Immigrants make up about 14% to 15% of the U.S. population but recently generated about $1.7 trillion in economic activity. A new report from The Mendoza Law Firm finds that this economic role sits alongside growing policy uncertainty for millions of children, most of them U.S. citizens. The report is built on 2024 Census Bureau data showing that 26% of American children, almost 20 million, have at least one immigrant parent, and that 88% of those children are citizens.
The financial contribution is large. In the most recent year measured, immigrant households paid $382.9 billion in federal taxes and $196.3 billion in state and local taxes, a combined total of about $579 billion. They also held $1.6 trillion in spending power. Undocumented immigrants paid $96.7 billion in combined taxes, an average of $8,889 per person, including $25.7 billion toward Social Security, even though most can’t claim benefits. Recent immigration is projected to add $348 billion to Social Security revenue between 2024 and 2034, while the workers paying in are expected to draw only about $1 billion, a return of nearly 350 to 1. Immigrants also paid more than $167 billion in rent and hold $6.6 trillion in housing wealth.
Immigrant families also create businesses and jobs. Immigrants and their children founded more than 20% of new U.S. businesses in the past year, and 46% of Fortune 500 companies were founded by immigrants or their children. Immigrant owned businesses are more likely to hire: 91% employ at least one worker, compared with 84% of new businesses overall. Businesses that are majority immigrant owned employ one in seven private sector workers and generate more than $1 trillion a year. The next generation continues the pattern. Adult children of immigrants make up 7% of the U.S. healthcare workforce, more than 1.4 million people, including 11% of physicians and surgeons. They contribute about $1,700 per person to state and local budgets, and their own children add another $1,300.
At the same time, the report describes major changes in the policies that affect these families. A January 2025 executive order tried to end automatic citizenship for some children born in the U.S. to noncitizen parents. The Supreme Court ultimately ruled that the 14th Amendment protects birthright citizenship regardless of a parent’s status. Still, the fact that the question reached the Court shows how much uncertainty these families have faced. For health coverage, the Congressional Budget Office projects that the 2025 federal budget reconciliation law will cause 1.4 million lawfully present immigrants to lose coverage by 2034. That includes 100,000 through Medicaid and CHIP restrictions, 1.2 million through ACA Marketplace changes, and 100,000 through Medicare changes. Those affected include refugees, asylum seekers, trafficking and domestic violence survivors, and visa holders, many of them parents of U.S. citizen children.
Enforcement changes have also affected children directly. On January 20, 2025, federal protections limiting immigration enforcement at schools, hospitals, and churches were rescinded. Enforcement activity that followed was linked to a 22% increase in daily student absences, especially among younger students. About 5.5 million U.S. citizen children live with at least one undocumented parent, and 1.8 million live with two. In total, 9.7 million U.S. citizens share a home with someone who is undocumented. That means an enforcement action could cost a family a caregiver, housing, or income even when the child’s own citizenship is secure.
The report also cites modeling on the wider economic effects. A large-scale deportation effort could reduce GDP by 4.2% to 6.8%, or $1.1 trillion to $1.7 trillion. It could remove about 1.5 million construction workers, 1 million hospitality workers, 870,000 manufacturing workers, 461,000 transportation and warehousing workers, and 225,000 agricultural workers. It would also cost an estimated $46.8 billion a year in federal tax revenue and $29.3 billion in state and local revenue.
The report concludes that children of immigrants are an established, largely American, and economically important part of the country’s future, and that the uncertainty around their families’ status places a heavy and often overlooked burden on them.
