Over the past five years, the U.S. labor market has seen a net gain of 5.4 million jobs, according to the U.S. Bureau of Labor Statistics’ household survey. The establishment survey reports an even larger increase of seven million jobs. While differences exist between the household (Current Population Survey) and establishment (Current Employment Statistics) surveys, the household survey is used here because it provides the necessary demographic details for analyzing workers. Among the 5.4 million new jobs, nearly all net gains were attributed to foreign-born workers, who accounted for 4.7 million of them. Meanwhile, the number of native-born workers in the U.S. has grown by only around 650,000 since early 2020.
This raises the question: Are foreign-born workers actually “taking jobs” from native-born Americans? The answer is no, and understanding why requires examining the broader labor force trends among native-born workers.
One key factor to consider is that while the absolute number of native-born workers has declined, the percentage of native-born Americans of prime working age (25–54) has slightly increased over the past five years. Using a 12-month average, the prime-age employment rate for native-born workers was 80.7 percent in January 2020, rising to 81.5 percent by January 2025. Foreign-born workers also experienced an increase over the same period, from 77.1 percent to 78.1 percent. Both figures are now at their highest recorded levels since data collection began in 2007.
These employment trends may appear contradictory given that all net job gains have gone to foreign-born workers, but they are actually consistent. The number of native-born Americans in their prime working years has remained largely unchanged since around 2013, as noted by Cato Institute’s Scott Lincicome. This issue is expected to intensify, as the U.S. birth rate has been on a steady decline since 2007—exactly 18 years ago. This demographic trend means that the number of native-born Americans entering the labor force will continue to shrink in the coming years. In fact, the U.S. fertility rate (births per woman) in 2023 was nearly 25 percent lower than in 2007.
Efforts to boost fertility rates through government policies have largely proven to be costly and ineffective. However, some analysts suggest that reforms could help. Vanessa Brown Calder and Chelsea Follett have compiled a list of policy recommendations aimed at increasing birth rates, many of which involve reducing government interventions. Nevertheless, absent major reforms, it is unlikely that the native-born working-age population will grow significantly in the near future. Even if birth rates were to rise immediately, it would take 18 years for these new workers to enter the labor force and decades for the impact to become substantial.
In contrast, the number of foreign-born individuals in the prime working-age group has been increasing. While the native-born prime working-age population has remained stagnant since 2013, the foreign-born equivalent has grown by nearly five million over the same period. These figures come from the Current Population Survey, which is conducted jointly by the U.S. Bureau of Labor Statistics and the U.S. Census Bureau. Like any survey, it has limitations, particularly in identifying certain demographic groups such as immigrants. However, it remains the most reliable data source available for these estimates, as it is the same survey used to measure unemployment and other labor market indicators. With the scheduled benchmark update in January 2025, the Census Bureau’s population estimates should improve the accuracy of these data.
Without continued immigration, the U.S. faces serious demographic challenges. Predicting the future is difficult, but based on Census Bureau population projections, William Frey of the Brookings Institution estimates that the ratio of workers to retirees will decline significantly under any scenario. The most extreme case—a “zero immigration” scenario—suggests that the current ratio of 3.6 workers per retiree could plummet to just 1.4 by 2100. Even under a “high immigration” scenario, the ratio would still decline to approximately 2 workers per retiree. The economic and fiscal differences between these two scenarios could be enormous.
Maintaining a healthy worker-to-retiree ratio—sometimes called the old-age dependency ratio—is essential for the long-term stability of the U.S. economy. As the population ages, retirees will require substantial healthcare services, creating demand for more healthcare workers. Many retirees also hold significant wealth and will want to spend it on industries such as travel and tourism. Beyond these sectors, many industries that are not currently foreseeable will also require new, younger workers to sustain future economic growth.
While it is true that most new jobs in the U.S. economy have gone to foreign-born workers, this does not mean that these workers are displacing native-born Americans. Instead, it highlights the increasing need for immigration to address demographic challenges. Restrictive immigration policies could exacerbate the labor shortages that arise from an aging population. Without a steady flow of new workers, the U.S. would need to rely on massive advancements in automation and productivity across various industries. Achieving such improvements would require fewer regulatory burdens and lower taxes to encourage innovation.
Ultimately, the data suggest that immigration plays a vital role in supporting the U.S. labor market. As birth rates decline and the native-born working-age population stagnates, foreign-born workers have become increasingly essential to maintaining economic stability. Looking ahead, policies that promote a more open approach to immigration will be crucial in ensuring that the U.S. workforce remains robust enough to support retirees, drive economic growth, and sustain critical industries.