How California Immigrants Help Build the Economy

California’s economy is the 5th largest in the world, and the state’s immigrants are having a major impact on its growth. While most foreign-born residents come to California from Central America, South America, Asia, or the Pacific Islands, African and Middle Eastern populations are also well represented in the state. In 2021, immigrants comprised 27% of the state’s total population. They made up 33% of all workers in the state’s labor force and 38.9% of its entrepreneurs, contributed $51.4 billion in state and local tax revenue, and had spending power totaling $354 billion.

Entrepreneurship and Small Business

In 2021, 38.9% of entrepreneurs were immigrants to California. They founded everything from small groceries and nail salons to tech startups and created thousands of jobs. Immigrants also founded or co-founded eleven California-based tech firms, including Google and eBay, that became Fortune 500 companies. Firms with at least one foreign-born owner provided work to nearly 1.5 million Californians and generated $20.2 billion in income in 2014.

STEM Industry and Startups

STEM (science, technology, engineering, and math) jobs are key to U.S. economic growth, and in 2014, California immigrants made up 39.8% of the workforce in fields like computer programming and biotechnology. 56.5% of applications and systems software developers are foreign-born workers.

California is also known for its high-tech Silicon Valley startups, and from 1995 to 2005, the share of immigrant-founded tech firms reached 52.4%. Foreign graduates who receive STEM training at the masters or Ph.D. level from a U.S. school are also known to start firms of their own or take high-level positions that drive job growth for native-born U.S. workers.


California produces one third of the nation’s vegetables and two thirds of the nation’s fruits. California’s leading agricultural exports include tree nuts like almonds and fruits like tomatoes, grapes, and strawberries. This industry relies heavily on immigrant workers. The majority of these workers come from Mexico and many are undocumented. The majority of these workers reside in the Central Valley region.

Labor Force

Working-aged immigrants make up nearly a third of California’s workforce, and many are employed in labor-intensive positions such as housekeeping, landscaping, and garment industry work. More than 60% of California’s landscaping workers and 78% of cut-and-sew apparel workers are immigrants. Foreign-born workers also make up over 45% of employed health aides and more than 60% of laborers employed as housekeepers, maids, and other domestic workers in private households. They also dominate many businesses that provide cosmetic services; more than 84% of nail technicians are immigrants. In Los Angeles, Mexican immigrants occupy a variety of jobs in health care, construction, retail and service industries.

Tax Contributions and Spending Power

In California, immigrant households earn hundreds of billions of dollars  every year, totaling nearly 30% of all state-earned income. California’s immigrants contribute more than 25% of state and local tax revenues, which support schools, police forces, and other public services such as Medicare.

The money California’s immigrants earned in 2021 contributed heavily to their $351.7 billion in spending power. Immigrants frequently spent cash at local businesses like salons and restaurants, which helped promote job creation and maintain economic health in their neighborhoods.

California’s Immigrants are Vital Contributors to the State’s Economic Prosperity

California’s immigrants are entrepreneurs, workers, business leaders, taxpayers, and devoted community members who make important contributions to the state’s thriving economy. Their diverse range of talents benefits everyone and will continue to bring wealth to the state for years to come.

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