Washington, DC (January 29, 2023) – In response to recent claims that the surge in legal and illegal immigration has significantly contributed to reducing inflation by lowering wages, Dr. Steven Camarota, Director of Research at the Center for Immigration Studies, presents a detailed analysis disputing this argument. The modest increase in the labor supply provided by immigration, combined with the prevalence of low-paying occupations among immigrants, suggests that the overall impact on consumer prices is minimal.

Camarota’s examination of occupational data suggests that the impact of immigration on wages is skewed toward lower-paying jobs, with the “farming, fishing, and forestry” category seeing the most significant increase in workers. However, this sector represents only 0.29 percent of all wages in the country, indicating a limited impact on overall wages.

“Some have called for more immigration to lower wages and prices in the last two years. Ironically, this is a complete reversal of their position before inflation spiked, which was that immigration had little or no impact on wages,” said Camarota. “Interestingly, none of the recent news stories have quantified the impact on prices. The reason may be that, mathematically, the effect of recent immigration on prices must be very small.”

The analysis by those advocating more immigration assumes that all the savings in wages are passed on to consumers rather than retained by employers in the form of higher profits. However, this estimate makes no allowance for the increase in demand for goods in services that would occur from adding millions of immigrants to the country, which itself is inflationary.