November 28, 2012
May 2013 - About 40 million foreign-born people now live in the United States, accounting for about 13 percent of the total population.
A Description of the Immigrant Population: An Update
June 2, 2011
This document is the latest in CBO's series on immigration. It updates A Description of the Immigrant Population (November 2004), providing an overview of the nation's foreign-born population, with a particular focus on the years 2000 to 2009. It discusses changes in the numbers and countries of origin foreign-born people and their U.S. residency and citizenship status, and it compares demographic and labor market characteristics of foreign-born and native-born people in the United States.
Migrants' Remittances and Related Economic Flows
February 24, 2011
Migrants' remittances—payments sent by foreign-born workers back to their home country—have become a significant source of monetary inflows for many countries. In 2009, such remittances from the United States to other countries totaled more than $48 billion, nearly 30 percent more in inflation-adjusted terms than they were in 2000. People in Mexico receive more of the remittances sent from the United States than do residents of any other country.
This document updates and expands upon the Congressional Budget Office's (CBO's) May 2005 publication Remittances: International Payments by Migrants. That paper included data through 2003; this document includes data through 2009. The existing data on global remittances are not of very high quality, however, and the comparisons and trends reported here should be viewed only as approximations.
Migrants to the United States often send money to people in their home country or take it with them when they return home. Those transfers can involve sending money through banks or other institutions to family members or others in the home country, making financial investments in the home country, or returning to the home country while retaining bank accounts or claims on other financial assets in the United States. All three types of actions are similar in their economic effects, even though only transfers of money through banks and other financial institutions to foreign individuals are commonly thought of as migrants' remittances.
As one of the most important destinations of global migration, the United States is the largest national source of remittances. The opportunity to send or bring remittances home is one of the important motivations for migration, and policies that affect migration to the United States could affect outflows of remittances. In turn, the flow of remittances can affect economic growth, labor markets, poverty rates, and future migration rates in the United States as well as in recipient countries.
This document updates and expands upon the Congressional Budget Office's previous analysis of remittances—Remittances: International Payments by Migrants (May 2005)—and presents data through 2009. The new presentation provides a better view of people's total transfers of money between the United States and other countries but, because of changes in the way the data are collected and reported, does not provide as much information as was previously available on the portion of those transfers that is attributable to migrants. (See "Notes and Definitions" at the beginning of the full document for a summary of terminology and the appendix for a discussion of recent changes in the classification of remittances.) The existing data on global remittances and related economic flows are not of very high quality, and the comparisons and trends reported here should be viewed only as approximations.
Remittances from the United States (Exhibits 1 to 4)
The Bureau of Economic Analysis (BEA) estimates that migrants' remittances totaled about $48 billion in 2009—nearly 70 percent more than official development assistance provided by the U.S. government. Nearly $38 billion of that amount was personal transfers by foreign-born residents in the United States to households abroad. The rest, about $11 billion, reflected the compensation of employees who were in the United States for less than a year; some of that compensation, however, was spent in the United States. No breakdown of the regional destination of the money sent home is available for 2009, but in 2003, by BEA's estimate, about two-thirds of personal transfers went to countries in the Western Hemisphere, one-quarter went to countries in Asia and the Pacific, and the rest went to countries in Europe and Africa. BEA also reports that, in 2009, migrants' capital transfers (that is, individuals' transfers for themselves, as opposed to transfers to others) amounted to nearly $3 billion on net.
BEA estimates outflows of personal transfers on the basis of four characteristics: the size of the foreign-born population (differentiated by duration of stay in the United States, family type, country of origin, and sex), the percentage of the foreign-born population that remits, the income of the foreign-born population, and the percentage of income that the foreign-born population remits.
No information is publicly available on flows of migrants' remittances from the United States to specific regions or countries. Such details are available only for a category that BEA calls "net private remittances and other transfers," which measures outflows minus inflows (rather than outflows only) and includes institutional remittances by U.S. nonprofit organizations as well as a variety of other minor transactions. For 2009, BEA reports net private remittances and other transfers of $74 billion and net compensation of nonresident employees of nearly $8 billion, for a total of $82 billion in net outflows. That figure represented about 0.6 percent of total U.S. gross domestic product (GDP) in 2009. About 40 percent, or $33 billion, went to other countries in the Western Hemisphere. Another $17 billion was sent to countries in Asia and the Pacific, $9 billion flowed to countries in Europe, and $5 billion was transferred to countries in Africa.
Effects in Recipient Countries (Exhibits 5 and 6)
Remittances can have both positive and negative effects on the economies of recipient countries. The transfers provide a country's economy with foreign currency, help finance imports, improve the balance of payments in its international accounts, and increase national income. However, the migration that generates remittances also reduces the labor force of the country of origin, and remittances may reduce the remaining family members' incentive to work. The available evidence suggests that recipients with income below a threshold level tend to use remittances primarily for consumption, including, for instance, purchases of food, consumer goods, and health care. In surveys of people in the United States who remitted money to Mexico, for example, 70 percent reported that consumption was the only purpose, 3 percent reported that asset accumulation was the only purpose, and 26 percent said that both consumption and asset accumulation were reasons for remitting. Nevertheless, evidence from some developing countries suggests that households in those countries tend to save a larger portion of income from remittances than from other sources of income, providing a source of capital for investment.
Concurrent with the overall increase in global remittances has been a decline in the fees charged by financial institutions to make those transfers. Between 2001 and 2009, the fees charged to transfer $200 to six countries in Latin America declined by an average of at least 3 percent per year (for Haiti) to 10 percent per year (for Colombia), possibly because of lower transaction costs resulting from technological progress and more awareness among migrants about alternative ways to remit.
Remittances to Mexico (Exhibits 7 to 9)
Mexico is the destination of the largest amount of remittances from the United States. According to BEA's estimates, of the $33 billion (net) transferred from the United States to people in other countries in the Western Hemisphere in 2009 or earned as compensation by short-term migrants, about $20 billion was identified in the international economic accounts as going to Mexico; by BEA's estimates, such flows from the United States to Mexico (adjusted for inflation) rose by an average of 2 percent per year between 2000 and 2009. The Banco de Mxico estimates that all gross inflows of funds from abroad—not only from the United States—were about $22 billion in 2009. (The bank does not estimate outflows.) Estimates from the Banco de Mxico indicate that all gross inflows (adjusted for inflation) rose by an average of 11 percent per year during the past decade.
The difference between BEA's and the Banco de Mxico's estimates could stem not only from differences in definitions but also from differences in methodology and source data. Beginning in 2003, all Mexican banks and money transfer companies were required to register with the Banco de Mxico and to report monthly remittances by state. (Prior to that rule change, the Banco de Mxico inferred remittances from a 1990 census of different Mexican financial institutions.) In addition, around that time, the "matricula consular"—an identification card issued by the Mexican government to Mexican nationals living outside of the country—began to be accepted for opening bank accounts in the United States; that change may have helped facilitate money transfers to Mexico in a way that allowed the Banco de Mxico to better record them. Finally, the Banco de Mxico also conducts a border survey that asks returning migrants about cash and goods that they are bringing to relatives in Mexico. With the apparent increased use of more formal channels to transfer money between the United States and Mexico and those border surveys, the official Mexican statistics are recording cash transfers not captured in the past.
Global Flows of Remittances (Exhibits 10 to 13)
According to the International Monetary Fund, total inflows of remittances globallythe sum of personal transfers, compensation of employees, and migrants' capital transferswere about $407 billion in 2008 (in nominal dollars), up from about $150 billion in 2002, an average increase of 18 percent per year. About two-thirds of global inflows was sent as personal transfers, about 30 percent was recorded as compensation of employees, and about 5 percent stemmed from migrants' capital transfers. Although total inflows and outflows of global remittances should be equal, total recorded outflows—about $289 billion in 2008—are generally much lower than total recorded inflows. The discrepancy between total inflows and total outflows underscores the deficiencies of remittance data, which are collected or estimated in different ways in different countries. Even when remittance data are collected directly, discrepancies arise because of the use of informal channels for transfers of funds as well as the misclassification of remittances as tourism receipts, trade receivables, or deposits.
Total inflows of remittances constitute a small fraction of global economic activity, amounting to about 1 percent of total gross domestic product in 2008. For a number of countries, however, such funds constitute a substantial source of income: For at least six countries in Latin America and the Caribbean, total inflows amounted to more than 10 percent of GDP. Further, for a number of countries, total inflows were more than double total foreign direct investment in 2008.
Immigration Policy in the United States: An Update
December 3, 2010
This document updates the Congressional Budget Office's February 2006 paper Immigration Policy in the United States. It presents data through 2009 on permanent and temporary admissions of foreign nationals to the United States, the number and types of visas issued, the naturalization of residents, and enforcement of immigration laws—and makes comparisons with 2004, which was the most recent year for which most data were reported in the earlier paper.
The Immigration and Nationality Act sets immigration policy in the United States on the basis of four general objectives:
- To facilitate the reunification of families by admitting people who already have a family member living in the United States,
- To attract workers to fill positions in certain occupations for which there are shortages,
- To increase diversity by admitting people from countries with historically low rates of immigration to the United States, and
- To provide a refuge for people who face the risk of racial, religious, or political persecution in their home country.
The law allows foreign nationals to enter the United States to become legal permanent residents (LPRs) or to be in the United States for a specific purpose during a limited stay as temporary residents or visitors. To enter the country as a legal permanent resident, a national of a foreign country must obtain a visa. To enter the country as a temporary resident or visitor, a foreign national must obtain a visa, be a qualifying citizen of Canada or Mexico, or be a qualifying citizen of a country that participates in the Visa Waiver Program. (That program allows citizens of certain countries to travel to the United States for business or tourism for up to 90 days without having to obtain a visa.)
The law also outlines a process by which foreign nationals who have been granted legal permanent residence may apply to become naturalized U.S. citizens. In addition, the law establishes mechanisms to control the flow of legal entry into the United States, prevent the entry of individuals without authorization, and remove individuals who are in the United States without authorization.
Legal Permanent Residents
People granted permanent admission to the United States are formally classified as legal permanent residents and receive a document, commonly known as a green card, that certifies that status. LPRs are eligible to live and work in the United States, own property, and join the armed forces; eventually, they may apply for U.S. citizenship. In 2009, the United States granted LPR status to roughly 1.1 million people.
Foreign nationals who are eligible for permanent admission fall into one of five broad categories. Two of those categories--immediate relatives of U.S. citizens and family-sponsored preferences--are based on family relationships. Under a third category, employment-based preferences, workers with specific job skills are eligible for permanent admission. The fourth category is known as the Diversity Program, which allows individuals from countries with low rates of immigration to the United States to enter under a lottery-based system that provides a pathway for legal permanent residency. Finally, for humanitarian reasons, some foreign nationals are admitted to the United States as refugees or asylum-seekers; one year after obtaining asylum or refugee status, they may apply for LPR status.
People granted permanent admission include foreign nationals who entered the United States as legal permanent residents and those already present in the country who were granted LPR status. Of the people granted LPR status in 2009, about 463,000 (or 41 percent) were first-time entrants to the United States, and about 668,000 (or 59 percent) were already inside the United States. In 2009, foreign nationals who were born in Asia accounted for 413,000 (or 37 percent) of the people granted LPR status, and people who were born in North America (which includes Central America) accounted for 375,000 (or 33 percent).
The total number of permanent admissions in 2009 was about the average for the previous four years but 18 percent more than were granted such status in 2004. (Over the period from 2005 through 2009, the number of people granted LPR status averaged about 23 percent more than the number during the 20002004 period.) The number of immediate relatives of U.S. citizens who were granted LPR status increased by 28 percent from 2004 to 2009, accounting for nearly half of total permanent admissions in 2009. In contrast, the number of people admitted in the familysponsored preference category remained roughly constant from 2004 to 2009 and accounted for 19 percent of admissions in 2009. The number of individuals admitted on the basis of employment preferences decreased slightly between 2004 and 2009 and accounted for 13 percent of admissions in 2009. Admissions under the Diversity Program accounted for only 4 percent of the 2009 total and declined slightly from 2004 to 2009. The number of people admitted for humanitarian reasons, which constituted 17 percent of the permanent admissions in 2009, grew by almost 60 percent from its level five years earlier.
Temporary Residents and Visitors
Temporary admission to the United States is granted to foreign nationals who seek entry for a limited time and for a specific purpose, such as tourism, diplomacy, or study. In addition, foreign nationals who meet certain criteria may be permitted to work in the United States for a limited time that depends on the type of visa they receive. However, foreign nationals with temporary visas are not eligible for citizenship, and to remain in the United States on a permanent basis they would be required to apply for permanent admission.
The federal government reports two types of data on foreign nationals who enter the United States as temporary residents or visitorsthe number of temporary visas issued and the number of temporary admissions. The number of visas issued indicates the potential number of foreign nationals who may seek admission to the United States (excluding a large number who do not require a visa). The number of temporary admissions indicates the number of times that foreign nationals enter the United States, thus counting frequent travelers multiple times.
About 5.8 million visas for temporary admission to the United States were issued in 2009. Twenty-four percent were for temporary residents and 76 percent were for visitors. Although the number of visas issued in 2009 was 755,000 (or 15 percent) higher than the number in 2004, it was down by almost 800,000 (or 12 percent) from the 6.6 million visas issued in 2008. The decrease was most likely a result of the global recession: Fewer visas were issued for business, for tourism, and for employment.
The number of legal temporary admissions was much greater than the number of visas issued. The Department of Homeland Security (DHS) estimates that there were 163 million legal temporary admissions to the United States in 2009. That estimate includes 126 million admissions not requiring visas by Canadians traveling for business or tourism and certain Mexicans with Border Crossing Cards. It also includes about 36 million admissions of foreign nationals who were required to complete an Arrival/Departure Record (known as an I-94 form); about 16 million of those admissions were individuals who entered under the Visa Waiver Program, and the rest had visas. Many individuals had multiple admissions because they departed and reentered the United States during the same year.
The number of legal temporary admissions in 2009 was the lowest since DHS began reporting those data in 2003 and was about 10 percent less than the number admitted in 2004. The numbers presented throughout this document represent the flow of foreign nationals into the United States in accordance with U.S. immigration law. Information on the departures of temporary residents and visitors after their authorized stay is currently not recorded. Official estimates are available only on departures of LPRs.
Legal permanent residents may become citizens of the United States through a process known as naturalization. To become a naturalized citizen, an applicant must fulfill certain requirements set forth in the Immigration and Nationality Act. In general, any legal permanent resident who is at least 18 years old and who has maintained the specified period of continuous residence and presence in the United States can apply for naturalization. In 2009, about 744,000 people became naturalized U.S. citizens, well below the number naturalized in 2008 but close to the average for the past five years. Of the 2009 total, the largest percentages of people were born in Mexico (15 percent) and India (7 percent).
Enforcement of Immigration Policy
In addition to regulating the legal admission of permanent residents and temporary residents and visitors, U.S. law specifies policies for individuals in the United States without legal authorization. People found to be in the United States in violation of immigration law may be allowed to depart voluntarily or may be removed from the country through a formal process of adjudication, which can include the imposition of penalties (such as fines), a prohibition against future entry, or both.
In addition, individuals convicted of certain crimes can be imprisoned before they are removed from the United States.
The Department of Homeland Security is responsible for enforcing immigration law and acts to arrest, detain, return, and remove foreign nationals who violate U.S. laws. In 2009, about 580,000 people who were arrested or detained returned voluntarily under the supervision of a DHS official to their home country or to another country, a figure that is well below the number in recent years. Also in 2009, about 393,000 people were ordered removed, which is 63 percent more than were ordered removed in 2004. Of those 393,000 removals, 107,000 were carried out using an expedited process designed to speed up the removal of people attempting to enter the country illegally. In 2009, about two-thirds of total removals were for noncriminal violations, such as a lack of proper documentation, and the other one-third were for criminal violations of U.S. laws. (Although various estimates exist, there is no way to count the total number of individuals who enter the country illegally or how many of them leave voluntarily.)