The ads and disads of immigration

Posted by Andrew Pegler on February 26, 2010

Hello UBankers (don’t read that aloud too fast as it may sound like an insult). This week I will continue this blog’s firm political stance on not having a firm political stance and take a gander at the ads and disads of the political football that is immigration. Tony kicks to Kev, Kev kicks to Tony…

Advantages of immigration:

1. We get more skilled workers in sectors that need them: Skilled migrant workers are often employed in important occupations that plug gaps in our national employment profile. Plus we didn’t have to pay to educate them. These sorts of professions include nurses, doctors for regional hospitals and more recently experts to service the mining boom.

2. We get more unskilled workers to do jobs we don’t want to do: On the flip side many migrants occupy low-skilled, low-paying jobs that Aussies don’t want to do. But it’s a win-win because the standard of living they enjoy here is often better than what was available to them before.

3. It slows the ageing population time bomb: As you would know the workforce is ageing. This ticking demographic time bomb is set to impact social security, health costs and other issues dramatically. But migrants and their kiddies tend to be younger than the natives so getting them in slows this down.

4. Better “vibes” dude: Sure it’s an esoteric concept and not one that belongs in an economics blog but a nation with a rich melting pot of cultures is better off in terms of music, food, clothing and art.

Disadvantages of immigration:

1. Threat of domestic terrorism: This is the political elephant in the room. Listen to the far right and this is a real and present threat; listen to the far left and the threat is minimal and can be contained. Either way this issue could turn the election. Just ask Tony Abbott, who last week announced immigration/terrorism as one of the big issues he wants to fight the federal election on.

2. Wage levels get pulled down: Migrants will often work for less than the natives, which can have the effect of pulling down wages especially in low-skilled jobs.

3. We end up educating more kids: Migrant families usually have more kids, which means more taxpayers’ money is needed to educate them.

4. Greater poverty: Because migrants often occupy low-paying jobs as a group they are more exposed to downturns in the economy like the GFC. This weakens the economy.

And in other news… over the past few weeks the acronym PIGS (Portugal, Ireland, Greece and Spain), representing the list of countries at risk of bankruptcy, has grown to PIGSJUKUS. JUKUS adds Japan, UK and US. FYI on a proper accounting basis PIGSJUKUS is already bankrupt, but technically they have avoided it because they can either print money or borrow more. Pork chops anyone?