The economic threat nobody is talking about: Chicago is losing immigrants - Metropolitan Planning Council

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The economic threat nobody is talking about: Chicago is losing immigrants

Despite Chicago’s Sanctuary City status, we’ve lost thousands of immigrants over the past decade. It’s a threat to our communities and economy that we can't afford to ignore

Flickr user Elise Kay Camp

"A Day Without Immigrants", image taken in Chicago in February 2017

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Imagine if Pilsen's residents disappeared within a decade. That sobering idea isn't far-fetched, according to new data analysis from the Metropolitan Planning Council revealing that the number of immigrants who have disappeared from Chicago over the past ten years roughly equals the population of Chicago's Lower West Side, which includes Pilsen and Heart of Chicago.

This comes on the heels of mid-April reporting that Cook County lost more residents than any other county in the nation between 2017 and 2018, a trend which included a decrease in international migration. But not only are fewer people immigrating to Cook County, the City of Chicago is actually losing immigrants.

As a city built on domestic and international migration, known even today for our vibrant ethnic enclaves, a decrease in immigration not only threatens our city's economy, but the very foundation of our identity.

Here's what the numbers show: 

Chicago lost nearly 31,000 immigrants over ten years

Immigration increased nationally over the past decade, but not in Chicago, despite Chicago’s sanctuary policies. While immigrants[1] added nearly 5.8 million people to the total U.S. population between 2007 and 2017, Chicago lost 30,962 immigrants during the same time period (see graphs below). The City of Chicago is home to 563,879 immigrants – documented and undocumented. Our analysis of data from 2007 to 2017 reveals that in 2017, the number of immigrants living in Chicago was lower than at any time during the past 10 years.

Historically, Chicago has depended on immigrants to offset the slow growth of its population. But this subtle, consistent, underreported decline in immigrants’ numbers demands immediate attention: With fewer immigrants living in, working in, spending money in and strengthening our communities, it is essential to prod the driving forces behind these population declines.

What is driving this loss? To answer this question, we first examined the overall trends in immigrant population and who these immigrants are, demographically.

Latinx residents comprise largest portion of Chicago’s immigrant population decline

 In terms of race, Latinx residents comprise the largest portion of Chicago’s immigrant population decline, and also comprise the largest share of the immigrant population overall, at 52 percent. In contrast, Asian immigrants’ numbers have increased year after year (see graph below), almost surpassing White immigrants – the second largest racial group by share.

Historically, individuals from Mexico have been the largest group of immigrants coming to Chicago. But current trends indicate a shift in the main country of origin, as immigrants from Asia are rising in share. The decline in the Chicago immigrant population is particularly strong among non-U.S. citizens[2], who make up the majority of immigrants in Chicago (56.21 percent). Nearly half of all Chicago immigrants were naturalized citizens in 2017 (43.79 percent), a trend that seems to be on the rise.

Chicago is losing less-educated immigrants

 Our data analysis also revealed that Chicago’s immigrant population is achieving higher levels of educational attainment. More than 1 in 4 immigrants 25-years-old and older (26.56 percent) held a bachelor’s degree or higher in 2017, up from 23.29 percent in 2013. While less-educated immigrants make up the majority of the foreign-born population, their numbers are declining. From 2013 to 2017, the population of Chicago immigrants that had less than a high school education—the lowest educational attainment level recorded in the data—decreased by 4.22 percentage points.

The city’s decline of less-educated immigrants could be explained in part by changes in the industrial sectors that support the economy of the region, from a decline in manufacturing and other occupations largely occupied by immigrants, to an increase in jobs that require higher levels of education.

 The decline in immigrant population also suggests that Chicago is aging and experiencing a drop in fertility rates: The population of immigrants 45 years-old and over is growing while the population under 44 years-old is decreasing. These numbers suggest that the city’s immigrant population could be driving the growth in the Chicago senior population. There are also fewer immigrant women aged 15 to 50 having children. While immigrants tend to arrive younger and have higher fertility rates compared to natives, these trends represent a significant departure from what historically was the norm (see tables below).

Immigrants are essential to the city’s prosperity and growth

 As Chicago’s population slows down, immigrants are becoming increasingly necessary to sustain and advance the city’s economic growth and development. Immigrants—currently about 25% of the employed labor force in 2017, according to the U.S Census Bureau—fill important labor gaps left by an aging population and a decline in fertility rates. As Baby Boomers retire, immigration will supply the workers necessary to offset a shrinking workforce.

 Immigrants also help drive the economy forward by boosting the demand for local goods and services with their spending power. According to the Institute on Taxation and Economic Policy, undocumented immigrants contribute significantly to state and local taxes, including sales, excise, property, and income taxes. In Illinois, undocumented immigrants pay an estimated $750 million a year or an average effective tax rate of 10.3%, while the top 1% of tax payers in Illinois pay an average effective tax rate of just 4.6%.

 Further, immigrant diversity generates significant advantages. They are a force of innovation and entrepreneurship and give Chicago its competitive edge. In 2016, immigrants represented 36.4% of Chicago’s entrepreneurs and generated $659 million in business income for the city.

 Further research is needed to understand why Chicago’s immigrant population is declining, but in any case, MPC believes the loss is an economic threat that should not be ignored. If Chicago’s immigrant population loss continues, many communities in Chicago will have difficulties attracting and retaining businesses and local tax dollars. Paying close attention to these numbers is even more important now that the Trump administration is doubling down its efforts to curtail immigration. Trump’s recent threat to close the southern U.S. border should alarm policymakers, and drive attention to the potential negative consequences that might be hiding in plain sight.

[1]For the purpose of this post, the term ‘immigrants’ refers to anyone who is not a U.S citizen at birth, including those who become U.S citizens through naturalization.

[2]Non-U.S. Citizens include lawful permanent residents, temporary migrants (such as persons with student or work visas), humanitarian migrants (such as refugees and asylees), and unauthorized migrants.

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