A key factor that has gone mostly unnoticed is that the pickup in US growth last year came from a sharp rise in net immigration. In simple terms, more workers generate more goods and services. A larger number of people earning paychecks means more consumer spending. And more people paying income tax on earnings boosts tax revenues. Last year, the US population rose by 0.9% in 2023, much faster than the US Census Bureau forecast of 0.5%. And the prime-age workforce participation rate—ie 25- to 54-year-olds—reached 83.5% in February, matching highs that hadn’t been seen since the early 2000s. Much of this is due to immigration. The US economy is outperforming in GDP terms mainly because of net immigration, twice as fast as in the Eurozone and three times as fast as Japan.

US economy: saved by immigrants