US | SCOTUS Immigration Ruling Will Have ‘Chilling’ Economic Consequences

The Supreme Court on May 16, in a closely watched immigration case, held that federal courts lack jurisdiction to review questions of fact arising from discretionary-relief in immigration proceedings.

In other words, even if an applicant feels that an error was made in denying their application, they have almost no ability to request judicial review.

From a legal standpoint, critics feel that the majority’s argument in Patel v. Garland fails to consider basic principles of statutory construction. From a policy standpoint, critics feel that this restriction on judicial review will have severe consequences for immigrants in removal proceedings.

In light of current labor shortages, however, Patel could also have economic consequences. Whether it’s labor shortages, supply-chain interruptions, or the “Great Resignation,” immigrants are vital to the solution. Unfortunately, immigrants are already traumatized by Trump-era policies and historic backlogs.

Now, as a result of Patel, the perception that one factual error could result in a denial of a green card application with no legal recourse will only deepen that trauma.

If this decision dissuades highly skilled workers from accepting offers of permanent employment in the U.S., and immigration levels drop even further as a result, the current economic situation may worsen.

The Unprecedented Decline in Lawful Immigration

The Trump administration issued 400 executive actions making it harder for immigrants to live and work in the US. The 6% H-1B denial rate before Trump took office increased to an all-time high of 24% in 2018, only to immediately drop down to 4% during Biden’s first year in office.

Overall, the number of new international students enrolling in U.S. universities has dropped by 45.6% between 2019 and 2021. Simultaneously, Canada began to ease its immigration policies. Immigrants who once aimed to live and work in the US began to opt for Canada instead. US companies began receiving requests from their immigrants to relocate to Canada, particularly from H-1B workers who feared their H4 spouses would lose employment authorization.

In contrast to the decline in the US, Canada’s skilled immigration program rose 75% between 2017 and 2019. Canada has emerged as the new number one destination for international workers, beating the US for the first time in decades.

Meanwhile, in 2020, Covid-19 paralyzed international travel and forced border and embassy closures as well as travel bans. As a result, US immigration further decreased in volume.

For example, the number of H-1B visas issued fell to under 62,000 in 2021 from 190,000 in 2020. In general, the US received 630,000 fewer international workers, representing a 75% drop from its peak in the years prior.

As the world grappled with Covid, a new topic began to dominate immigration conversations: Backlogs.

Delays in the processing of immigration applications reached unprecedented levels. By November 2020, the backlog for employment-based immigrants had surpassed 1.2 million applicants. As of April 2022, the U.S. Citizenship and Immigration Services had 8.5 million pending cases, of which 5.3 million were pending beyond published processing times.

Economic ‘Chilling Effect’

The US is currently experiencing the most significant labor shortage since World War II. As of January 2022, the US had 11.3 million jobs to fill but not enough workers to fill them.

A key contributor to this labor shortage is the decline in lawful immigration numbers resulting from the above-mentioned factors. It’s estimated that the US workforce has about 2 million fewer immigrants as compared to pre-pandemic levels, creating large labor gaps in a broad spectrum of industries.

For example, open STEM positionsoutnumber qualified workers by 3 million, and it’s estimated that the country will have a doctor shortageof 139,000 doctors by 2033. These labor shortages are resulting in inflation, reduced output, and supply-chain interruptions.

Now is not the time to discourage immigrants from applying for immigration benefits. The events of the last six years have already raised concerns that immigrants will be less likely to accept positions in the US because of a combination of US immigration policies and more attractive alternative destinations, such as Canada.

But the backlogs have taken these concerns to the next level. Take, for example, the plight of immigrants from India.

For Indian immigrants, the average US green card journey is 15+ years from start to finish. An Indian green card applicant faces a wait time of over a decade before they are eligible to even submit the application. Backlogs add even more delays to an already long process.

Decisions such as purchasing a home are more difficult to make because immigrants don’t know when they’ll become permanent residents. Further, the prospect that their American-born children will be forced to leave the US if the parents’ green card application is unsuccessful is terrifying to immigrant parents.

Loss of Skilled Workers

Hence the chilling effect: If an immigrant faces a journey of 3 to 15+ years until they get a green card in a system where, under Patel, a denial has no judicial recourse, why would they take the risk of choosing the US over another country with more favorable immigration laws?

Even if the application of Patel is further narrowed in future litigation, the mere perception of risk may dissuade immigrants from pursuing a green card. If immigrants are discouraged from pursuing a green card, then they are certainly less likely to accept job offers.

If this happens, the country has no hope of filling the gaps caused by massive shortages. In sum, the impact of Patel cannot be viewed in a vacuum. In addition to legal and policy consequences, we need to prepare for the possibility of economic consequences as well.

This article does not necessarily reflect the opinion of The Bureau of National Affairs, Inc., the publisher of Bloomberg Law and Bloomberg Tax, or its owners.

Hiba M. Anver is a partner with Erickson Immigration Group and adjunct faculty at the George Washington University School of Law. At EIG, she leads an international team that manages clients in various industries, and advises corporate clients on complex immigration matters resulting from restructuring, including mergers, acquisitions.