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15 November 2024

Record Migration Drives Economic Gains And Political Backlash

OECD reports sharp increases as nations grapple with migration's impacts amid rising public concern

2023 marked a noteworthy chapter for global migration, as legal migration to the world's wealthiest nations surged to unprecedented heights. Outpacing prior records, this influx included approximately 6.5 million individuals settling within the 38 member states of the Organisation for Economic Co-operation and Development (OECD). This 10% rise over the 2022 record of 6 million reflects increasing demand for foreign labor and international students.

The United Kingdom, now standing as the second-largest recipient of migrants after the United States, experienced the most significant leap, welcoming around 750,000 new immigrants. A sizable share of this increase stemmed from recruitment efforts particularly focused on the care sector, highlighting both labor shortages and the pivotal role of migrant workers in sustaining economic activities.

According to Jean-Christophe Dumont, head of the OECD's migration division, the migration flow isn't merely reflective of recoveries from past disruptions related to the pandemic. Instead, it signals what Dumont identifies as “a new trend” influenced by persistent demand for workers and unparalleled opportunities for students globally.

Notably, the US absorbed 1.2 million legal migrants, the highest figure among OECD countries, bolstering its role as the leading destination for those seeking new opportunities. Economists point to this as integral for reigniting growth across major economies muddled by inflationary pressures and post-pandemic recovery tasks.

While overall immigration rates rose, the pressure from irregular migration, particularly concerning the increasing number of asylum seekers, has drawn public concern and led to governmental pushback. Recent reports indicate asylum applications within OECD countries surged by 30%, reaching 2.7 million, propelled chiefly by heightened arrivals from conflict-ridden nations like Venezuela, Colombia, Nicaragua, and Haiti. For example, the US itself received more than 1 million asylum claims, surpassing the combined totals from all European OECD nations.

This spike has not gone unnoticed, as several incumbent governments faced growing voter apprehension over migration policies. Countries such as Canada, Australia, and the UK began tightening their immigration regulations, implementing various caps on the flow of temporary residents and reassessing their approaches toward international students. These regulatory changes are largely viewed as responses to public sentiment, reflecting anxieties surrounding housing shortages and job availability.

Reflecting on the UK’s situation, political observers note the challenges brought forth by Brexit, which had leaders promising reductions in immigration rates. Yet, recent statistics tell another story, indicating continual immigration exceeding pre-COVID and pre-Brexit norms. The OECD's analysis highlighted this paradox, as the UK's population grew by 750,000, marking substantial discontent among constituents who expected stricter control over immigration.

Mark English, of the European Movement UK, criticized the notion purporting Brexit would naturally curtail immigration, calling it “a fantasy.” He elaborated on how labor market dynamics would dictate migration flow trends, emphasizing the necessity for foreign workers across sectors, especially healthcare.

Presently, the UK Prime Minister, Keir Starmer, has committed his government to reducing what is perceived as “sky-high” immigration levels. Starmer mentioned the potential to train domestic workers to lessen the country's economical dependence on overseas labor. This political stance, particularly as the country navigates substantial fluctuations within its labor market, reflects an attempt to appease both economic needs and public concerns.

Indeed, economists highlight the intricacies of how immigration interplays with economic dynamics. For countries like Canada, Germany, New Zealand, and the UK, immigration has significantly bolstered employment figures post-2023, actively aiding labor market recalibrations.

Despite these economic gains, the rising tide of irregular migration has led to political ramifications, evidenced by national elections where the immigration debate played central roles. The OECD underscored how all nations facing re-election experienced declines in voter support, linking these trends to broader immigration experiences.

Attention also zeroes in on the demographic challenges more affluent countries are inheriting, labeled as aging populations, which inherently impact labor supply. Dumont reiterated the dire need for continued legal migration to offset these demographic shifts and their economic consequences, particularly within agricultural, hospitality, and healthcare sectors.

The intensifying focus on immigration policy reform signals actionable responses from the governing bodies of OECD nations, reframing the narrative surrounding migration and its role within the globalized economy. Each country's unique political and social landscapes will likely navigate these waters differently, prompting varied but decisive actions aimed at meeting both public demand and economic realities.

With this migration narrative continuing to evolve, attention will remain on how governments manage this duality: leveraging the economic benefits of migration against the backdrop of public opinion and political ramifications.

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