How have CBO and Brookings projections about immigration-driven GDP and employment changed since 2021?
Executive summary
Since 2021 the Congressional Budget Office revised its demographic baseline sharply upward to reflect an unprecedented post‑2020 immigration surge, and those revisions have lifted CBO’s projections of nominal GDP and federal revenues while also changing the presumed pace of sustainable employment growth; Brookings-affiliated researchers incorporated those CBO revisions to conclude that immigration accounted for a much larger share of employment capacity in 2023–24 but then updated their view in 2025–26 as net migration slowed and the breakeven job‑growth numbers fell [1] [2] [3] [4].
1. CBO’s big upward reset: from routine trend to a “surge” that raises GDP by trillions
Beginning with its updated demographic and budget outlooks, CBO concluded that net arrivals since 2021 were far above earlier projections — roughly 8.7 million “other‑foreign‑nationals” over 2021–26 relative to pre‑2021 trends — and that the surge raises nominal GDP by about $8.9 trillion over the 2024–2034 period (and by $1.3 trillion, or roughly 3.2 percent, in 2034 in one presentation of the numbers) while increasing federal revenues and lowering deficits on net over 2024–2034 [5] [2] [1] [6].
2. What that meant for employment capacity in Brookings’ read of the data
Brookings researchers, using CBO’s higher immigration estimates and revised Census population inputs, argued that the labor market could sustainably absorb far more monthly employment gains than pre‑pandemic models suggested — estimating sustainable employment growth of roughly 160,000–230,000 per month in 2023 and 160,000–200,000 for 2024, about double the pre‑pandemic central ranges — a conclusion explicitly tied to CBO’s upward revisions of net migration for 2022–24 [7] [3] [8].
3. The mid‑decade pivot: falling net migration, lower breakeven jobs, a more nuanced Brookings update
By January 2026 Brookings updated its macro estimates to reflect a slowdown and likely negative net migration in 2025, noting that breakeven employment (jobs consistent with stable unemployment) in late‑2025 fell to roughly 20,000–50,000 per month under a high‑immigration scenario and could dip into negative territory in 2026, and that reduced immigration shaved GDP growth in 2025 by roughly 0.2–0.3 percentage points [4].
4. CBO’s later revisions and the long view: a surge that wanes in projections
CBO’s demographic update and budget outlooks show the initial large upward shift in population and labor force driven by 2021–24 flows, but also project that net immigration in certain categories will drop — for example, projected net inflows in the “other‑foreign‑national” category fall to zero in 2026 and then to more modest positive flows later in the decade — which tempers long‑run employment effects even as population gains continue to lift GDP relative to pre‑2021 baselines [9] [10].
5. Consensus on direction, disagreement on magnitude and timing; uncertainty dominates
Across CBO, Brookings, Dallas Fed analyses and other commentators, there is agreement that higher immigration since 2021 raised both GDP and the economy’s capacity to absorb jobs, but they diverge on timing and scale: CBO’s baseline treats the surge as a sustained shift that materially boosts nominal GDP and federal receipts [2] [1], Brookings initially translated that into much higher sustainable monthly employment growth for 2023–24 [7] [3] and later revised to recognize a slowing of flows and weaker breakeven job growth in 2025–26 [4], while other analysts use the CBO projections as a benchmark to assess policy‑driven declines in immigration and their negative GDP effects [11]. All sources emphasize substantial uncertainty in migration measurement and in how quickly newcomers will participate in the labor market and access benefits, which leaves quantitative estimates sensitive to updated data and policy shifts [1] [12].