Large Scale Immigration From Poor Countries Is An Economic Weight For Europe Unskilled immigrants cannot contribute to enterprise and economic growth. At best they compete for low skills jobs

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WASHINGTON – The headlines about illegal immigration into the European Union these days are mostly about the ordeals and unfortunately tragic deaths of would-be migrants, in African deserts or at sea, trying to cross the Mediterranean from Africa to Italy.

Human tragedies

Most recently Pope Francis scolded European governments for doing too little to prevent these frequent human tragedies, while treating poorly the migrants who actually manage to land on European shores.

(This humanitarian approach implies that these semi-desperate individuals have a “right” to immigrate illegally; it also implies that Europe has a duty to welcome them and give them whatever aid is necessary to start a new life in a better world).

Perilous journeys

Yes, there are daily tragedies. We know the sad tales of gullible or desperate people from sub-Saharan Africa who pay small fortunes to buy safe passage into Europe and never make it. Many are cheated by traffickers who steal their money, exploit women and sell children into slavery.

Some die during dangerous trips across the Sahara Desert, way before they could reach the coast of Libya or any other North African country from which they hoped to sail to Europe. Many others die at sea. Overloaded old boats trying to reach the Island of Lampedusa, off the southern coast of Sicily, sometimes capsize. Scores, sometimes hundreds of people drown.

And the lucky ones, those who get to the “safety” of the Italian or Spanish mainland face long ordeals before they can get permission to settle somewhere within the European Union.

Europe cannot handle this wave

Yes, all this is very sad. Europe is simply not equipped to handle this slow-moving, but steady human wave of illegal immigrants seeking a new life away from African poverty or Middle Eastern conflicts.

However, beyond the debates on what a Europe-wide immigration policy should be, and what should be done to improve the capacity of coast guards, immigration offices and provisional accommodations for immigrants, it is important to focus on the long-term economic consequences of this never-ending human wave from poor countries.

Indeed, the real problem caused by this wave of immigration into  relatively better off Europe is the negative economic impact of massive, unskilled immigration on the economies of the European countries in which these immigrants settle.

Impact on already weak European economies

Let’s step back for a moment and consider the broader picture. Europe is of course part of the modern, developed “first world”, and this is the main reason why poor people from Africa want to go there.

True. But it is also true that most of Europe is stagnating. Even before the devastating impact of the global 2008 recession, Europe was not growing much. Now it has simply gotten worse. Italy’s GDP is unchanged since the year 2000. This means net zero growth for 14 years. Not to mention the deep economic damages in Greece, Spain and to a lesser extent Portugal. Even France, the EU second largest economy, is doing rather poorly.

Population decline

Now, add to this downward economic trend another one, equally worrisome: slow but steady population decline. Yes, in most European countries there are negative fertility rates. When women, on average, have fewer than two children, the population starts shrinking. The lower the fertility rate, the more rapid the population decline. And since most Europeans, thanks to improved medical care, live longer, the net result is slowly shrinking populations with a larger percentage of old people. And seniors consume (rather than produce) capital resources. They do not work, while they receive pensions, free health care and other (costly) economic benefits.

Well, with the exception of France –a country that actively subsidizes larger families– most European countries are experiencing low or very low fertility rates. Wealthy Germany is at 1.43 children per woman. Poorer Italy is at 1.42. Vibrant Poland is at 1.33, much worse off Romania is at 1.32. Badly damaged Greece is at 1.41. Better off Austria is at 1.43.

As you can see, rich and poor alike, most European states are experiencing low fertility rates that inevitably lead to an older population and inevitably to a shrinking economic base. Indeed, most pensioners do not start new enterprises based on game changing technologies.

Add low skills immigrants to the mix

Well, if you throw into this mix of low growth and stagnation coupled with shrinking and older populations a large number of mostly uneducated newcomers –the immigrants from Africa and the Middle East– what is the most immediate economic impact? A lowering of average skills.

This shift is extremely important. In modern knowledge economies, future growth is mostly about the quality of human capital. Indeed, human capital is the most basic foundation of future wealth creation. In order to start the companies of the future, societies need to produce a fairly large pool of well-educated scientists, engineers and would-be entrepreneurs. These are the people who have the ability and the will to break new ground, this way opening up new economic sectors.

Sadly, uneducated and unskilled immigrants do not add to the aggregate value of human capital. Illiterate people cannot be employed by high-tech companies, let alone have the ability to start new ones.

New comers to not add to the stock of human capital

So, here is the picture. The native and supposedly better educated European population is getting smaller and older. The only net numeric additions are represented by low skills or no skills newcomers. Even assuming adequate resources and focused efforts to educate the immigrants, it would take at least a generation to get the newly arrived up to speed.

But this is not going to happen. The newcomers are behind, and (for the most part) they stay behind. The evidence is that millions of mostly illiterate immigrants cannot be easily assimilated. There are language barriers, cultural barriers and religious barriers that prevent or at least slow down their integration into European societies.

No economic benefits for Europe

In conclusion, here is the grim picture. Most of the illegal immigrants, asylum seekers and assorted other newcomers get to Europe hoping to find a better future. For many of them whatever they find in Europe may still be better than the horrible conditions they left behind.

Still, their ability to quickly integrate into their adoptive countries is modest. As a result, most immigrants live somewhat marginalized. The lucky ones find menial jobs. Very few have the opportunity to find, let alone climb the socio-economic ladder.

The net result is that Europe does not benefit economically from these new immigrants. True, their arrival may contribute to counter the net population loss due to the low birth rate among native Europeans.

But these immigrants do little to increase the size and quality of the  economies of the countries that willingly or reluctantly welcomed them.

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