Joe Biden to make fresh push on immigration reform, increase labour supply to lower inflation

US President Joe Biden (File image: Reuters)

US President Joe Biden is working to make a fresh push on immigration reform in the new year to lower inflation in the US. The Biden administration is looking for ways to provide legal status for 'Dreamers' and increase the labour supply, according to a report by Axios.

Biden’s political advisers are wary of the situation at the border as up to 14,000 migrants are expected to be crossing every day, which presents a humanitarian emergency for the US and the world.

Also Read: Immigration central: From EB-1 to EB-5 visa, 5 employment-based visa categories to work in the US

At the same time, top economic aides are concerned that the lack of immigrant workers is leading to labour shortages, which will continue to keep inflation high, according to the report.

DACA or Deferred Action for Children's Arrival was a federal government programme created in 2012 under Barack Obama to allow people brought to the US illegally as children the temporary right to live, study and work in America. Those protected under DACA are known as dreamers.

At 9.1 percent, US inflation soared to a record four-decade high in June 2022, mostly driven by gas, food, and rent prices. The US government blamed Russia’s invasion of Ukraine and the continuing disruption to global trade for the rising food and energy prices.

Inflation since then has cooled from its June high of 9.1 percent, with the consumer price index (CPI) at 7.1 percent in November. Job growth was robust, as employers adding 263,000 jobs last month.

However wage growth slowed down as the average hourly earnings for private-sector workers were up 0.6 percent in November, translating to a 5.8 percent annual rate over the past three months.

The US Federal Reserve on December 14 raised its benchmark interest rate to the highest level in 15 years. The rate-setting Federal Open Market Committee voted to raise the borrowing rate half a percentage point, taking it to a targeted range between 4.25 percent and 4.5 percent.

The increase broke a string of four straight three-quarter point hikes - the most aggressive policy moves since the early 1980s. The Fed has now hoisted rates seven times this year and signalled a few more hikes early next year.