Why The Red States Will Profit Most From More U.S. Immigration

In recent years, the debate over immigration has been portrayed in large part as a battle between immigrant-tolerant blue states and regions and their less welcoming red counterparts. Yet increasingly, it appears that red states in the interior and the south may actually have more to gain from liberalized immigration than many blue state bastions.

Indeed an analysis of foreign born population by demographer Wendell Cox reveals that the fastest growth in the numbers of newcomers are actually in cities (metropolitan areas) not usually seen as immigrant hubs. The fastest growth in population of foreign born residents–more than doubling over the decade was #1 Nashville, a place more traditionally linked to country music than ethnic diversity. Today besides the Grand Old Opry, the city also boasts the nation’s largest Kurdish population, and a thriving “Little Kurdistan,” as well as growing Mexican, Somali and other immigrant enclaves.

Other cities are equally surprising, including #2 Birmingham, AL; #3 Indianapolis, IN; #4 Louisville, KY and#5 Charlotte, NC, all of which doubled their foreign born population between 2000 and 2011. Right behind them are #6 Richmond,VA, #7 Raleigh,NC , #8 Orlando, Fl, #9 Jacksonville,Fl and #10 Columbus, OH. All these states either voted for Mitt Romney last year or have state governments under Republican control. None easily fit the impression of liberally minded immigrant attracting bastions from only a decade ago.

Although the New York metropolitan area still has the greatest numeric growth in immigrants since 2000, a net gain of more than 600,000, there’s no question that the momentum lies with these fast growing immigrant hubs.The reasons are not too difficult to fathom. In the modern global economy, migrants represent the veritable “canaries in the coalmine”. They go to economic opportunities are often the greatest, which often means thriving places like Nashville, Raleigh, Charlotte, Columbus or #11 Austin, TX. Housing prices and business climate also seem to be a factor here; all these areas have lower home prices relative to income than many traditional immigrant hubs.

As a result, many immigrants are moving from their traditional “comfort zone” cities with historical larger immigrant populations — New York, Los Angeles, San Francisco and Chicago — to generally faster growing, more affordable cities.

This is drastically reshaping the demographic future of the country. Over the past decade the increase in foreign born residents accounted for 44% of the nation’s overall population growth rate. With the U.S. birthrate heading downwards, at least for now, immigration represents perhaps the one way regions can boost their populations and energize their economies. It may be America’s biggest hope  as well in keeping Social Security and Medicare from collapse.

Ironically, even as they migrate elsewhere, immigrants also may prove particularly critical in some of our older cities. Newcomers have been vital to maintaining population growth or at least fending off stagnation. Los Angeles, Miami, New York, Chicago and San Francisco metros have maintained enough growth among the foreign born to keep going negative due to significant losses in net domestic migration. Yet even among biggest metros the biggest growth has been among lower-cost, until fairly recently largely native-born, regions such as Houston, Dallas-Fort Worth and Atlanta.

The impact on these areas is likely to be profound over time. Urbanists like to speak about the “great inversion” of upper-class professionals to cities, but it’s really the immigrants who provide the demographic and economic momentum for our largest metros. This point may be missed because many times immigrants — unlike the much cherished (and much publicized) hip, cool, largely white professionals — often do not choose to live in the overpriced, crowded urban core (although some may have businesses there).

Instead immigrants tend to cluster in the less dense, more affordable and spacious periphery, where their “American dream” of a single family house is often far more achievable. In Southern California, for example, decidedly exurban #25 San Bernardino Riverside added three times as many foreign born than long-time immigrant hub Los Angeles, despite having only one-third the total popoulation. Los Angeles actually recorded the smallest percentage growth in foreign born of any major U.S. metro.

Over time, the immigrant impact may prove greatest in terms of economics. Immigrants, in a word, tend to be resilient, and opportunistic by nature. Although many immigrants and their offspring still lag behind economically, over time they appear to be integrating. Overall their rate of home ownership still lags that of native born Americans, but appears to have held up better since the recession.

Nowhere is the impact greater than in the entrepreneurial sector. Between 1982 and 2007, the number of businesses owned by the primary immigrant groups, Asian Americans and Hispanics grew by 545% and 696% respectfully. In contrast businesses owned by whites grew by only 81%.

Perhaps more important still, even in the midst of the recession, newcomers continued to form businesses at a record rate, even as those by native-born entrepreneurs declined. The immigrant share of all new businesses, notes Kauffman, more than doubled from from 13.4% in 1996 to 29.5% in 2010.

Some emerging tech centers are particularly dependent on foreign born migration as evidenced by rapid growth in Raleigh, Austin and Columbus. Established tech centers like San Jose, San Francisco and Seattle also all have large foreign born populations. Overall immigrants are responsible for roughly a quarter of all high-tech start ups .

Much of this can be attributed to Asians, who constitute over 40%of all newcomers andnow stand as the fastest growing immigrant group. They now account for roughly twenty percent of all tech workers, four times their percentage of the population.

Yet these impacts will be felt well beyond the tech community. Professionals of all kinds are moving in record numbers from the riskier political environment and pollution of China, seeking places where they can use their skills most effectively. Immigrants also play an increasingly important role in such less tech oriented industries, from the garment, carpet and furniture industries as well as small scale retail enterprise.

Newcomers also are playing a major role in the reviving housing market, particularly in places such as New York, Los Angeles, Miami, Phoenix and the Bay Area. A house that might seem outrageously overpriced to the average American family might seem rather a bargain if you are coming from Hong Kong, Beijing or Shanghai.

It is likely that, if sensible reform is passed, these impacts will begin to extend to other parts of country — such as Cleveland, Milwaukee and Memphis — that still get very little new foreign immigration. Like Houston in the 1990s, these areas have affordable housing to attract newcomers and, with any resurgence of economic growth, could provide opportunities for up and coming immigrants. A decade ago, after all, who would have seen Nashville, the ultimate symbol of our country heritage, as a rising immigrant hub?

Joel Kotkin is executive editor of NewGeography.com and a distinguished presidential fellow in urban futures at Chapman University, and a member of the editorial board of the Orange County Register. He is author of The City: A Global History and The Next Hundred Million: America in 2050. His most recent study, The Rise of Postfamilialism, has been widely discussed and distributed internationally. He lives in Los Angeles, CA.

This piece originally appeared in Forbes.

Photo by telwink