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Immigrants Key to Labor Force Growth in U.S., Other Rich Countries
Press Release
Thursday, May 17, 2007

Immigrants Key to Labor Force Growth in U.S., Other Rich Countries

WASHINGTON -- Population and labor force growth in the United States in coming decades will depend on immigration rather than growth in the native-born population. This was a conclusion of top demographers at a conference co-sponsored this week by the Inter-American Development Bank and the Migration Policy Institute. 

The experts found that the situation is even more extreme for European and other industrialized countries, which will continue to see their populations decline. Of the top ten countries outside of Latin America and the Caribbean that are destinations for migrants from the region, only the United States does not face declining populations and labor forces in the near future.  The United States is the exception in large part because of its current high immigration levels.

Donald F. Terry, manager of the IDB’s Multilateral Investment Fund, opened the conference by saying "As long as huge disparities in wages and employment opportunities persist between countries and regions, people will continue to have powerful incentives to move to wherever jobs are found. And what demographers are telling us is that, given current population trends, most future growth of the labor force in industrialized countries is likely to come from immigration."

Jeffrey Passel, senior demographer at the Pew Hispanic Center, presented extensive data to illustrate that point for the United States. “Basically, the U.S. labor force would stop growing without immigration,” he said. 

Passel showed that the robust demographics of the United States are due in large part to the 17 million immigrants from Latin America and the Caribbean that have been added to the U.S. population in the last 30 years. From now on, he noted, 65 percent of the U.S. population growth and virtually 100 percent of its labor force growth will come from immigration.

Joseph Chamie, director of research at the Center for Migration Studies in New York, demonstrated that immigrants are replacing some retiring workers in the major industrialized countries.

“Replacement migration can help maintain the size of the population and the labor force.”  But, he added, “Replacement migration cannot stop population aging.”  He noted that while industrialized countries may look at aging populations as a problem, they are actually the results of tremendous success: longer life expectancies and the ability of families to control the number and spacing of their children.  

Hania Zlotnik, director of the United Nations’ Population Division, pointed out the dramatic changes in the age structures of major immigrant-receiving countries as their birth rates have declined and their average life expectancy has risen. The results are aging societies with much lower ratios of workers to retired and elderly people. She noted that from the perspective of sending countries, the momentum of population growth in Latin America, Africa and Asia is so strong that they can continue to provide immigrants to industrialized countries without experiencing a population decline themselves.

One of the most unmistakable benefits of migration for sending countries is the flow of money that migrants send home to their relatives -- over $60 billion to Latin America and the Caribbean in 2006.

Manuel Orozco, director of Remittances and Development at the Interamerican Dialogue, a Washington-based think tank, emphasized that continuity in remittance flows depends not only on the demand for immigrant labor but also on the characteristics of immigrants. 

“Demographic characteristics such as age, gender and length of time in the destination country influence remittance transfers,” he said.  “Economic conditions in the home countries and the expectations about migration among those in the younger generations also have an impact on the future of remittance flows.”

Demetrios Papademetriou, president of the Migration Policy Institute, wrapped up the panel by discussing how immigration policy interacts with demographic realities. “Although demography is not destiny,” he said, “no country can afford to ignore the labor market consequences of a fast-aging society. The immigration system can be a useful instrument in efforts to respond to these real concerns.”


This panel discussion is part of an MPI series of events and publications in preparation for the Global Forum on Migration and Development to be held in Brussels in July 2007.  For more information and to sign up for updates on upcoming events and publications, please visit https://www.migrationpolicy.org/.

The IDB’s Multilateral Investment Fund has a Web site on remittances to Latin America and the Caribbean with maps, estimates and studies on the money sent by migrant workers to their home countries.