Money Sent Home by Migrant Workers Helps American Economy Too
February 10, 2010
Washington D.C. - Today, the Immigration Policy Center (IPC) released a report, Many Happy Returns: Remittances and Their Impact by Kristin Johnson, Ph.D. which analyzes remittances and their effect on the economies of both the U.S. and receiving countries. Remittances - the transfer of money by workers back to home countries - can constitute one of the top financial inflows to many developing countries, in some cases exceeding international aid. Mexico and the Philippines are the top receiving countries from the U.S. and are also large consumers of U.S. goods. In addtion, in the wake of Haiti's overwhelming humanitarian crisis, remittances will assume a central role in providing critical resources to the population. Some critics argue that remittances are a loss to the U.S. economy, however, the latest IPC report shows that remittances are actually used to buy goods from U.S. companies, showing that remittances actually benefit both the sending and receiving countries.
From the report:
"Remittance outflows likely provide long term benefits to the U.S. economy. Remittances boost the consumption of U.S. exports, resulting in expansion of U.S. business and trade competitiveness. Ultimately, sending money abroad expands the consumer base able to purchase U.S. goods, a critical facet in maintaining a strong U.S. economy."
The IPC also released a Fact Check on the key role remittances will play in Haitian recovery efforts and how that will in turn help U.S. exports which notes:
"Over half of Haiti's imports originate in the U.S., and the states with the most Haitian immigrants also have large export markets in Haiti. In this way, the remittances that immigrants in the U.S send abroad have a positive impact on the U.S. economy and trade."
To read the report and fact check in their entirety see:
• Many Happy Returns: Remittances and Their Impact (IPC Special Report, February 10, 2010)
• Remittances Will be Critical to Haitians: The U.S. Benefits from Remittances As Well (IPC Fact Check, February 10, 2010)