For Marcelo, a construction worker who lives in Silver Spring, the way he will live out his old age will likely depend on the details of an immigration reform plan that a group of U.S. senators intend to unveil next week.
Marcelo, an undocumented immigrant who moved to the United States in 1999, and his wife, an undocumented house cleaner, have no retirement savings, although both have paid taxes since arriving from their native Bolivia.
“Sometimes it’s like you’re wasting your time,” said Marcelo, 48, who did not want his last name used because of his immigration status. “When you think of the future, there’s nothing coming.”
An immigration reform package is likely to include a path to citizenship for the nation’s 11 million undocumented immigrants, many of whom already file tax returns and pay into the Social Security trust fund. Now, as the imminent retirement of 78 million baby boomers puts Social Security on a steady course toward depletion, some experts are debating whether legalizing the undocumented and encouraging immigration will help shore up the system with tax contributions or drain it by adding more beneficiaries to the rolls.
A low birthrate and a disproportionately large population of aging baby boomers have created a top-heavy ratio of retirees to working-age Americans, with too few younger workers to support government benefits at current levels.
Some argue that if undocumented immigrants are allowed to live and work here legally, they will contribute more. “There is the hope that they would get better jobs . . . and fewer of them would be under the table,” said Leighton Ku, professor of health policy at George Washington University. “If you’re legalized, your employment opportunities improve a lot.”
A 2012 Social Security Administration report estimated that, on balance, adding more immigrants would give a slight boost to Social Security, since the population of workers would rise sooner than the population of beneficiaries.
But the boost is not large. Currently, about 1 million immigrants per year come to the United States; whether this number stays the same or increases to 1.37 million, the fund will be depleted around 2033, the report said, noting that the fund gets a .07 percent gain for every additional 100,000 immigrants.
“It is relatively small,” said Madeleine Sumption, senior policy analyst at the Migration Policy Institute. “But given the extent of the problem, Congress is going to want to be looking for all of the avenues that they can use to improve the financial health of Social Security, and if you look at what the other options are, there’s a limited number of things you can do.”
Possibilities, she said, include some combination of immigration, tax hikes, benefit cuts and raising the retirement age — all politically difficult moves.
Dowell Myers, an immigration expert at the University of Southern California’s Sol Price School of Public Policy, said that while a steady inflow of immigrants will not eliminate the imbalance, the problem would be much worse without them.
“Immigrants contribute far more in their working years than they are a burden on the ratio in their senior years,” he said. “Having more immigrants means more workers to carry the load. And then immigrants have their own children, and they help carry the load.”
But Steven Camarota, director of research at the Center for Immigration Studies, which supports limits on immigration, said that America’s immigrants are not young or fecund enough to shore up the system.
“If the immigrants all came at 20 and had seven or eight kids, you would see more of a difference,” he said. The average immigrant arrives at age 30, and immigrant women have, on average, 2.1 children, according to the Pew Research Center.
Camarota added that immigrants tend to be poorer than native-born Americans and are therefore more reliant on a wide range of public services. “If you bring in a lot of immigrants who are paying into Social Security but then need all these other social programs — well, then you’re not helping the situation.”
Analysts on both sides agree that increasing the number of highly skilled immigrants would shore up the system more than the Social Security Administration report accounts for, since high-skilled immigrants pay more taxes and spend more than low-skilled ones. Lawmakers said last month that they are considering doubling the number of visas for highly skilled workers, to around 130,000 per year.
But many lower-skill jobs will also need filling as America ages, said Ai-jen Poo, director of the National Domestic Workers Alliance. For example, about 23 percent of caretakers for the growing ranks of the elderly are immigrants, mostly undocumented, she said. “We simply do not have the adult bodies to take care of the older adult population,” she said.
In addition, many elderly immigrants contribute indirectly to the economy without holding jobs that earn benefits, said Patience Lehrman, national director at Project Shine at Temple University, a program that helps older immigrants.
“A 75-year-old grandmother may not be able to work a 65-hour workweek, but by virtue of the fact that they can babysit the children of their child who is working full time, their child can participate in the GDP,” she said.
Many undocumented immigrants have been paying into the system for years. Since 1996, they have been able to file taxes using a government-issued individual taxpayer identification number; others use fake Social Security numbers. An estimated half to three-quarters of undocumented immigrants pay taxes, Sumption said.
But even if they are allowed to become legal residents and ultimately citizens, their years of taxpaying may not translate into retirement benefits they can use. To be eligible, a person must have paid into the system for at least 10 years, and it is not clear whether, under immigration reform, payment by once-undocumented workers would count retroactively toward Social Security.
If it doesn’t, those now nearing retirement age may have to start from scratch.
Washington Perez, 56, a native of Ecuador, worked in the District for 14 years without authorization before receiving legal permanent residency in 2011. He now works 65 hours a week at two jobs, both of which require physical labor, and he is not sure how much longer he can keep it up.
“It’s not fair for someone who has worked all those years to lose all the benefits that you’ve accumulated over all this time,” said Perez, pausing to chat in the back room of the thrift shop where he was hoisting heavy boxes of books and papers. “Why do they give you a taxpayer identification number if they’re not going to recognize it?”
If he has to start paying into the system from scratch, Perez could be working well into his 70s.
Even with a path to citizenship, it could still be a decade or more before those currently here illegally become legal residents and eligible for services.
Gerardo Flores, 48, worries that he and his wife, who sell Mexican food from a cart in Philadelphia, will never be able to stop working. An undocumented immigrant who has paid taxes since arriving in the late 1980s, he said glumly, “We will work until we die.”
With only a few more years of physical labor left in him, Marcelo said he dreams of becoming a U.S. citizen, running an import-export business and then retiring here. If a path to citizenship is offered, he may become eligible in time to receive Social Security. Otherwise, when he and his wife get too old for physical labor, they will return to Bolivia, where it is cheaper to live and he owns property.
“No way to stay here with no benefits,” Marcelo said.
But he added that he has a feeling immigration reform might change his fortunes.
“I feel happy, really,” he said with a small smile. “There’s something on the way, something is coming.”