A new study shows that refugees pay more in taxes than they receive in welfare benefits over a 20-year span
Refugees have been at the center of a political maelstrom, accused of everything from terrorism to being a drain on taxpayers — prompting President Trump, in one of his first official acts, to suspend the country’s four-decade old refugee resettlement program.
But a new study shows that refugees end up paying more in taxes than they receive in welfare benefits after just eight years of living in this country.
By the time refugees who entered the U.S. as adults have been here for 20 years, they will have paid, on average, $21,000 more in taxes to all levels of government than they received in benefits over that time span, according to a working paper released Monday by the National Bureau of Economic Research that examined the economic and social outcomes of refugees in the U.S.
“There was a lot of rhetoric saying these people cost too much, but we didn’t actually know what that number was,” said William N. Evans, an economist at the University of Notre Dame who co-authored the paper.
Trump, in his January executive order temporarily barring refugees from entering the country, had directed the State Department to study the long-term costs of the refugee admissions program to federal, state and local governments.
Evans and his colleague Daniel Fitzgerald responded, estimating that it costs the U.S. an average of $15,000 to resettle each refugee, including the cost of background checks, housing, English lessons and job training.
In addition, refugees, unlike other immigrants, are eligible for welfare cash assistance, food stamps and Medicaid. Those social safety net costs amount to roughly $92,000 in benefits over a refugee’s first 20 years in the U.S. — while the refugee pays a total of $129,000 in taxes over the same time period, researchers found.
Since the refugee admissions program started in 1975, the U.S. has resettled more than 3 million refugees. Researchers examined data pertaining to refugees from two dozen countries in Africa, Asia, Eastern Europe and the Middle East.
Despite arriving in this country with significant language and educational deficits, refugees experience a rapid increase in employment rates and earnings over time, the study shows.
That’s not to say refugees don’t struggle in the beginning — and begin their stay in the U.S. relying on a lot of public assistance. Their outcomes are in part determined by whether they arrived in the U.S. as children, as teenagers or as adults.
Those who arrive before the age of 14 graduate from high school and enter college at the same rate as their U.S.-born counterparts, researchers found — a finding that Evans characterized as the most surprising to him.
“The conditions they experienced in the early part of their lives are pretty devastating,” he said. “A lot of research has suggested that early life conditions make a huge difference in later life outcomes, but despite the poorer situations these children had early on, they seem to be doing pretty well.”
But those who enter the country in their later teen years have substantially lower educational attainment. Researchers attribute the poorer outcomes to language barriers and the fact that many arrive unaccompanied by parents and end up in foster care.
Only 5 to 10 percent of children under the age of 14 arrive in the U.S. without a mother. That figure increases to 20 to 30 percent for those arriving at ages 15 or 16. And more than 40 percent of refugees entering at age 17 come without their mothers.
Given the disparities in outcome between those arriving as children and those coming as teenagers, the researchers suggested that any future increased spending on refugees would be best targeted to older teen arrivals.
Refugees who arrive between the ages of 18 and 45, meanwhile, start out in the country with low employment and earnings and rely heavily on welfare programs. But after six years in the U.S., they work at higher rates than their U.S.-born counterparts — though their wages never catch up. After 10 years, their use of welfare and food stamps are comparable to native-born Americans.
The longer refugees live in this country, the better their economic outcomes.
Tracy Jan, June 13, 2017
Tracy Jan covers the intersection of race and the economy for The Post. She previously was a national political reporter at The Boston Globe