Refugee settlement produces a net economic benefit to host economies through tax revenue, productivity boosts, the filling of skills gaps and entrepreneurialism, a new report says.

The report, by the US-based NGO the International Rescue Committee, focuses on refugee settlement in America, but has lessons for the rest of the world.

It produces decades-worth of data that shows refugees make significant contributions to the US economy as well as bringing fresh perspectives, resilience and ingenuity that benefit the overall UJS economy.

The report cites a recent study by the US Department of Health and Human Services found that between 2005 to 2019, refugees and asylees generated a net fiscal benefit of $123.8 billion to the U.S. government.

Over this 15-year period, refugees contributed $US581 billion in tax revenue, outweighing the $US457.2 billion in government expenditures on them during that period – and far exceeding the cost of the programs supporting them for their first few months in the country.

The report says refugees enter the workforce at high rates, often filling labour shortages in critical industries.

“According to a 2023 report, refugees in the US earned a collective $US93.6 billion in household income in 2019 alone. That same year, they paid $US25 billion in taxes, including $US16.2 billion in federal taxes and $US8.7 billion in state and local taxes,” the report says.

Over time, refugee earnings increase significantly, it says.

“While refugees who have been in the US for five years or less earn a median household income of $US30,500, those who have been in the country for at least 20 years reach a median income of $US71,400—exceeding the national median of $US67,100. This upward mobility highlights their ability to integrate successfully into the economy and contribute meaningfully to their communities.”

The report says entrepreneurship is a key driver of economic growth, and refugees excel in this area.

“In 2019, 13 per cent of refugees in the US were entrepreneurs, surpassing the 11.7 per cent rate among non-refugee immigrants and the 9 per cent rate among US-born citizens. This amounted to nearly 188,000 refugee-owned businesses across the country,” the report says.

“Their businesses range from restaurants and retail shops to technology firms and transport services. In cities like Buffalo, NY, and Fargo, ND, refugee entrepreneurs have revitalized entire neighbourhoods, turning abandoned storefronts into thriving small businesses that create jobs and boost local economies,” the report says.

In Australia, refugees are twice as likely to start a business that Australia-born people.

Like Australia, many industries in the US face labour shortages, particularly in manufacturing, health care, and transport.

The IRC report says refugees help meet this demand.

“Many companies have actively recruited and hired refugees, recognising their strong work ethic and reliability,” the report says.

“A growing aging population in the US also underscores the importance of a steady, younger workforce.

“While 77.7 per cent of refugees and immigrants are of working age (16-64), only 61.3 per cent of the US-born population falls into this category. By joining the workforce, refugees help sustain industries and contribute to Social Security and Medicare, ensuring these programs remain viable,” the report says.

The report says refugees contribute to economic growth at state and local levels.

“In 2019, refugees had a collective spending power of $US68.6 billion, stimulating local businesses across the country. In California alone, refugees’ spending power reached $US20.7 billion, while in Texas, it was $US5.4 billion,” it says.

“Refugees make important tax contributions to many states. In 2019, the state and local taxes paid by refugees exceeded $US100 million in each of the 21 states, helping to support schools, roads, and public services,” the report says.

Read the IRC report here: How refugees strengthen the U.S. economy | International Rescue Committee (IRC)