By Abhirup Bhunia

Legislators across the developed world are hurriedly stringing together laws to tighten control on borders to prevent escalating immigration, an international phenomenon that is only to be anticipated in a world that refuses to retreat from the globalization fiesta. Antipathy towards immigrants is a shared trait among the far right parties of Europe, America and Australia. But cutting back global migration is tantamount to shortsightedness. The future in respect of migration is anybody’s guess, but it is certainly reckless to overlook the mutual benefits that liberalized borders accrue to humanity. 

Much like the biological process of osmosis, migration too dramatically changes the ecosystems of both the receiving and sending countries/regions. As regards migration, there is an unmistakable categorization for sending and receiving nations, based on certain traits. ‘Receiver’ countries are comprehensively developed and modern, whereas ‘sender’ countries are typically poor, underdeveloped and backward. That explains why the United States, going by 2010 figures, is the largest receiver country in the world with 42.8 million migrants.

Neoclassical analyses propose that it is the employees who contend with problems in receiver countries while their employers are at an advantage, and vice versa. Due to an influx of workers, natives in the receiver countries deal with stiffer competition, more so since immigrants are usually contented with an income lower than what locals are given to demand for the same work. Employers in the sending countries are at a disadvantage as a shirking labor force pushes up labor costs. Although this can be deemed simplistic, it is a widely accepted theory and forms the basis of further scrutiny.

With that said, let’s now build the case for continued global migration and take a look at the multilateral advantages.

Owing to immigration, associated (auxiliary) classes of personnel can benefit. For example, an influx of Philippine nurses in the United States can lower remuneration of nurses in US due to greater supply of the semi-skilled workers. Again, with an input cost on the decrease, overall healthcare can be rendered less costly. This will undeniably give rise to higher demand for medical services, thereby financially benefiting healthcare as a sector, and eventually facilitating US medical doctors.

The richer Western countries, now desperate to restrain immigration to cater to the domestic political prospects, benefit vastly from immigration. The United States, for example, counts on immigrants to pick fruits & vegetables and perform related farm work. These services are doled out for a pittance, but nonetheless add up to quite a sum (considering the total number of émigrés) while profiting the American economy. Quite naturally, the wage received by immigrant unskilled workers is spent on daily needs and typically benefits a substandard sagging segment of the market (as immigrants cannot afford better quality goods). In any case, more money is circulated in the economy. Also, immigrants are given to pay more to the insurances and other security funds than they are prone to claiming. Immigrants in Canada working in farms are a fitting example. Thus the immigrants’ contribution in buttressing the social security net in Europe is a crucial factor. Migrants do not generally claim benefits but, as it happens, always contribute to the social fund, which in turn is invested for public purposes, thereby assisting the economy of the receiver country. Let alone Angela Merkel’s swipe at immigrants, Germany, like many other developed nations, also gains from immigration.

It is entirely true that an influx of relatively cheap highly skilled labor can finish with harsh consequences for the domestic workers who are at par, but there is a flip side to it as well. As pointed out earlier, since entitlements are generally not availed by immigrants, their income taxation and contribution to federal funds can boost the state coffers. The government can then go on to invest more in promising industries, thus creating a fresh round of jobs, for the taking.

Migration, principally from a developing to a developed country, has another crucial aspect to it – remittances. According to estimates, including World Bank studies, $316 billion were sent as remittances to developing countries in 2009. That is no trivial sum. Remittances are playing a part progressively more on par with and at times greater than FII (Foreign Institutional Investors) or FDI (Foreign Direct Investments) since foreign portfolio investments are accompanied by volatility as they are meant for short term gains, unlike remittances that are stable and long term with no profit motives. Developing nations now know a lot more on how to make sagacious use of remittances, thanks to easy accessibility of information. Remittance money can contribute to the liquidity of a region and encourage investment. With more purchasing power in the hands of hitherto destitute people, spending is also poised to get a boost resulting in enthusiasm in the local financial system. The economy of Siwan, a district of the East Indian state of Bihar, practically runs on remittances from migrants in Gulf countries who work as masons, carpenters and iron-fitters. Bihar receives more than $250 million every year through funds transmittal from the Gulf countries.

The facilitation of world economic balance made possible by global migration, thanks to liberalization, is often refused its due share of glory.

With a considerable part of the developed world facing ageing population (and thus a smaller workforce, lesser tax collections, etc), the need for young immigrant workers to support their economies cannot be understated. It may also be recalled that human capital in the end is just another form of investment. In purely commercial terms, individuals are embodied investments. Young educated migrants that drift to the West from their poor homelands are what they are, after having utilized their home economy fully (public schooling, government medical care, state owned higher education, etc) – before they leave country. Upon emigration, their mental and physical labour comes to the aid of the receiver country, and a part of their salary, as tax, adds up to the federal revenue collections of that country. Thus, while the outlay on the immigrant (made since birth till the time he emigrates) gets undone a windfall investment is made on foreign soil.  

Therefore, drastically cutting back on migration will hamper the balance created so far. Migration is essentially a two-way street. Several lots of people can escape poverty by migrating to places offering jobs and better utilization capacity. At the same time, remittance money can literally develop entire regions. Migration from emerging economies also makes up for a shrinking young workforce in Western nations. Immigrants also bolster the social security net in the West.

And, since jobs shift to low income places and individuals shift to high-income places, the mutual exchange will eventually generate equilibrium. Strategically handing out fewer visas will only complicate matters.