Migrants wanted!
When France takes over the rotating Presidency of the European Union in July, immigration policy will become a key agenda item. France's President Sarkozy and the European Commission are looking to find a functional way of managing labor migration to the European Union. New research, highlighted in Roland Berger Strategy Consultants' executive magazine, think:act, shows that EU and other Western countries need immigrants to counter the already apparent by the effects of demographic decline and economic slowdown.
What is India’s most important export by far? Is it perhaps innovative software solutions? Not in the least. Every year, $15 billion flow into the country through an entirely different export product: human labor. This is the amount of money that Indian expatriates working abroad send home annually. This makes migration a key economic factor for India. A connection that many developing nations around the world are discovering. For many, these money transfers represent one of the few dependable sources of income. Roberto Suro, head of the Pew Hispanic Center think tank in Washington, DC, explains: “Remittances have probably benefited Mexico more than membership in NAFTA.” Complaints about alleged brain drain are less common. Marcelo M. Suárez-Orozco, a professor at New York University, prefers to call it “brain circulation”: The knowledge isn’t lost forever. Migrants either return to their homeland eventually, or they pass their knowledge on to others. Mexico’s president Vicente Fox also supports migrant laborers moving North. His government is currently trying to persuade the United States to relax its immigration laws.
Migration - An economic advantage
Migrants also represent an important economic factor for developed economies. They contribute $50 billion annually to the gross national product in the US alone. In addition, immigrants cushion the effects of demographic change. The EU’s population rose in 2005 by over 2 million people to its current level of more than 808 million. Without net immigration, the populations of Germany, Greece, Italy and Sweden would have declined. In fact, immigration has been the main component in population change in the EU since 1989. In 2005, the net immigration rate was two per 1,000 residents, approximately 65% of total population growth. In addition, there is unregistered illegal immigration, particularly in southern member states. These new residents are especially attractive for countries and businesses because of their age demographics. Many of them are 20 to 29 years old. During the second half of the 90s, they represented 40% of all immigrants to the EU.
What is India’s most important export by far? Is it perhaps innovative software solutions? Not in the least. Every year, $15 billion flow into the country through an entirely different export product: human labor. This is the amount of money that Indian expatriates working abroad send home annually. This makes migration a key economic factor for India. A connection that many developing nations around the world are discovering. For many, these money transfers represent one of the few dependable sources of income. Roberto Suro, head of the Pew Hispanic Center think tank in Washington, DC, explains: “Remittances have probably benefited Mexico more than membership in NAFTA.” Complaints about alleged brain drain are less common. Marcelo M. Suárez-Orozco, a professor at New York University, prefers to call it “brain circulation”: The knowledge isn’t lost forever. Migrants either return to their homeland eventually, or they pass their knowledge on to others. Mexico’s president Vicente Fox also supports migrant laborers moving North. His government is currently trying to persuade the United States to relax its immigration laws.
Migration - An economic advantage
Migrants also represent an important economic factor for developed economies. They contribute $50 billion annually to the gross national product in the US alone. In addition, immigrants cushion the effects of demographic change. The EU’s population rose in 2005 by over 2 million people to its current level of more than 808 million. Without net immigration, the populations of Germany, Greece, Italy and Sweden would have declined. In fact, immigration has been the main component in population change in the EU since 1989. In 2005, the net immigration rate was two per 1,000 residents, approximately 65% of total population growth. In addition, there is unregistered illegal immigration, particularly in southern member states. These new residents are especially attractive for countries and businesses because of their age demographics. Many of them are 20 to 29 years old. During the second half of the 90s, they represented 40% of all immigrants to the EU.
Not only do these young wanderers enliven demographic statistics, they breathe life into labor markets. Some countries’ economies are already suffering from a shortage of skilled labor. By the end of this decade, the EU Commission expects a growing shortage of workers to affect a variety of industries in many countries. The EU Joint Employment Report 2003 predicts a dearth of high-tech experts—particularly in Sweden, Denmark, Germany, Ireland, the Netherlands and northern Italy. Experts describe the labor market in Finland, Ireland and the Netherlands as “very strained.”
The solution: Controlled, strategic immigration.
This is how Demetrios Papademetriou sees it. He is president of the Migration Policy Institute, a think tank in Washington, DC. He has been arguing the case for controlled immigration for years, particularly in the USA and the European Union.
And the local population? Contrary to popular opinion, immigrants are not driving down wages across the board. A current study by economists Gianmarco Ottaviano and Giovanni Peri shows that migration in the USA has actually had a positive net effect on wages for US citizens.
The solution: Controlled, strategic immigration.
This is how Demetrios Papademetriou sees it. He is president of the Migration Policy Institute, a think tank in Washington, DC. He has been arguing the case for controlled immigration for years, particularly in the USA and the European Union.
And the local population? Contrary to popular opinion, immigrants are not driving down wages across the board. A current study by economists Gianmarco Ottaviano and Giovanni Peri shows that migration in the USA has actually had a positive net effect on wages for US citizens.
About think:act
Roland Berger's executive magazine focuses on key international management issues and is published three times a year in German, English, Russian, Chinese and Polish. The magazine has won the international 'Best of Corporate Publishing' three years in a row, for its innovative approach. It also won honors in the B2B category at the 2007 Astrid Award for Design Communications in New York. More than 20,000 copies are distributed to international leaders in business, politics and media. The magazine is published in five languages: English, German, Polish, Russian and Chinese.
If you have questions or comments regarding this, or any other article, please do not hesitate to contact us:
Roland Berger's executive magazine focuses on key international management issues and is published three times a year in German, English, Russian, Chinese and Polish. The magazine has won the international 'Best of Corporate Publishing' three years in a row, for its innovative approach. It also won honors in the B2B category at the 2007 Astrid Award for Design Communications in New York. More than 20,000 copies are distributed to international leaders in business, politics and media. The magazine is published in five languages: English, German, Polish, Russian and Chinese.
If you have questions or comments regarding this, or any other article, please do not hesitate to contact us:
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