How immigration supports a country’s economy

Immigrants have been given a tag that negatively depicts who they are and fails to show the various benefits they bring to the countries they immigrate to. Before the eyes of many natives and on the backdrop of a sluggish economy, they are opportunists who are stealing their jobs.  On the contrary, however, research shows that having an inclusionary course and embracing immigrants boosts a country’s economic performance. In the UK for example, immigrants are twice as likely as British born individuals to start their own business. In the US, immigrants are two to three times more likely than US-born individuals to start a business. By increasing productivity, immigrants boost a country’s per capita gross domestic product.

Sluggish economic growth after the 2008 global financial crisis has seen a rise in populist nationalism in developed countries. Politicians are taking advantage of disappointing economic statistics and projections to paint a different picture that undermines the contributions immigrants have made to the various economies they have relocated to. A Citigroup report suggests that two-thirds of US growth since 2011 is directly attributed to migration. Also, more than half of US unicorns (startups valued at more than $1bn) were founded by immigrants, as were 40 percent of Fortune 500 companies.

While some developed countries are pursuing an exclusionary course, they are paying a hefty economic price. The Citigroup reports notes that if the UK had frozen immigration in 1990 so that the number of migrants remained constant, the economy would be at least 9 percent smaller than it is now. That is equivalent to a real loss in gross domestic product of more than £175bn over 15 years. While developed countries worry about the influx of immigrants, developing countries worry about brain drain. The number of well-trained individuals leaving their countries for greener pasture in developed countries denying their native countries the much needed human capital to solve some of their most pressing challenges resulting from emerging issues.

With populations aging and lower birth rates in advanced economies, immigration is now more necessary than ever. In 2018, Japan suffered its biggest population decline on record. According to the health and welfare ministry, the number of births fell to its lowest since the records began more than a century ago. The ministry had estimated 921,000 babies will have been born by the end of 2018. Combined with the estimated number of deaths – a postwar high of 1.37 million – the natural decline of Japans population by 448,000 was the biggest ever.

If existing research is anything to go by, cutting immigration is not the solution. This will widen the inequality gap and derail economic growth and development. Immigration benefits host countries since immigrants pay taxes. Immigrants also send money back to their relatives in their home countries. The funds received from abroad boost a country’s foreign reserve and also supports domestics investments.

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