American Renaissance

Immigration and Income Inequality

Federation for American Immigration Reform

Executive Summary

The 2000 Census data shows that during the previous decade the share of middle-income U.S. households fell to below one-third of all households. The less than 30 percent of households that were in the $35,000 — $67,000 income range was a decline from about 34 percent of households in the comparable $25,000 — $50,000 range in 1990.

An important factor influencing the decline of the share of middle-income families is legal immigration. The flow of new immigrants adds both to upper-income families and to low-income families, while new illegal immigration adds generally to low-income families. At the same time, middle-income families are dwindling.

Studying the distribution of income and immigrant settlement can demonstrate this impact of immigration. The results show a pattern of smaller shares of middle-income families in locations with larger immigrant populations and larger middle-income shares in areas with lower immigrant populations. This may be seen in analyzing immigration and income data for the states, and to an even greater extent in analyzing data for metropolitan areas.

Equally important in showing the effects of immigration on the nation’s income distribution, is studying the pattern of change between 1990 and 2000. This focus shows that the states that added the most immigrants to their population over that period also had the greatest losses in the middle-income share of their population while share of middle-income households was less affected in states that added fewer immigrants.

If legal immigration is not substantially reduced and illegal immigration curtailed, this nation is will continue to see a precipitous and continual decline in its middle class — arguably the cornerstone of American democracy.

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