Best States for Immigrants

April 10, 2017 by Mike Sauter

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The California Senate passed a bill this month that provides a number of protections to immigrants in the state in light of recent crackdowns by Immigration and Customs Enforcement. The legislation limits the power of ICE agents to draw upon the resources of local law enforcement.

With the law’s passage, California is now being called the nation’s first “sanctuary state” at a time when the Trump administration has been targeting illegal immigration and so-called sanctuary cities.

Safety and continued residency are only some of the concerns facing non-natives living in the United States. Different parts of the country provide different earnings, education, and homeownership potential. Some also have communities of fellow immigrants that can help ease the transition.

24/7 Wall St. reviewed data on the presence and prosperity of immigrants in each state and ranked all 50 based on their favorability for foreign-born residents. California ranks as the best state for immigrants, while South Dakota ranks as the worst.

Establishing a new life and finding success in the United States can be difficult. Incomes among immigrants tend to be lower and poverty rates tend to be higher than among native-born residents.

Notably, unemployment tends to be lower among foreign-born than among U.S.-born residents. While the unemployment rate among native-born citizens is 5.3%, it is just 5.0% for immigrants. In Alaska, another of the best states for immigrants, the unemployment rate is 2.6 percentage points lower among immigrant workers than among the native-born labor force. This phenomenon is likely in part because immigrants must maintain employment to have their visa renewed.

One factor determining a state’s favorability for immigrants was the share of state residents who are non-natives. This ranges from a 27% share in California to just 1.5% in West Virginia. Having relatively few immigrants does not necessarily make the state inhospitable, however, as in the case of West Virginia, which ranks third best on our list.

However, many of the best states for immigrants, such as New York, California, New Jersey, and Florida, have large immigrant populations. These states are home to major metropolitan areas with distinct communities of immigrants from countries all over the world. For new immigrants, these communities provide access to others who speak their first language and have gone through the process of becoming a full-time resident. This is a potentially helpful, if not necessary, component of a smooth transition to full integration.

While we rank states based on the economic outcomes for foreign-born residents, it is important to note that outcomes in each state tend to vary based on more than simply a resident’s status as native-born or foreign-born.

For example, naturalized immigrants overwhelmingly tend to have much higher incomes, and are much more often highly-educated, than non-citizen foreign-born residents. Among immigrants, the poverty rate for those who are citizens is 11.4% — less than the rate for native-born residents — while nearly 25% of non-citizens from other countries are poor. There are also substantial differences in economic outcomes depending on the region of origin of non-natives living in each state.

To determine the best states for immigrants, 24/7 Wall St. constructed an index consisting of five socioeconomic measures intended to reflect the success and ease of assimilation for foreign-born citizens relative to the native-born population within a given state. Three of the measures — median household income, poverty rate, and unemployment — came from the U.S. Census Bureau’s 2015 American Community Survey. The disparities in median household income, poverty rate, and unemployment among the native- and foreign-born populations were standardized using min-max normalization and added to a composite index. The index also includes the normalized value for the share of the overall state population that is foreign born, which also came from the ACS, and the number of green cards issued within the state as a share of the total number of green cards issued nationwide in the 2015 fiscal year. Green card data came from the Department of Homeland Security’s 2015 Yearbook of Immigration Statistics. Supplementary data used in our analysis but not our index, such as educational attainment, household size, and employment composition by citizenship status, also came from the ACS.