Increased Immigration as an Inflation and Inequality Fighter.

• Author: Brannon, Ike

The inflationary spike in the United States over the last few months has the Biden administration scrambling to find ways to ease price levels. While its ability to do so is limited, a series of White House policy changes in early 2022 will boost the number of technology-worker immigrants and could help ease technology prices and give the economy a boost.

The administration will allow foreign students on a J-l visa to remain in the United States for up to three years to work and undertake practical training. The J-l visa typically covers scholars participating in research exchange programs, and current regulations only permit 12 months of practical training. Biden also expanded the number of fields eligible for this opportumty. The administration also increased the range of skills and expertise that will qualify a worker to receive an O-IA visa, which goes to persons of extraordinary ability in the fields of science, business, education, or athletics.

Lost workers / In the last two years, the pandemic has exacerbated what was already a tight labor market. There are now 1.5 million fewer workers participating in the U.S. economy than there were before the pandemic, and a sizable fraction of that loss appears to be permanent. This worker exodus has exacerbated supply issues currently plaguing the U.S. economy, which show few signs of abating. (See "Supply-Chain Myths," p. 26.)

Firms across a wide variety of industries are struggling to attract qualified applicants as well as retain current employees. The Bureau of Labor Statistics (BLS) reports that a record number of workers quit their jobs in March, yet new jobless claims in April were at historic lows. Most of the reduction in labor force participation rates appears to be from older workers who left their jobs, either because COVID made working less attractive or the stock market boom allowed them to accelerate their retirement date. Women's employment has also fallen precipitously in the last two years, but this may be a transitory phenomenon owing to pandemic-induced child-care issues.

While restaurants and food producers --two industries that tend to hire workers with relatively little education and training --have had noticeable troubles maintaining employment levels, labor shortages are occurring all across the skills spectrum. Many of the hardest-to-fill positions are in health care, a field hit particularly hard by the repeated waves of the pandemic. COVID has also exacerbated...