Fed’s Barken warns that:
- US workforce growth is basically 0 without immigration.
When workforce growth is zero, the economy loses a key drivers of expansion, leaving GDP growth almost entirely dependent on productivity gains.
In this situation, overall output can still increase, but only if workers and businesses become more efficient through innovation, technology, or improved processes. That is the bet. That may happen if the change in the unit of output is greater than the unit cost of that output.
Without productivity growth, GDP tends to stagnate because there are no additional workers to produce more goods and services.
Over time, zero workforce growth can also increase fiscal pressures, as a stable or shrinking pool of workers must support a growing share of retirees and dependents.
While some wage gains may occur due to tighter labor supply, the broader economy generally experiences slower and more fragile growth, making sustained productivity improvements essential for maintaining momentum.
What about inflation? Shortages?
Immigrants fill a wide range of jobs across the U.S. economy, often in roles that are difficult to staff with domestic labor alone. Their contributions span both high-skill and essential, labor-intensive sectors, meaning that without them, certain industries face significant worker shortages and economic strain, that may require stealing workers from other industries by paying more. Of course, there may not be people who are willing to do the jobs
