WASHINGTON – Refugees arrive in America with nothing, but after a decade here, they're more likely to be working than average Americans of the same age.
These newcomers depend on government aid when they arrive, but within eight years, they're paying more in taxes than they receive in benefits. And after 20 years, the average refugee will have paid $21,000 more in taxes than he or she ever received in government benefits.
What's more, young refugee children are just as likely to graduate from high school as American kids are.
Those are the central conclusions of a new academic paper by a top economist at the University of Notre Dame – one with great ramifications for cities such as Buffalo, which has welcomed more than 15,000 refugees in the past decade and a half.
"These people generally do very well," said William N. Evans, chairman of the Department of Economics at Notre Dame. "I think that's a very positive story."
While academic research on refugees is hard to come by, a handful of other academics have reached the same conclusion. That's one of the reasons why cities such as Buffalo and Utica deliberately welcome refugees – people who were driven from their homes in foreign lands and settled legally in the United States after a long vetting process.
Yet the conclusion that Evans and his research partner reached runs counter to the sentiment spelled out in President Trump's fiscal 2018 budget proposal.
"A large proportion of entrants arriving as refugees have minimal levels of education, presenting particular fiscal costs," Trump's budget summary stated.
The Trump budget cited a federal study that showed that of refugees who arrived nationwide in the previous five years, nearly half were on Medicaid in 2015, while 45 percent received welfare payments and 75 percent were on food stamps.
Evans' research indicates, though, that while refugees may start out on welfare, they generally don't stay there forever. After 10 years in America, the percentage of them receiving welfare and food stamps is comparable to that of native-born Americans.
That’s because so many refugees work, and work hard. The federal program that brings them to America requires the able-bodied to find jobs soon after they arrive.
Coming to America without skills and usually without knowing English well, refugees typically struggle in their first years and never earn as much as their American-born counterparts, Evans found.
But he also found that refugees who have been in America 10 years are more likely to be in the workforce, and more likely to be working, than native-born Americans.
Buffalo-area employers often praise refugees as hard workers.
"We've had many employers say to us: 'If it weren't for the refugees you refer to us, we would not have a successful company'," said Dennis C. Walczyk, chief executive officer of Catholic Charities of Buffalo, one of the city's four refugee resettlement agencies.
Litelab, a Buffalo lighting company, now employs more than 20 refugees in its 153-member workforce. Larry Christ, the company's chief operating officer and a partner with the firm, noted that one of his employees saw the Burmese Army kill his wife and children. Another fled his native Vietnam by swimming across the Mekong River.
Working and paying taxes
Such experiences forged a strong character in many refugees, making them hard-working and reliable, Christ said.
"They fit the profile of successful employees," he said. "They've not only helped lift themselves up, they've helped our employees understand what's great about America."
None of this comes as a surprise to Daniel Leong, a top official with the Karen Society of Buffalo, which represents the largest number of local refugees from Burma.
A refugee himself, Leong said he was on welfare when he arrived in Buffalo. But he now works as an interpreter and doesn't rely on government aid.
"A lot of people talk about us being a burden to the government, but you have to weigh the pros and cons," Leong said. "It's very few refugees who don't get a job. Many more people are working and paying taxes."
Leong called refugee resettlement "an investment for the government." And that's largely what Evans found in the working paper he and his colleague, Daniel Fitzgerald, found in the working paper they released this week through the National Bureau of Economic Research.
The longer the refugees are here, the more likely they are to work, and the more taxes they pay – which leads to the study's central conclusion.
"We estimate that refugees pay $21,000 more in taxes than they receive in benefits over their first 20 years in the U.S.," Evans and Fitzgerald write.
That's an important finding for Buffalo.
As thousands of refugees from around the world flocked to the city in recent years, the cost of social services to support them has grown nearly tenfold in Erie County in 10 years, The Buffalo News reported last year. The state and federal governments pay most of the cost, but Erie County taxpayers paid $7.4 million for welfare and Medicaid for refugees in 2015. That averages $8.02 for every person living in the county.
But that's just one side of the refugee resettlement equation. In a series called "From Burma to Buffalo," the News also found last year that the refugee influx gave an economic jolt to the city's far West Side and Block Rock Riverside. Job creation and the rate of business starts exceeded the county average between 2009 and 2014 in those long-troubled neighborhoods, where many of the newcomers live.
Evans based his research on the Census Bureau's American Community Survey, and the News used the same data set in its research last year.
Still, some critics of refugee resettlement – and even some supporters – criticize Evans' methodology.
"The claim that refugees contribute more in taxes than they receive in benefits is simply implausible," Jason Richwine, a researcher, said in a blog post on the website of the Center for Immigration Studies, which favors low rates of immigration.
While the study counts the amount of money spent on welfare, Medicaid, food stamps and several other direct-aid programs, Richwine said Evans' study lowballed the total government spends on refugees by excluding costs for public housing, education, law enforcement and infrastructure.
Meantime, Ann Brittain, who retired recently after 35 years with the Catholic Charities refugee resettlement program in Buffalo, contended that the study lowballs another important set of statistics. It doesn't include the tax receipts produced by refugee-owned businesses, of which there are now dozens in Buffalo alone.
"In the long run, in the majority of situations, they're bringing much more into the economy than they get from the government," Brittain said.
Evans' study also indicates that the second generation of refugees will likely contribute to the economy as well. That's because those who come to America as small children tend to do well in school -- a finding that also echoed The Buffalo News' research on the refugees from Burma.
For example, the city's last four Gates Millennial Scholarship winners are all refugees from Burma. And the Buffalo School District's list of this year's valedictorians and salutatorians shows that about 40 percent appear to be refugees.
But both The News and Evans found that refugees who came to America as teens were less likely to graduate from high school than American-born students, given that the language barrier they face is harder to climb in high school.
Overall, Evans' study is good news for Buffalo, said Isok Kim, an assistant professor of social work at the University at Buffalo who has studied the city's large community of refugees from Burma.
"This just adds to a growing recognition that the refugees we have resettled do pay back what they've been given, and then some," Kim said.