citizens or undocumented immigrants over legal permanent residents? Absolutely not, but it begs the question: What do you do to make the economy better for everybody, and is it better for everybody to try to remove these people?” he said. “Or is it better to try and put them on legal footing where their wages go up?” 

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