What role will immigrants play in filling Texas’ open jobs in 2023?

Immigrants play a significant and wide-ranging role in Texas’ workforce, from providing seasonal work to founding a fair share of startups.

As the state’s economy grows and more businesses relocate to Texas, immigrants are expected to continue filling gaps in the workforce, especially as demographic pressures give rise to labor shortages and employers struggle to fill Texas’ nearly 870,000 open jobs.

Immigrants make up a higher percentage of the workforce than their share of the state’s population. They hold more than 20% of the state’s jobs, despite accounting for only 17% of Texas’ population, according to an American Immigration Council report.

But a disconnect between job openings and available workers will only continue to stress employers throughout the rest of the decade, said Cullum Clark, director of the Bush Institute-SMU Economic Growth Initiative.

“If we look to the future, what we very plainly concede is that all over America we face a very difficult demographic situation,” Clark said.

Immigrants represent a large share of people in Texas working as home health care aides and in the service industry and make up more than 70% of construction workers in Dallas-Fort Worth, according to a report recently published by the Bush Institute.

“What we’ve already seen is an enormous growth in the number of immigrants doing essential jobs in our state, in North Texas,” Clark said.

Ed Curtis, chief executive officer and founder of YTexas, a network aimed at supporting companies moving to or expanding in Texas, said companies are “seeking talent wherever they can get it.”

Two popular employment visas that permit temporary non-agricultural work and specialty work requiring college-level degrees, like in tech, finance or medicine, have congressionally mandated caps that were set decades ago. While there are exemptions and supplements to the limits, some say the caps aren’t reflective of today’s labor demands.

“We’ve kept the number of skilled worker visas at pretty much the same level for several decades now, even though the need for such workers has exploded,” Clark said. “That’s a dysfunctional situation.”

Texas employers requested and received more H-2B visas than any other state in the U.S. in the last fiscal year and sponsored the third most H-1B visas, according to U.S. Citizenship and Immigration Services data. This fiscal year, Texas employers sponsored the most H-2B visas and the second most H-1B visas of any state, behind only California.

Clark said a serious conversation surrounding comprehensive immigration reform hasn’t happened from policymakers across federal and state levels, despite urgent asks from the business community. Texas Gov. Greg Abbott has campaigned on tightening the flow of migrants across the border with Mexico.

Most recently, he deployed the National Guard to El Paso as thousands of migrants gathered near the border awaiting the lifting of Title 42, a Trump administration policy of rapidly expelling migrants that President Biden no longer wants to enforce. The Supreme Court on Tuesday extended a temporary stay on Title 42 that Chief Justice John Roberts issued last week.

“Maybe they don’t have all the facts,” he said. “Maybe they just don’t fully understand how the economy has changed, how the demographics of America have changed.”

Despite a recent decline in international migration to Texas, the Lone Star State has seen a rapid rise in gateway cities, or places people settle when first coming from abroad, over the previous three decades. Behind Houston, Dallas-Fort Worth is the second most important gateway.

In a recent ranking by the Bush Institute on immigration rates — defined as the net inflow of people into an area compared with that area’s total population in 2010 — Houston ranked seventh and Dallas 18th out of the top 100 metros across the country.

Areas with large immigrant populations make America’s cities more innovative and enterprising, according to the Bush Institute’s study. Immigrants are more likely than people born in the U.S. to start a business. It’s even more likely when it comes to tech-oriented or biotech-oriented businesses, Clark said.

In Dallas-Fort Worth, a quarter of venture-backed startups had at least one immigrant founder between 2016 and 2020, according to research by the Bush Institute with help from PitchBook and the National Venture Capital Association.

“It’s risky,” Clark said of founding a startup. “But collectively, it’s going to change the economy of the Dallas area a lot.”