Despite political rhetoric, immigrants drive Alabama’s economy

In a state where economic challenges often dominate headlines, the role of immigrants — particularly undocumented workers — remains a crucial but underappreciated factor in Alabama’s economic equation.

Immigrants make up a modest 4 percent of the state’s population, while undocumented people make up about 1.2 percent. But their influence on key industries, public finances and community well-being far exceeds their numbers. From construction sites to farmland, their work drives Alabama’s economy and underscores the inextricable link between immigration policy and economic prosperity.

The backbone of Alabama’s economy

Immigrants are essential to Alabama’s economy and fill critical roles in industries critical to the state’s success. In the construction sector, immigrants make up 9 percent of the workforce and provide the labor needed to complete infrastructure projects and housing developments. Without their contributions, delays on projects from highways to new commercial centers would become routine.

Agriculture, one of Alabama’s economic cornerstones, relies heavily on immigrant labor, particularly for tasks that domestic workers often avoid, such as planting, harvesting and processing. In 2021, Alabama ranked among the top 20 states in agricultural production, a feat that would be impossible without immigrant labor.

The hospitality and food service industries, critical to Alabama’s $17 billion tourism sector, also rely on immigrants to maintain operations. Additionally, immigrants make up 7 percent of the building and grounds maintenance workforce, keeping public and private spaces across the state clean and functioning.

The collective absence of immigrant workers would send shockwaves through these industries, leading to unharvested crops, stalled infrastructure projects, and disruptions to local economies.

Tax Contributions of Undocumented Immigrants

Despite their undocumented status, immigrants are not an economic burden; Instead, they actively support Alabama’s public finances.

In 2022, undocumented immigrants contributed an estimated $146 million in state and local taxes, funding public services such as schools, health care, and transportation infrastructure. These taxes include sales, property and income taxes, highlighting their integration into the state’s financial systems.

Nationwide, undocumented immigrants pay nearly $12 billion annually in state and local taxes, a figure that underscores their significant contributions even though they lack access to many public benefits. This cash injection is particularly important in Alabama, where state revenues often fall short of meeting critical needs.

Immigrants also bring economic diversity and skills to Alabama. About 33 percent of immigrant adults have a college degree, exceeding the share of the native-born population. This higher level of education strengthens industries that require specialized skills, from healthcare to technology, and complements the manual jobs that immigrants also perform.

The high cost of restrictive policies

Enforcing restrictive immigration policies would have serious economic consequences for Alabama. Labor shortages, already a challenge in agriculture and construction, would escalate into a full-blown crisis. With fewer workers to plant and harvest, crops could rot in the fields, leading to financial losses for farmers and jeopardizing Alabama’s agricultural production.

The consequences would also extend to public finances. Deporting undocumented immigrants would result in a loss of $146 million a year in tax revenue, widen budget gaps and strain public services. Alabama’s gross domestic product (GDP) would decline as industries that rely on immigrant labor – such as food processing, manufacturing and hospitality – struggle to operate efficiently.

Similar scenarios have played out elsewhere. After strict immigration laws were passed in 2011, Georgia’s agricultural sector faced a labor shortage so severe that farmers reported $140 million in unharvested crops. Alabama could suffer even greater losses because it relies on immigrant workers in several sectors.

A Path Forward: Balancing Enforcement and Economic Reality

While tough immigration rhetoric may appeal to certain political voters, it is increasingly at odds with Alabama’s economic needs. Immigrants are not just workers, but integral members of the communities they serve, contributing to the financial health and social fabric of the state.

Ignoring these realities for short-term political reasons risks long-term economic stagnation.

Pragmatic solutions could include creating pathways to legal residency or citizenship for undocumented workers, allowing them to fully integrate into the formal economy. Such measures would stabilize labor markets, safeguard Alabama’s agricultural and industrial production, and ensure that businesses have access to the workers they need to thrive.

Additionally, fostering an inclusive environment would benefit all Alabam residents. Reducing fear and insecurity in immigrant communities can increase productivity, promote entrepreneurship and strengthen social cohesion. States that have taken such measures have seen economic gains, proving that policies based on pragmatism and inclusiveness pay off.

Immigration as an economic opportunity

Alabama is at a turning point. It can continue to pursue policies that undermine the immigrant workforce and destabilize the state’s economy, or it can embrace solutions that recognize the indispensable contributions of immigrants. Immigrants – both documented and undocumented – play a central role in Alabama’s industry, tax base and communities. Eliminating them would lead to labor shortages, reduce public revenues and harm the sectors that support the state.

The future of Alabama’s prosperity depends on crafting policies that balance enforcement with economic realities. Immigration is not only a challenge to be overcome, but also an opportunity to be seized. Recognizing the value of immigrants in shaping Alabama’s economy is not only practical, but essential to a prosperous and inclusive future.