Migration fears - Myths and reality
Are immigrants bad for the economy? That depends on who you are
THERE are three big worries about the economic and fiscal consequences of immigration. First, migrants steal jobs. Second, they lower wages. Third, they are benefit-scroungers, generating a net burden on taxpayers. How justified are such fears?
The first is a myth. The accusation that migrants steal jobs is a version of the “lump of labour” fallacy—that there is only so much work to go around. But in a flexible economy the labour market adjusts to an increase in the supply of workers and more jobs are generated.
Research by Christian Dustmann, an economist at University College London, finds no evidence that previous migration flows in the 1980s and 1990s have taken jobs away from the existing population. What's more, today's labour market, with unemployment at a 28-year low and over half a million vacancies, is much tighter than in either of those periods.
Mr Dustmann's research also suggests that wages among existing workers have not been materially affected by immigrants; if anything they have risen...
...The third worry—that migrants are benefit-scroungers—is another myth. The vast majority come here to better their lot in the workplace. Unemployment rates among immigrants—except the Chinese or Indians—are higher than among people born in Britain, but this probably reflects difficulties in finding a job, such as poor language skills. Among those in work, immigrants are more likely to be self-employed than people born in Britain.
Nor are they a net burden on the taxpayer, according to a Home Office study which calculated that in 1999 existing migrants contributed £2.5 billion ($4 billion) more in taxes than they received in benefits and services like health and education. The NRC report, by contrast, suggests that immigration into America initially results in a net cost to the taxpayer partly because of the expense of educating immigrants' children. But in the longer term, it calculated that immigration will generate a substantial budgetary gain.
For immigration to be of mutual advantage, both migrants and the host country have to work hard. Migrants can generally be relied upon to do just that. They are motivated by a desire to get on—a further reason why employers rate them. But they can also do with some help, especially in learning languages, which greatly improves their chances in the labour market. Arguably, it is the host countries like Britain that need to work harder by helping more with such integration.