Economics of Labor Immigration - Essay Example

? Economics of Labor Immigration Economics of Labor Immigration Considering the impacting changes in the economic profile of the developed countries and the challenges facing the conservative business models, the need for luring the innovative thoughts is of prime requirement now. In addition, the recovery of an economy that had undergone severe financial crises and a series of corporate failures has to be backed up by uninterrupted supply of potential human capital. It seems that industrially developed countries largely depend on immigrants to meet their workforce needs. However, many people argue that growing immigrant population steals a notable percent of Americans’ jobs and this situation would adversely affect the overall economic development of the country. This paper will analyze how immigration influences the factors contributing to economic growth. In order to obtain a clear view of the immigration influences on economic development, it is necessary to have a look at the factors causing economic growth. First, skilled and qualified workforce is a major factor influencing the economic growth of a country. A potential workforce can demonstrate improved productivity, which in turn is an element capable of increasing the volume of GDP. In other words, a skilled workforce can significantly improve overall economic performance of the country. Second, age of the population is a factor affecting economic growth. As authors like Harry Dent point out (as cited in Floum, 2009), number of people who are in their peak spending years represents one of the key drivers of a country’s economic growth. Third, technology extremely affects the economic growth rate of a nation because this element assists companies to minimize their labor and other operating costs and thereby to increase net profitability. In the modern business era, innovation is an integral factor contributing to a nation’s economic growth. Today companies consider innovation as a key tool to enhance their brand loyalty and to improve market competitiveness. Referring to economic models and empirical evidences, it seems that immigration can influence all these drivers of economic growth. It is clear that the demand for skilled labor is very high in industrially and economically developed countries like United States. Evidently, those countries do not have enough skilled workforces to meet their labor needs and therefore they are compelled to depend on skilled immigrant workers. Hence, immigration greatly assists a developed/developing economy to meet its growing demand for labor in different sectors. As Kenny (2012) reports, immigration significantly contributes to the sustainability of Americans’ quality of life, which is a direct indicator of a nation’s economic development. The author strongly argues that immigration notably benefits the US to obtain a skilled group of workers from overseas countries. To justify his views, Kenny refers to a study conducted by Patricia Cortes and Jessica Pan. This study reports that the percent of foreign-educated nurses who attend the US licensure exam increased from 6% in the mid-1980s to over 20% in current days. The study also indicates that nurses who were educated in Philippines earn nearly 4% more than the average nursing wage due to their high quality work. In short, many vacancies for qualified and skilled workers in US would be left unfilled if the Federal government adopts a hostile approach towards immigration. Similarly, an aging population in the United States and Europe is likely to impede their growth rate because old people are less productive. Evidently, an elderly individual cannot complete his job task as fast and efficiently as one of his young colleagues does. Hence, an aging workforce would negatively impact organizational productivity and ultimately a nation’s economic performance. However, immigration can better address this issue because there are millions of qualified immigrant workers searching for employment. Kenny (2012) points out that United States’ fertility rate has declined as a result of the global financial crisis and the current rate is below two children born per woman. Referring to an analysis by Moshe et al, Kenny reflects that “an important reason for historically large families in the US was cheap child care, much of it provided by undocumented workers” (Kenny, 2012). Therefore, if the low-skilled migration is restricted, the fertility rate would remain low and this situation in turn would affect the workforce needs of the nation. Hence, good immigration flow is necessary to improve US fertility rate and hence to contribute to the country’s human capital strength. Finally, immigration can noticeably contribute to technology and innovation. Students from all across the globe are studying in different US universities. If the Federal government creates adequate job opportunities for qualified foreign students within the country, they would not be employed by other overseas countries (PBS Learning Media). This strategy will definitely provide the US with an edge over other developed countries in terms of GDP growth. According to Wadhwa’s study of foreign-born entrepreneurs, “one-quarter of science and technology companies founded from 1995 to 2005 had a foreign-born lead technologist or chief economist” (as cited in Kenny, 2012). This finding directly indicates the fact that skilled immigrants play a vital role in promoting the growth of US technology sector. My uncle has been working for the General Motors in Californian plant for the last 5 years. His line manager is an Indian. In addition, he has many other Indian, Chinese, and Brazilian colleagues in the plant. Most of these foreign-born workers are highly qualified and skilled and they perform better than native workers. In addition, those immigrant workers are willing to undertake any difficult task and to take overtime work. Therefore, immigrant workers significantly contribute to the fast development of US economy. From the above discussion, it is clear that immigration can positively influence factors contributing to economic growth. Immigration is essential to meet the growing demand for labor in the United States. In addition, it is a better solution to the problem of an aging workforce population in the country. Employment of skilled immigrants is a recommendable strategy to boost the technological advancement of the US. In sum, it is advisable for the US Congressman to make necessary arrangements for liberalizing immigration laws in the nation. References Floum, a. (2009). Population age affects economic growth. Examinor.com. retrieved from http://www.examiner.com/article/population-age-affects-economic-growth Kenny, C. (2012). Why More Immigration, Not Less, Is Key to U.S. Economic Growth. Bloomberg Business week, Oct 28. Retrieved from http://www.businessweek.com/articles/2012-10-28/why-more-immigration-not-less-is-key-to-u-dot-s-dot-economic-growth#p1 PBS Learning Media. One View From Capitol Hill On Immigration. Retrieved from http://www.pbslearningmedia.org/resource/d0806610-6b24-492f-8934-a5c3640a7d93/d0806610-6b24-492f-8934-a5c3640a7d93/ Read More