Cost of migration: Do immigrants really hurt host countries?

Migration can actually make a country richer but an unregulated inflow of migrants in developed countries could undermine institutions that make a country ‘developed’ in the first place.

Migration is a burning political issue today, from North America to Europe, countries are working hard to keep migrants away from their borders. Some have a lengthy, exhausting selection process to decide who comes in their country while some are trying to build infamous walls to keep migrants at bay.

Many migrants take long, perilous journeys through oceans and walk thousands of kilometers to reach borders of rich countries but are often met with pessimism from authorities, and also from native citizens if they make it into the country.

Native citizens often associate migrants with the higher unemployment rates, burdened public services and some also see them as a risk to the culture and traditions of the host country. But do they really hurt the country they look up to?

What does the data say?

According to International Migrant Stock 2019, there are more than 272 million international migrants in the world today and the majority of them are motivated by the lack of economic opportunities back home.

Contrary to the popular belief, they make only 3.5 percent of the world’s population and contribute greatly to their host country as well as their home country when they send remittances.

Open borders could mean a 50-150 percent one-time boost in world GDP, according to a research paper called ‘Economics and Emigration: Trillion-Dollar Bills on the Sidewalk?’ by Michael Clemens from the Center for Global Development. Remittances also form a sizable part of the GDP of many developing countries.

Research also shows that migration only has a small impact on the unemployment rate among native citizens in countries like the UK.

Evidence also suggests that when migrants take low-paying entry-level jobs, it allows native workers to elevate to higher positions. The impact on average workers, however, may not always be positive. It depends on factors such as whether migrants want jobs that complement or substitute existing workers.

And this is where regulations should come in to ensure the welfare of native residents because a huge, unregulated inflow of only high-skilled migrants would mean more competition for natives in high-skilled jobs and lower average wages.

An unregulated inflow of migrants in developed countries would also undermine institutions that make a country ‘developed’ in the first place.

The Australian model

The Australian stance on migration proves that migration can be beneficial for economies. Although not perfect, Australia’s policies towards migrants are a lot more welcoming compared to countries like the US and UK.

According to official data, 7.3 million people out of Australia’s population of almost 25 million are foreign-born. The country’s economy is growing from the last 28 years without recession and economists argue that the record-breaking feat would not have been achievable if not for the surging immigration.

In the past few years, Australia has given more than double permanent work visas relative to the percentage of the total population compared to the United States. But it must be done in the right way or it might end up putting pressure on both the governments and the native citizens.

It is important for a country to analyze which industries need migrants, what skill-level do they require, how would it impact the native citizens, how many migrants should the invite and whether migrants would pay extra taxes.

Migrants help a country and the businesses in a lot of ways, they help make new trade connections and bring new innovations and ideas along with their culture. But natives often fear that the same could also hurt the cultures and traditions of the host country.

Migrants often cluster with communities they relate to and this can change some parts of the cities uncomfortably fast. For example, neighborhoods dominated by South Asian residents can be easily found in various big cities like Sydney, New Jersey, and even Amsterdam.

Governments should do more to make sure that migrants blend in, learn local languages and understand and respect their culture. Strong and fair policies are key to ensure that migrant inflow is controlled but at a pace that helps a country reap the economic benefits while also preserving the institutions that are the foundation of the country.

(Disclaimer: The opinions expressed are the personal views of the author. The facts and opinions appearing in the article do not reflect the views of Devdiscourse and Devdiscourse does not claim any responsibility for the same.)