Donald Trump isn’t the best politician the United States has ever got. It may be owing to his extreme policies or the approach he is a follower of which doesn’t fascinate everyone. Another Trump’s policy which caught the eyes of the economists and researchers was his authorities preparing to crack down on illegal immigration, with a particular focus on deportation of the nation’s estimated 11 million undocumented immigrants. It may seem like a good idea to furnish the citizens of the U.S. with better opportunities but it is posing serious repercussions on the economy.
A working paperpublished by the National Bureau of Economic Research founded that the undocumented immigrants were expected to contribute approximately $5 trillion to the U.S. economy over the next 10 years, roughly 3 percent of the gross domestic product. Alicia Sasser Modestino an associate professor and a labour market expert in the College of Social Sciences and Humanities at Northeastern University elucidated how the implementation of Trump’s deportation plan might impact the nation’s economy. When asked about how the jobs filled in by the immigrants be replaced, Alicia feels that it may be difficult in the short run. Wage rates may rise to attract naïve labourers. Jobs in agriculture, construction, and janitorial services where employers paid illegal immigrants below-market wages would be worst hit by the mass deportation.
However, in the long run, there won’t be any need to fill in the shoes of these deportees as the new production processes would bring in more flexibility in capital driven production and less in labour driven production. Alicia also busted the myth that this deportation would fuel the United States’ economy as the native businessmen are on the losing side this time. These businessmen earlier enjoyed the benefits of cheap labour and hence were the owner of greater surplus; loss of some portion of that surplus can lead to slower economic growth.
Harminder Singh