Studies say refugees help economy, drop the view they are an economic burden

Studies say refugees help economy, drop the view they are an economic burden

20 September 2015, 16:11
Alice F
2 853

According to the International Organization for Migration, already this year 362,000 illegal migrants have arrived in Europe and thousands continue to come. An estimated 80 per cent are refugees from violence, and Europe is legally obliged to provide an asylum for them.

Most European countries are reluctant to do that, and researchers explain it with two reasons: fear that letting in some refugees will encourage more, and that migrants will be an economic burden. However, the evidence shows both views are false.

EU asylum laws

The EU’s asylum laws were designed in the 1990s to accept small numbers of people. They don’t necessarily require people to stay in the first country they arrive at – where the fingerprints of refugees are held in the EU’s Eurodac database. But countries apply that rule, because it is an administratively easy way to grant refugee status. But a 2001 directive empowers the EU to bypass this system and admit asylum seekers quickly in cases of “mass influx”. In July, EU member states used it to agree a voluntary plan to relocate 32,000 people stranded in Italy and Greece, roughly according to the receiving country’s size, GDP, unemployment rate, and how many refugees it has already.

Apart from that, the EU has never used its emergency plan, says Madeline Garlick of Migration Policy Institute Europe, because “member states fear this will be a pull factor for other people from the same country”. Observers say this is why the UK refuses migrants who have already entered Europe – it would encourage more to come.

However, Alexander Betts, head of Refugee Studies Centre at the University of Oxford says that there is no sound research that would prove the political claim that giving people asylum stimulates more flow.

“Nearly all refugees want to go home. They don’t sit in refugee camps calculating where they can get the best benefits.”

Researches, economic impact

One EU country seems completely calm. Germany says it can take 800,000 asylum seekers in 2015, as it largely counts on immigrants to fill up its ageing workforce and the EU’s emergency asylum rules say resettled refugees can legally work. In 2012, Germany had 200,000 more deaths than births, - now more than compensated by 391,000 immigrants. 

“Every euro we spend on training migrants is a euro to avoid a shortage of skilled labor,” German state governments declared last week. Otherwise, they would need to spend more on benefits, as the labor shortage bites industry and jobs, they noted.

In contrast, UK prime minister David Cameron, being under public pressure, said the country would take solely 20,000 Syrian refugees by 2020.

On 4 September the World Bank, the UN’s International Labour Organization and the OECD issued a report which signaled that “in most countries migrants pay more in taxes and social contributions than they receive.”

In a research from last year, analysts at University College London found both European and non-European immigrants to Great Britain more than pay their way. Non-Europeans living in the UK since 1995 brought £35 billion worth of education with them. Those who arrived between 2000 and 2011 were less likely than native Britons to remain on state benefits, and no more likely to live in social housing. They contributed a net £5 billion in taxes during that period - unlike natives.

That is partly because most migrants are young and need relatively little in the way of benefits. Their economic impact is getting closer to the one natives have as they age and assimilate.

Carlos Vargas-Silva of the Migration Observatory at the University of Oxford reported this year that letting in 260,000 immigrants a year could halve the UK’s public debt 50 years from now.

Mathias Czaika of the International Migration Institute at the University of Oxford suggested that some studies show that migrants create jobs for locals. “An influx of migrants can depress wages, but mostly for other migrants, and only 1 to 3 per cent. Mostly the impact on wages or jobs is neutral or positive.”

Germany has no doubts. What is wrong with the others then?

Analysts distinguish non-economic reasons, viz, a fear of the cultural impact. In August, for example, Slovakia said it would take only Christian Syrians. Meanwhile more refugees are coming, and Europe will have to learn how to cope with this and make them adapt to the local environment - at least for now, until the situation is stable in their Motherland. Or maybe they have to skip their fears and look for economic benefits instead?

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