May 5, 2025
Mexican farmworkers harvest broccolini near Salinas California. Copyright David Bacon
Mexican migrants in the U.S. generate $2.27 trillion, making it the eighth-largest economy globally. Legalization would add $15 billion annually in taxes. The Mexican economy in the U.S. ranks among the world’s top 8.
The 38 million residents of Mexican origin in the United States collectively generated $2.27 trillion in GDP during 2024, a figure representing 11% of the entire U.S. economy and exceeding the Gross Domestic Product of nations such as Brazil, Canada, or Mexico itself.
This was revealed in a report by the Department of Chicano/a and Central American Studies at the University of California, Los Angeles (UCLA), led by researcher Raúl Hinojosa Ojeda, chair of that academic unit and founder of the North American Integration and Development Center (NAID), in an interview with the newspaper La Jornada.
According to the study, Mexican migrants born in Mexico—both documented and undocumented—generated $792 billion in economic activity, while the population of Mexican origin born in the United States contributed an additional $1.311 trillion. Together, this Latino economy in the U.S. reached $4.2 trillion, equivalent to the economy of Germany.
The Eighth Invisible Global Power
The report highlights that the economic power of Mexican migrants in the U.S. alone would constitute the eighth-largest economy on the planet. This community surpasses countries such as Brazil, Canada, Italy, or Australia in terms of economic output and accounts for more than half of all Latino economic output in the United States.
“This constitutes the eighth-largest economy on Earth, 54 percent of the total Latino economic output in the United States, and 11 percent of the entire U.S. economy,” Hinojosa Ojeda wrote in the report.
Mass Deportation: The Self-Inflicted Disaster
For the researcher, the U.S. government’s anti-immigrant policies represent a missed opportunity of enormous magnitude. “The mass deportation strategy is the worst self-inflicted economic disaster, probably even worse than the trade war,” he warned in an interview with the newspaper La Jornada.
Hinojosa argues that the failure of the original Free Trade Agreement—which did not include channels for legal migration or coordinated investment in infrastructure—represented a massive missed opportunity. If that effort at economic integration had been implemented starting in the 1990s, the GDP of people of Mexican origin would today be nearly $3 trillion, while Mexico’s GDP would be double its current size.
Regularization is not a favor, it is an economic boom
One of the report’s central conclusions is that the migrant regularization of the approximately 4 million undocumented Mexicans would generate a significant fiscal and labor impact for the United States.
“Regularizing the approximately 4 million undocumented Mexicans would add $15 billion annually in U.S. tax revenue, raise wages for all workers with limited training through formalization, and reduce the informal economy premium that currently subsidizes exploitative employers,” explained Hinojosa.
The report also notes that undocumented Mexicans already contribute $36 billion annually in taxes, including $14 billion for social programs they cannot access. “Regularization is not a favor to Mexico, but a massive economic boom for the United States,” he emphasized.
Remittances as a driver of productive investment
Remittances to Mexico exceed $60 billion annually. The report proposes channeling up to 10% of that flow toward productive investments, a model already implemented by countries such as India, China, and Israel.
“The Mexican government could offer immigrants the ability to save their money in Cetes, which currently generate a 10% rate of return,” proposed Hinojosa. With this mechanism, up to $6 billion annually could be generated to invest in Mexico’s poorest regions.
This initiative, which Mexico could implement unilaterally, would reduce the incentive to migrate and benefit both economies. For it to be fully effective, the researcher suggests repealing the 1% tax on remittances imposed by the U.S. Congress last year.
Proposals for Real Integration
Hinojosa’s report includes a broader set of recommendations: strengthening the labor and environmental infrastructure of the USMCA, reviving the North American Development Bank, reactivating the Community Investment Adjustment Program—abandoned after the original treaty—and developing a joint strategy between Mexico and the United States for economic integration with legal migration channels.
The researcher concludes that the economic power of the Mexican diaspora is undeniable, but its potential remains untapped due to decades of restrictive policies and a lack of binational planning. Changing that trajectory, he asserts, would generate enormous benefits for both countries.
Source: Alpha Plus TV