Quantifying the Recent Immigration Surge: Evidence from Work-permit Applications 
Although nonfarm payroll growth has slowed recently, it has been relatively strong over the past two years, averaging 214,000 workers per month from December 2022 through October 2024. Nevertheless, over that period the unemployment rate rose slightly, from 3.5 percent to 4.1 percent. A potential answer to the question of why unemployment rose amid rapid hiring is that immigration has significantly increased population growth and thus has raised the number of available workers. A boost in monthly trend labor-supply growth of approximately 100,000 workers due to immigration would be consistent with a modest increase in the unemployment rate. Evidence of a surge in immigration has come from the Congressional Budget Office (CBO), which used data from the Department of Homeland Security and other sources to estimate net immigration of 3.3 million people in 2023 and the same number in 2024. These estimates are much larger than recent immigration estimates from the US Census Bureau and the Social Security Administration. This paper uses data directly related to the labor market—immigrant applications for federal work permits—to further study immigration’s effect on US employment.
Key Findings
- Relative to previous migration waves, recent migrants are more likely to be eligible for work permits, because a significant fraction of them are coming from countries experiencing political or social turmoil. For example, migrants who claim asylum in the United States are typically allowed to work legally while their cases are pending before immigration courts.
- In fiscal year 2023, more than 800,000 asylum-seekers applied for work permits. Including other categories of work-permit applicants, such as persons paroled into the country for humanitarian reasons, brings the total number of applications related to recent immigration developments to just under 1.5 million—about 1 million higher than in fiscal years 2021 and 2022.
- Detailed data on applications by category are not yet available for fiscal year 2024. But the available data suggest that in that fiscal year, the number of applications related to recent immigration developments—such as those from asylum-seekers and people awarded humanitarian parole—exceeded the pre-surge trend in applications by about 1.8 million.
- An additional 1.0 million workers in fiscal year 2023 and 1.8 million in fiscal year 2024 suggests that monthly additions to the labor force were about 80,000 and 150,000 workers, respectively, in those two years. These additions are close to, but somewhat higher than, previous estimates of labor market effects of recent immigration calculated by other analysts.
Implications
Although this paper’s estimates do not map precisely into the trend-growth effects implied in previous analyses, they are consistent with the CBO’s findings of very large increases in immigration and help explain why unemployment rose even though recent employment growth was strong.
Abstract
The US unemployment rate has drifted higher since early 2023, even though growth in payroll employment has been strong over this period. Some commentators have noted that the puzzle of rising unemployment amid rapid hiring can be explained by a large increase in immigration, which would raise population growth and allow firms to hire large numbers of new (immigrant) workers without dipping into the unemployment pool. This paper uses a source of administrative data that is directly related to the labor market—immigrant applications for work permits—to estimate the immigrant labor inflow in 2023 and 2024. The surge in new work-permit applications in these two years supports the large immigration estimates based on other administrative data from the Department of Homeland Security, including the significant immigration increase recently estimated by the Congressional Budget Office.