Building America’s Talent Pipeline: Aligning Workforce and Immigration Strategy

Workforce and immigration policy, in many ways, make up two halves of one whole—and amid the set of administrative actions this year, there are signs that some officials recognize this connection.  

Last summer, the administration launched the Office of Immigration Policy (OIP) within the U.S. Department of Labor (DOL) to streamline employment-based immigration. “The establishment of the OIP suggests a more coordinated federal effort to make employment-based immigration smoother, more transparent, and better aligned with labor market realities,” noted one of several immigration law firms speculating on the office’s potential impact.  

And just a few weeks ago, in an interim rule on agricultural labor from the DOL, we saw an acknowledgment that immigrants’ absence from the workforce—and the slim likelihood that the resulting gap could be filled by workers born in the United States—will cause harm. “[Q]ualified and eligible U.S. workers will not make themselves available in sufficient numbers, even at current wage levels, to fill the significant labor shortage,” the ruling said. The result, it continued, will be “disruption to food production, higher prices, and reduced access for U.S. consumers, particularly to fresh fruit and vegetables.” 

More recently, researchers at the Federal Reserve Bank of San Francisco pointed out that fewer immigrants entering the country, combined with slower growth in the working-age population, could significantly dampen the economy today and long into the future. And in Denver, Colorado, economic growth forecasts are being revised downwards because of a 17 percent decrease in international migration.  

Most economists agree that immigrants are crucial to a vibrant economy. Consider the following: 

• The size of the U.S.-born working-age population has decreased every year since 2020.  
• As baby boomers retire, the worker-to-retiree ratio will drop from 3-to-1 today to just 2-to-1 in the next few decades.  
• From now through 2034, the U.S. Bureau of Labor Statistics projects 1.9 million job openings annually in health care due to sector growth and retirements. 
• The senior-to-working-age ratio jumped from 20 per 100 in 2000 to 29 in 2023, heading toward 37 by 2040. Maintaining today’s ratio would require accepting 3.5 times as many immigrants annually as we do now. 
• U.S. birth rates have fallen below replacement level, resulting in fewer future workers to support economic growth. 
• One hundred (100) percent of U.S. workforce growth in the past two decades is due to immigration.  

These demographic pressures translate into acute labor shortages across critical sectors. The centrist Baker Institute for Public Policy at Rice University estimates that current immigration policies will worsen these shortages significantly: 1.5 million workers lost in construction, 1 million in hospitality, 870,000 in manufacturing, 461,000 in transportation and warehousing, and 225,000 in agriculture. The economic consequences are substantial. The institute projects that shrinking the immigrant workforce could drive national GDP down by more than 6 percent over the next decade, while raising consumer prices more than 9 percent within three years.  

In August, the administration released America’s Talent Strategy: Building the Workforce for the Golden Age. The document states that “America’s workforce is aging, with millions of experienced workers retiring and fewer younger workers entering the [talent] pipeline to replace them.” It specifies talent shortages in manufacturing (500,000 open jobs expected to quadruple in coming years), health care, semiconductors, aerospace, shipbuilding, and energy production. The strategy, however, ignores immigration policy, solely focusing on retraining and upskilling U.S.-born workers. And while retraining and upskilling are necessary and important parts of any plan to strengthen our economy and workforce, demographic facts—for instance, the declining number of U.S.-born workers—tell us that this cannot be the only approach. We need to add to our workforce in meaningful ways to sustain economic growth.  

It’s uncertain whether we will ultimately see stronger alignment between immigration and workforce policies. What is certain is that doing so will create a more resilient economy. The opportunities to take action are abundant. These include: 

• A responsive immigration system. DOL could work to ensure that our immigration system is more aligned with our labor and population needs. This should include smoother and more accessible employment, education, humanitarian, and permanent resident pathways for those living in the U.S. and those who are yet to come.  

• Forward-focused workforce and immigration policy connections. A role within federal government to match future workforce needs with immigration policies would ensure that our economic ambitions translate into reality. What does this look like in practice? When the U.S. Department of Commerce identifies semiconductor workforce gaps, it identifies the skills it needs and begins work to ensure that internationally trained engineers and other skilled workers can contribute, including by streamlining credential recognition and pathways to employment. When the U.S. Department of War flags shipbuilding talent shortages, a responsive immigration system ensures that skilled workers are part of the solution from Day One.  

• Expanding talent strategies to fill key gaps. Immigrants represent 30 percent of construction workers and fill critical roles in advanced manufacturing. By providing resources, training, and access to work authorization, the administration could bridge essential talent gaps that U.S. workers alone cannot fill—and support the goals outlined in America’s Talent Strategy. 

• Improving credential and skills recognition. As the U.S.-born workforce ages and millions of experienced workers retire, recognition of international credentials and skills becomes essential. Many states are already reforming policies to realize the full talent of immigrant residents in their economy. The federal government could play a central role in expanding and encouraging these efforts nationally—and linking them, where possible, with immigration policy to streamline one’s ability to enter the workforce where most needed.  

America’s future—like its past and present—is one in which immigrants work and live alongside their U.S.-born neighbors. This vision is not political, it’s an economic imperative. The OIP’s potential to align market realities with immigration policy, the DOL’s recognition of workforce gaps, and state-level efforts are all signs that officials know that good workforce policy needs good immigration policy. What remains is developing the will and the mechanisms to connect them. Only when workforce and immigration policies work in tandem can we build the talent pipeline America’s economy demands.

Kit Taintor