Pros and Cons of Immigration

 Immigration's benefits and drawbacks

Tejvan Pettinger on May 14, 2022

Significant economic benefits from immigration include a more flexible labour market, a larger pool of skills, more demand, and a wider range of innovative ideas. Immigration, however, is a contentious issue. Immigration, it is suggested, may lead to problems with crowding, congestion, and increased demand on public services. The dispute also centres on whether the influx of low-skilled immigrants affects native workers' earnings and even causes them to lose their jobs. Mostly, the economic costs and advantages of immigration are examined here.

Gains from Immigration

1. An improvement in living conditions and economic productivity. The size of the labour force will increase, as will the economy's productivity, as a result of net immigration. Immigration causes the economy to grow more quickly, which increases tax collections and opens the door to more government spending.

2. Potential business owners. It is argued that because immigrants frequently arrive with little money, they are more motivated to try to build a living for themselves. Additionally, those that are prepared to relocate and work for a foreign company tend to be the most ambitious and risk-takers, making them the more dynamic workers. Young, mobile immigrants are more likely to start enterprises that produce cutting-edge goods than other types of immigrants. 

The American economy is an illustration of how immigrants came to the country and established traditional American businesses, raising living standards and expanding the variety of goods and services available. For instance, Abdul Fattah Jandali, the father of (Apple) Steve Job, was originally from Syria. Scottish-born Alexander Graham Bell invented the telephone (AT&T). Amazon CEO Jeff Bezos is the son of a Cuban immigrant. Google's Sergey Brin is a Russian immigrant.

3. A rise in growth and demand. A common misconception about immigrants is that they "steal jobs from the native-born people." This is referred to as the lump of labour fallacy, though. the conviction that employment numbers are static. Contrary to popular belief, if immigrants migrate to the US or the UK and find work, they will spend their earnings there, stimulating the demand for goods and services. Immigrants do not 'take jobs,' but rather help increase GDP. 15 million immigrants entered the US between 1900 and 1915 (1), however this was a time of tremendous economic expansion and low unemployment. The rapid rate of expansion (in the United States between 1890 and 1910 - economic

4. More qualified labour force. Immigrants in the UK are more likely to have higher levels of education and professional training. For instance, just 20% of UK residents completed their schooling by age 21 or later. However, 53% of recent immigrants attended school until they were 21 or older. 2012 LSE study An economy can attract highly trained workers through immigration to fill open positions and increase tax receipts. 

5. Net gain for tax collections. Immigrants increase government revenue because they are more likely than native-born Americans to be youthful and employed. Workers who pay income tax do not receive advantages like pensions or educational opportunities. Compared to older persons, young people are less likely to use healthcare services. According to the UK government's HMRC, EEA citizens paid £15.5 billion more in income tax and national insurance in 2015/16 than they received in tax credits and child benefits (HMRC, 2018).

Recent EEA migrants had the largest fiscal advantage (+£4.7bn), non-EEA migrants had a little cost (£ -9.0), and people born in the UK had the largest net tax burden (-£41.0bn), according to Oxford Economics' 2018 analysis.

Evaluation - The nature of the immigrants does have an impact on migration. In the UK, non-EEA migrants have a higher fiscal cost since they have more elderly dependents who are eligible to immigrate for familial grounds (therefore negative tax impact). Various research on the financial effects of immigration are listed here.

6. Take care of the aging population. With an aging population and low birth rate contributing to an increase in the dependence ratio, many western economies are experiencing a demographic crisis (ratio of old to young workers). This puts strain on social services, tax collections, and public spending. The best strategy for dealing with an aging population is immigration, which enables gaps in health and social care to be filled by young employees who improve employment and make a net contribution to government coffers.

7. A more accommodating labour market. Immigrants move around a lot. When labour is in high demand and incomes are high, they relocate to those economies. This provides labour to satisfy the rising demand, preventing an expanding economy from overheating. Less visible is the reality that migratory flows frequently reverse during economic downturns, meaning people often leave to seek unemployment benefits and instead return home. Ireland is a good case in point. Before 2007, when the economy was booming, it drew numerous construction workers from the EU.

8. Eliminates a skills gap. It would take several years to train new workers in an economy where there is a lack of professional people like nurses and doctors. However, the health system cannot support this delay. Immigration makes it possible to fill the gap right away.

9. Filling unwelcome job openings. Due to poor pay or the prestige associated with a certain line of employment, it might be challenging for native-born workers to occupy some positions. For instance, farmers frequently hire foreign workers to harvest their crops. Farmers claimed they were unable to collect the harvest because they couldn't find seasonal labour in 2019 due to a reduction in immigration to the UK. Businesses and employers who rely on adaptable labour to fill open positions gain from immigration. Additionally, if immigrants take up low-skilled tasks, it frees up native-born workers to find better-skilled employment elsewhere.

10. A multiethnic society. Aside from economics, some believe that immigration increases cultural diversity, which makes a nation feel more inclusive and diversified. Every country that has seen immigration has incorporated a piece of foreign culture into its own, whether it is through food, music, literature, or political influences.