The study included reduced earning and spending from illegal immigrants who left the state. Study: Alabama law costs $11B

Alabama’s controversial immigration law, considered one of the toughest in the nation, is costing the state’s economy up to a whopping $10.8 billion annually, according to a new study.

Under the law, which passed in the state last year, police are allowed to detain individuals suspected of being an illegal immigrant and cannot produce proper documentation to show their status. Some provisions of the law were stayed by the courts, but the law has still resulted in families fleeing the state to avoid the new strict rules.


The cost-benefit analysis, conducted by economist Samuel Addy of the University of Alabama, determined that the estimated 40,000 to 80,000 unauthorized immigrant workers fleeing the state have resulted in 70,000 to 140,000 jobs lost and $2.3 to $10.8 billion reduction in Alabama’s GDP annually.

Also, the law is estimated to cost Alabama $56.7 to $264.5 million in reduced state income and sale tax collections, as well as $20 to $93.1 million less in local sales tax collections, the report found.

The study’s conclusions were based on an examination of a wide range of costs that result from the law, including in its implementation, enforcement and litigation expenditures, costs derived from decrease in economic development opportunities and reduced earning and spending from illegal immigrants who have left the state.

“Nobody can fault the intent of the immigration law, which targets illegal immigration, but the law itself is costly mainly because it reduces demand in the state economy,” wrote Addy. “Instead of boosting state economic growth, the law is certain to be a drag on economic development even without considering costs associated with its implementation and enforcement. … While the law’s costs are certain and some are large, it is not clear that the benefits will be realized.”

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