If you made to the end, well done! Sorry it ends a little abruptly, we ran out of video time on our camera….
Migration is increasingly seen as a high-priority public policy topic for governments and we believe at Exploring Happiness, rightly so. Migration can have a direct impact on economic prosperity, human development and safety and security within a country. As a result of the importance of this topic, it tends to receive a lot of media attention. Unfortunately, it is our view that the coverage of this topic tends to have an over-representative negative bias. This may partly reflect the changing nature of migration in some parts of the world. But as is the case with most news coverage nowadays, a greater emphasis is focused towards bad outcomes over good outcomes – it sells better and captures more attention.
Developing a better understanding of the impact of migration on wellbeing of both migrants and natives is a vital topic that should be debated and researched much more. This will allow policymakers to develop solutions to allow for greater human development through migration. The latest estimate from 2017 shows that 3.4% of the global population, or 257.7 million people, are international migrants around the world. A rise in the number of civil wars and conflicts has led to an increased amount of people becoming displaced, both within and across borders. 40.3 million people are categorised as displaced worldwide and 22.5 million as refugees, based on data from 2016. Within this context, policymakers should remember that migration corridors are not only shaped by economic and trade factors but also by conflict, smuggling, trafficking and insecurity.
Nevertheless, policymakers should also consider the economic benefits of migration too. Migration can allow for a greater spread of wealth and the increase in migration over the past two decades has shown this. It was estimated that in 1997 $77bn had been sent back to countries of origin in the form of remittances, whereas this figure has increased to $529bn, just 15 years later in 2012. Within the longer paper linked below we discuss the benefits and drawbacks of migration from a policymaker’s perspective and we summarise this below briefly:
Wages and remittances: generally, migrants often earn higher wages than they would have done in their origin countries. Migrants friends and family that stayed at home also benefit from their migration through remittances, which provides a stable source of income. Remittance inflows to developing economies have been steadily increasing to now become one of the most important sources of external finance for these countries. However, research has recently shown that remittances can cause countries to stagnate. An important reason for this is that increases in FDI are often associated with boosting productivity, whilst increasing remittances often feed through increased household consumption. Potentially, remittances can inhibit the motivation of workers and policymakers within their country to come up with innovative solutions that lead to progress.
Labour Market: evidence is increasingly showing that migration can benefit the country of origins labour market by reducing both unemployment and underemployment (that is, those that would like to work full-time that are currently working part-time or those working in a job below their qualification level).In terms of the benefits to the host country, this depends crucially on whether the skills of the migrant workers are complementary or substitutes to those of domestic workers.
Innovation and transfer of skills: by either nature or necessity, studies have found that migrants are often more likely to be risk takers, and this can lead to large contributions to destination countries – through innovation. Where there is good information available before the migrant takes the decision of where to move, this usually leads to a more informed decision and the migrant will move somewhere their skills are complementary. This leads to a good transfer of skills as the migrant worker has a positive impact on productivity within that country.
Fiscal Impact: the migration of young workers can help to ease pressures on pension systems of high-income countries with ageing populations. And in contrast to popular opinions, a recent study found that the net fiscal effects of immigration for most OECD countries is small and positive.
Social impact: potentially this is the most important area for discussion if we are looking at this topic from a perspective of the impact of migration on wellbeing. The main two areas are unsurprisingly: health and education. The findings from a World Bank study in 2016 are quite staggering in this aspect, “migrants from the poorest countries, on average, experienced a 15-fold increase in income, a doubling of school enrolment rates and a 16-fold reduction in child mortality after moving to a developed country”.
In the final section of the paper we discuss in depth the findings from the 2013 World Migration Report on migrant wellbeing and development. In our opinion it would be more beneficial to read the paper for this bit but we summarise the findings below for those in a hurry!
Migrants moving between two high income countries report the best impact on their wellbeing, across a range of dimensions including life satisfaction safety, community attachment and health. High to low income country migrants tend enjoy greater economic prowess but their social connections are often limited, and they are less likely to report that they have someone they can count on for help. On the flip side, low to high income migrants suffer from the economic differential and struggle to make the transition but on average they are better off for having migrated than those who stayed at home.