Mass Deportation Policy Could Shrink Arizona Economy

SB-1070 Mass Deportation Policy Could Shrink Arizona Economy By $48.8

When Arizona passed SB-1070 last year, the state began to feel the economic pain almost immediately due to a boycott that was organized in response. This past fall, the Center for American Progress, along with the consulting firm Elliott D. Pollack & Company, found that the boycott itself could cost the State Convention Industry 2,800 jobs and $141 million.

Thursday, the Center for American Progress, together with the Immigration Policy Center, released a report that details the more long-term economic effects of the law itself. According to the study, the SB-1070 approach “would have devastating economic consequences” if its goal of driving out undocumented immigrants was accomplished. “Driving the undocumented immigrants out of Arizona would lead to significant losses of jobs for both native-born and foreign-born workers,” states the report. “It would trigger a significant contraction of the state economy as it struggles to grow its way past the Great Recession. And it would lead to substantial lost tax revenue for the state government which is already reeling from the recession and high unemployment.”

The report compares the cost of mass deportation versus the economic benefits associated with legalizing Arizona’s undocumented population:

Deportation effects in Arizona

Decrease total employment by 17.2 percent

Eliminate 581,000 jobs for immigrant and native-born workers alike

Shrink state economy by $48.8 billion

Reduce state tax revenues by 10.1 percent

Legalization effects in Arizona

Increase total employment by 7.7 percent

Add 261,000 jobs for immigrant and native-born workers alike

Increase labor income by $5.6 billion

Increase tax revenues by $1.68 billion

The report does not include an analysis of the costs associated with defending SB-1070 in court. Since Gov. Jan Brewer (R-AZ) signed the bill into law in April, the state of Arizona has spent over $1.5 million fighting legal challenges against it and will likely spend even more as the lawsuit moves its way through the courts.

Arizona is currently facing an estimated $825 million budget deficit. Brewer has already proposed a budget containing $1 billion in spending reductions to Medicaid and other services. Republicans are now demanding another $600 million in additional spending cuts, including $200 million from K-12 education.

Andrea Nill

Wonk Room