Increasing Global Prosperity, labor shortage and Reviews to Immigration laws
This article explores the best strategies for increasing global prosperity by mitigating international labor shortages while imploring nations to scale down strict immigration laws to allow people to move across borders.
The UK government has published the Statement of Changes in Immigration Rules, which set out the legal framework for the new immigration system; this will apply to both EU/European Economic Area (EEA) and third-country applicants. Applications under the new system will open on December 1, 2020, for non-EEA nationals. EEA nationals will be eligible to apply under the new system from within the United Kingdom starting January 1, 2021. EEA nationals applying for entry clearance will be qualified beginning January 1, 2021. Irish nationals will not require a visa or permission to work. Mass immigration is not well received for most countries, especially by the resident population.
Misgivings exist within nations, primarily due to the surge in refugees due to wars and crises in Syria. Pundits have explored the long-term effects of migration on the advanced receiving economies’ GDP per capita and labor productivity.
The study by Jaumotte, Koloskova & Saxena (2017) on immigration and economic prosperity using a panel of 18 countries in focus indicates what to expect, and I agree. A Simple stratification of the demographics of migrants living in advanced economies suggests that migrants constitute 15–20% of the adult population and 30% in some Anglo-Saxon countries. Migrants accounted for 50% growth of the working-age population of most advanced countries between 1999 and 2015. If migration is not allowed within these developed countries anymore, the working-age population will decline rapidly in the next 15 years. The decline in the working-age group will primarily be due to population aging. The large numbers suggest that migrants substantially impact their host economies and will continue to do that even in the future.
Understanding the significant potential of immigrants to the growth of the advanced economy of the future was well received by the United Nations. Hence, they are solidly arguing that changes in immigration laws portend benefits and a viable solution. I support the free flow of immigration because it will facilitate the dual problems of explosive population expansion experience in less-developed countries and workers shortage that is primarily experienced in the industrialized world. The world’s most affected aging region is Europe, and the fast increasing retiree-to-worker ratio, expectedly the proportion of older persons will increase from 20% to 35% between 1998 to 2050. Spain has the highest share of older adults and is closely followed by Italy. The aging workforce might be the reason why Spain opened their borders to all South Americans of Spanish descent, working hard to keep the retiree-to-worker ratio from climbing higher. Immigrants are the determining factors for the increasing population in Europe, and they know that. Immigrants are having a significant impact on Europe’s population.
Increasing death rate and reducing birth rate, immigrants fill the gap
Even though more deaths than births across the European Union (EU), the population increased by 1.1 million in one year, to 512.6 million people. The increase was due to net migration. According to Eurostat, a world without migrants would have a significant impact on the working population of Europe
While their population is aging fast, Europe will need 1.4 billion immigrants between today and 2050, Japan and the United States will need another 600 million immigrants between now and 2050. However, if we cannot overcome cultural and political opposition, immigration cannot alleviate the fast declining population of most industrialized countries.
The analysis of the wonders of the “leave” vote of Brexit.
The United Kingdom voted 52% to leave the European Union on June 23, 2016, after joining more than 40 years ago. Exploration of the leave votes indicates that London, Scotland, and Northern voted to remain while the rest of England (outside London) and Wales voted to leave. The voice to stay came from predominantly younger and more educated voters. You will ask why Britain would want to go even though they are just 4% of the world economic production (Pugel, 2020) and hence economically better to stick with the EU. The EU is now more than 28 countries and coordinates across many economic, social, environmental, and security policy areas. The union eliminates tariffs on trade between EU member countries and imposes a standard set of tariffs on imports from countries outside. The EU represents a single market that promotes the movement of goods, services, financial capital, and people within themselves; they also have a common currency used by 19 EU member counties with a common monetary policy set by the European Central Bank. So would Britain want to leave? Even though the proponents of remain argue the dominance of London as Europe’s financial capital city. What about the free flow of products and immigrants? for manufactured products, one estimate that 44% of the Uk’s exports went to EU countries and another 16% to countries that have free trade agreements with the EU, 20% exports to the United States. So technically, the UK gained substantially by remaining part of the EU. Do you know what the problem is? Proponents of “remain” do not know how to pass their points across, lack narrative skills to picture their gains, and are not emotionally engaging. Hence, efforts promoting “remain was not well delivered.
The proponents of “leave” want Britain to set its own policies and listen to this!! They voted to “leave” the top reason was the desire to control and reduce net immigration. In fairness to the short-thinking strategy of the “leave” voters was the influx of immigrants to the EU in 2015, 330,000 people (including refugees) immigrated into Britain and other EU countries, and there were several shocking terrorist attacks. The broader argument of increasing overall economic benefits to Britain in the long term was ignored. Economists have argued that the UK leaving the EU remains a colossal mistake. Immigration is taking a hit right there.
Are immigrants bad to National economies?
Both legal and illegal, migration brings enormous gains to the global economic well-being. While this statement remains socially and politically controversial, we will see why and why it will blindly stay an argument for a long time.
Opponents of immigration argue that the range of problems that they believe it causes include general losses to the economy, the fiscal burden of use of government services such as health care and schooling, slow integration into national cultures, values, and language, increase in crime and links of some of the immigrants to terrorism. What can we make of these claims? In my opinion, funny and short-sighted!!. From the international economic standpoint accessing objectively, the harm done to a recipient country by new immigrants is essential here. The majority of new immigrants move to get a job as a first move and usually to get a pay higher than their home countries pay. Job-seeking immigrants bring net economic benefits not only to the immigrants but also to the receiving country. Fundamental analysis shows winners and losers within the immigrant-receiving countries. Winners are the companies that employ the immigrants and the consumers that buy goods and services that they help to produce (lower purchase price points on goods and services); the group that losses are the workers displaced by the influx of low-skilled workers from developing countries. Studies show only a limited effect of migration on the average wage and employment of native workers (Peri, 2014). Some studies show a negative impact on the wages of local workers(Borjas, 2003, Card, 2001). Other effects of migration include social tensions associated with migrants’ inability to socially integrate with the labor market and society due to cultural differences between their new and home countries. According to a survey in Europe by Card et al. 2012, personal concerns on the compositional effect of migration like language and culture matter more to people than economic concerns such as jobs.
Economists have put these together to conclude that the net effect for the receiving country is positive, indicating that the winners win more than the losers lose (Pugel, 2020). Finally, Aleksynska and Tritah (2015) found a positive effect of immigration (especially of prime-age immigrates)on income per capita and productivity of host countries at OECD countries.
It is difficult for countries to shoulder the associated short-term costs to foster the labor market integration of refugees and enjoy the long-term benefits of increased income levels and national prosperity. I stand with Jaumotte, Koloskova & Saxena (2017) to propose that countries help migrants integrate faster by inculcating language training, supportive job search leads, better recognition of their education and work experiences. Other needed support from host countries is to reduce barriers associated with entrepreneurial venturing. While these efforts require additional spending, they can ease new immigrants to obtain a job and increasingly contribute to fiscal accounts in the long-term increase in GDP per capita. Employed immigrants almost always support their families at home, thereby supporting their home country’s economy to increase the global flow of money and prosperity.
Final thoughts
Another strategy that may have tremendous policy implications is inculcating immigration education into the educational system in countries with personal concerns and misgivings about immigrants. Governments can use public enlightenment strategies. The current efforts by the developed countries’ governments are insufficient because the relationship between the ordinary person and the information they receive from the surrounding world is a severe problem. To build a bridge across a gap or to mediate between the “big world of global issues” and the little world of privacy, there ought to be a system of proper public enlightenment (Jacobsen, 1989). Like Mandelbaum inferred in his blockbuster book “The Road to Global prosperity,” globalization is irreversible and a positive force for both the United States and the world. As technology and free markets expand and national leaders realize that their political power is inclined to deliver prosperity, countries will cooperate more. As more countries connect, their economies will grow. As immigration increases and more money crosses borders, more countries will emerge from poverty; ultimately, individuals and societies worldwide will be the greatest beneficiaries. A prosperous world will be safer, easier to live in, and enjoyable for us all.
Resources sources.
Borjas, G J (2003) “The labor demand curve is downward sloping: Reexamining the impact of immigration on the labor market”, Quarterly Journal of Economics, 118(4): 1335–74.
Card, D (2001) “Immigrant inflows, native outflows, and the local market impacts of higher immigration”, Journal of Labor Economics, 19(1): 22–64.
Jacobsen, B. (1989). The concept and problem of public enlightenment. International Journal of Lifelong Education, 8(2), 127–137.
Jaumotte F., Koloskova K. & Saxena S. C.,(2017). Immigration and economic prosperity. Retrieved December 10, 2021 from https://voxeu.org/article/immigration-and-economic-prosperity
Mandelbaum, Michael. (2014). The road to global prosperity. New York :Simon & Schuster,
Peri, G (2014) “Do immigrant workers depress the wages of native workers?”, IZA World of Labor.
Pugel, T. A. (2020). International economics. McGraw-Hill