The world’s new number 2 spot for migration: Germany

Step aside Canada and Australia, Germany is now the second most popular destination for migrants. The European economy that has managed to weather the global financial crisis rather well moved up from eighth in 2009 to second in 2012, according to the Organization for Economic Cooperation and Development.

The increase in migration to Germany by roughly one-third is due to the influx of people from central and eastern Europe. An aging population is leaving Germany with a shortage of workers at a time when the nation’s economy continues growing. The need for more labor, especially skilled labor, at a time when many European countries are still struggling six years after the 2008 financial crisis makes Germany an attractive destination.

The data is captured in a report from the Organization for Economic Cooperation and Development (OECD), from May. The 34 member countries that make up the OECD represent many of the world’s leading economies. The data shows that migration as a whole has risen from 75 million living in OECD countries in 2000 to 100 million by 2010. The rate of migration dipped after years of growth, but has held steady for the past few years.

Meanwhile, the US retains the title of leading recipient of migrants. There was a small decrease in the number of people going to the US (3%), but it alone received 10% of the total number of migrants for OECD countries.

The issue of migration was examined further by the OECD in an accompanying report titled Is migration good for the economy? It breaks down how migration impacts labor markets, public expenditures and economic growth. While not all is perfect, the report finds that there are many benefits to migration. For example, Belgium, France and Sweden could see a contribution of 0.5% of  GDP to their budgets, thanks to migrants.

Migration brings people who can contribute to both high-skill and low-skill sectors, in recipient countries. Both are beneficial for the countries while providing labor opportunities for the workers. Migration comes at a cost to countries, but they are able to recoup those costs through the taxes and other revenues.

“Measuring the impact of migration on the public purse is a complex task,” concludes study author Jean-Christophe Dumont, head of the OECD’s International Migration Division. ”Nevertheless, over the past 50 years migrants appear to have had a broadly neutral impact in OECD countries.”

The main divide is between migration for labor and for humanitarian reasons. Countries where most people are moving in for work tend to reap greater benefits. Those that play host to groups that entered for other reasons, especially places where populations stay for a long time, tend to fare a bit worse.

“Employment is the single most important determinant of migrants’ net fiscal contribution, particularly in countries with generous welfare states,” says the policy debate report.

The findings are bound to continue the debate over immigration policies in the European Union. The big wins by far-right political parties in the recent European parliamentary elections are in part a reflection of growing concerns about financial and migration policies in the region. The victory of Marine Le Pen’s  Eurosceptic party in France was as much of a blow to the future of the EU as it was for immigration. She and her supporters are in favor of rules that significantly restrict immigration to France.

Tom Murphy

June 2, 2014


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