Economic Benefits of Immigration and how to Manage Flow of Migrants

Recent Developments in Europe

In recent months, the world has witnessed unprecedented flows of refugees and migrants from the conflict zones in the Middle East towards the West where these refugees plan to begin a new life in countries in Europe as well as the United States.

While there has been much opposition to the acceptance of refugees and migrants in Europe and the US, there have been others who have pointed to the immense benefits of migration especially when the West is aging and hence, needs steady supply of workers to power its growth in the coming decades.

On the other hand, there is the opposition to such uncontrolled migration which insists that accepting refugees and migrants would disturb the cultural and social fabric of their societies.

The Successive Waves of Migration

Indeed, ever since the end of the Second World War and the beginning of the second wave of migration that began slowly and accelerate to the third wave of migration from the East to the West from the 1970s and coinciding with the processes of globalization, Western countries have been debating the pros and cons of migration.

On the positive side, the West and the United States in particular has gained a lot because of migration as the countries that have welcomed economic migrants have transformed themselves into global innovation hubs as well as economic powerhouses.

Indeed, the United States is perhaps the only country in the world that has been built because of migration and it is rightly called “an immigrants dream” or a “melting pot” that draws in migrants from all over the world.

Pros of Migration

Further, the advocates of migration also point to the fact that immigration results in a steady supply of cheap labor on the lower end and a steady influx of professionals who can help the countries move up the value chain on the upper end of the economic pie.

They also point to the fact that migrants help the countries economically as the increase in the workforce especially when the countries are going through a demographic shift would help the economy in maintaining the balance between retiring workers and incoming workers into the workforce.

Indeed, perhaps the biggest advantage of migration for the west is that since the number of old and retiring workers is increasing, there needs to be a steady supply of workers to fill the dwindling number of workers. In this respect, it is the case that by ramping up supply of workers through migration, the demand for more workers can be met.

As economics teaches us, growing economies as well as developed economies need adequate workforces as well as labor pools to remain competitive and hence, migration does help the West in this respect.

Cons of Migration

Having said that, there are an equal number of opponents of migration who at times tend to play on the economic insecurities of laid and unemployed low wage workers as well as the cultural and the social in addition to the religious fears of the majority population.

Their contention is that migrants take away the jobs of the domestic workers and also do not assimilate into the mainstream thereby causing social unrest and tearing of the social fabric. Moreover, they also invoke what is known as the “sons of the soil” argument wherein they insist that jobs must first be filled with locals and then with foreigners.

An On Balance Assessment

As can be seen from the points made above, the topic of migration is indeed divisive and has led to sharp divergences as well as polarization in the West. However, without an objective assessment, one cannot take either side of the debate along emotional lines and hence, there needs to be an on balance assessment of the topic.

For instance, the Western countries must regulate migration by dividing the flow of migrants into economic and humanitarian migrants. The first category would mean that only those who can contribute to the economic growth and who would be productive as well as add value to the economy must be allowed in.

Economics and Humanitarian Impulses

Having said that, economics cannot be the sole criterion to evaluate and judge everything and hence, there must be allowance for migration on humanitarian grounds so that refugees from conflict zones and other places can indeed build a better life in the West. Even more, these refugees if treated properly and in turn, do their best to assimilate, can also contribute economically, and help the West reap the benefits of diversity.

Thus, what we have is a situation where the West must allow migration by taking into account the various aspects. As can be seen from the recent surge or even a mass migration into Europe, the European countries cannot simply close their eyes to the suffering of refugees and at the same time, must also safeguard their interests.

Conclusion: Taking Stock

Therefore, as some leaders have suggested, allowing genuine migrants as well as those on humanitarian grounds and at the same time, creating “buffer zones” in the neighboring countries of the conflict zones would be the best possible solution at this point given the various dynamics and the factors at work.

Before concluding this article, it must be noted that the migrants too have a responsibility and which is far greater than the responsibilities of their host countries in terms of contributing to the growth of their hosts as well as by assimilating themselves into the culture and not taking to crime or terrorism.


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Managerial Economics