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Impact of immigration


During an economic boom the need for immigrants seems evident enough. But what happens during a period of economic stagnation?

In fact studies show that immigration is still needed. You can see why this might be. Immigrants will still do work that others reject. Few redundant business managers or electricians or shop assistants are prepared to work as building labourers or street cleaners. Most would prefer to take unemployment benefit or even stop working altogether.

But does immigration harm the prospects of other workers doing similar jobs? In the USA many studies have compared 'immigrant cities', like New York or Los Angeles, with less popular destinations like Nashville or Pittsburgh. They have found that immigration had no significant effect. Other studies have measured the the impact, before and after, of a sudden influx of immigrants. One opportunity occurred in 1980 when the 'Mariel' flow from Cuba increased Miami's labour force by 7%. This seemed to have little effect on employment or wages for the local population. Although there have been fewer corresponding investigations in other countries, those in Australia, Canada, Germany and the UK have come to similar conclusions.

Since immigrants often work in the least stable and lowest-paid jobs they do however, typically have higher levels of unemployment than native workers. This may not be very significant. In the UK in 2001, for example, when the unemployment rate for the UK born was just under 5% it was 6% for the foreign born. But the contrast is often much greater elsewhere: in France where unemployment is around 11% it is over 30% for non-EU immigrants.

Employment agency in New York

Employment agency in New York. Redundant workers in rich countries will spend a long time searching for the right job.
Photo: Stan Wiechers