Will economic migrants make or break Europe?


With waves of refugees continuing to arrive on the shores of European nations, a debate has raged about what kind of impact this mass-migration might have on Europe’s economies – and perhaps even more controversially, what kind of effect it might have on its cultures.

Of course, some Europeans – most notably, those in Sweden, Iceland and the Greek island of Kos – have been caring for refugees irrespective of the probable immediate economic burdens their compassion might have. Others have been more grounded, with the UK taking the arguably more pragmatic approach of taking in thousands of people previously housed in UN refugee camps on the Syrian border – even if it did take significant international pressure to reach such a concession.

Often the arguments around this huge movement of people seem to come down to a mixture of economic and political issues, with each nation having its own internal argument over how many migrants their economy and infrastructure can afford to support.

However, The Economist previously reported on a study in the OECD’s International Migration Outlook which found that the fiscal impact of migrations is broadly neutral, stating that migration is “neither a significant gain nor drain for the public purse”.

Existing research from the likes of Harvard University’s David Card and George J. Borjas and Universidad del Pais Vasco’s Sara de la Rica seems also to conclude that immigration’s impact on the wages and employment of native workers is either very small or non-existent.

Studies show that in some cases, those on middle-to-high incomes find that wages can in fact go up as a result of migrants with lower levels of education and experience displacing workers in manual jobs and the services sector. Although this may not mean a large change for a nation’s economy overall, it is likely to be a concern for domestic low-skilled workers who could find their wages increasingly put under pressure by new competition for jobs.

Germany’s government estimates a cost of 12,000 Euros per refugee per year and this has been a particular sticking point for many German voters. However, even these figures can be misleading. The extra-spending itself does not simply disappear into a black hole and in countries with quickly aging populations like Germany, this investment into young workers entering the country could pay dividends in the future.

Just as interesting as the economic argument is the discussion surrounding the effect migration has on Europe’s internal politics and on social cohesion within its member states. Already, across Europe, leaders have seen a push back against those who look favourably on opening the doors to large numbers of migrants.

Despite Germany being seen worldwide as one of the nations pushing for more work to be done, Chancellor Angela Merkel’s Christian Democratic Union party were dealt heavy blows this week in Germany’s regional elections supposedly as a result of the party’s position on migration. Large numbers of voters instead chose to back the far-right AfD – Alternative for Germany – party, who campaigned heavily on an anti-immigration ticket.

This growth of the far-right in Europe existed prior to the migrant crisis, with the rise of parties such as Latvia’s National Alliance, Hungary’s Jobbik and the National Front in France. However, these parties have campaigned with renewed vigour against migrants crossing borders in Europe, often highlighting a perceived danger of Islamic extremism and terrorism.

According to Dr Matthew Feldman, an expert in fascist ideology and the contemporary far-right in Europe and the USA, the influx of different cultures – and particularly Islam – into Europe has allowed groups to capitalise on existing prejudices and concerns and has led to a resurgence of populist far-right groups on the continent.

He said: “Some parties have policies in place and they have been able to say: ‘Look, what we’ve been telling you is right’ or argue that what’s happening validates their arguments about things like demographic change and in their view, the rise of things like extremist Islamism.

“One of the things that seem to be characteristic of these groups on the extreme-right is the recourse to scapegoating. I have no doubt that what we’re seeing in regards to anti-Muslim prejudice is a kind of anti-Semitism for the 21st Century.”

The rise of the far-right across Europe could be one of the biggest outcomes of the migrant crisis – and in turn be a huge headache for a European Union structured specifically to curb the rise of extremist parties. The mass influx of non-domestic cultures and workers into mainland Europe will likely mean an irreversible change in the culture and lifestyle of many member states.

While some of the short-term economic and political arguments seen in the media may well be reactionary, the biggest impact of migrants moving to Europe could well be how existing Europeans choose to respond to their arrival. Europe is a continent marked by centuries of migration and also political upheaval. This latest crisis could provide an opportunity to buck that trend and be the making of a union predicated on the values of human dignity and peace.


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