© 2015 Prof. Farok J. Contractor, Rutgers University
Put aside, for the moment, the horrific scenes of human suffering, the fears that some ISIS sympathizers may be part of the herd swarming onto European shores, and the large immediate costs of resettling and giving aid to hundreds of thousands of souls. Then consider this question:
In the long term, does Europe benefit or lose?
Most of the migrants are young and will swell the labor force. From a simple Economics 101 point of view, yes—wages could drop very slightly as the supply of labor across Europe increases. But pictures on television and the media showing invading hordes miss the larger story:
1) The overall effect on Europe is slight because even 160,000 refugees (of which, say, half—80,000—could be added to the European workforce, the rest being children and homemakers) is a very tiny amount considering the total EU population of 508 million.
2) As in much of economics, the effects of any change are spread very unevenly. Germany will benefit as it needs workers and has full employment, while 25 percent of Greeks are out of a job. (But then, no migrants want to remain in Greece—they want to quickly move on and head toward the north.)
3) The fact is that some European countries, such as Germany and Sweden (certainly not all), are affected by internal population factors already:
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An aging (shrinking) population, with the labor force declining precipitously and fewer younger workers supporting pensions.[1]
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Jobs that are going begging—for example, the lack of skilled workers is a drag on Germany’s economy and exports.
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Youth unemployment below 6 percent in Germany, which is explained mainly by those between jobs or still in school—in terms of actual labor availability, the rate is effectively near zero.
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The need to inject youth and vitality into their culture as well as into their consumer base.
4) Another background consideration is that those who are migrating are not all fleeing war or problems. One sees faces in the crowds from Bangladesh, Nepal, and Afghanistan, where life is tough, but there is no open warfare, as in Syria. And almost all the migrants flooding into Europe are
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Literate, or in many cases relatively well educated
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Enterprising
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Resourceful
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Persistent
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Physically strong
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Skilled
In other words, these refugees are just the kinds of people a labor-short country wishes to induct into its society. Before 2013, long before the current influx, demographic data indicated that the mean age of immigrants into the EU was already below 25. (See Figure 1.)
Figure 1: The average age of immigrants in the EU is below 25.
Source: eurostat – Statistics Explained
Germans may be compassionate and caring toward refugees; but they are also calculating and smart about their own needs. So from a cold-blooded economics perspective, some countries, like Germany, will benefit considerably from the influx. And in Europe overall, the short-term costs of resettling refugees will be more than compensated for by the value of labor, talent, and ideas contributed by the (mostly young) migrants over the rest of their lives working in the EU.
But this net benefit is also a function of how well the new arrivals are integrated into each society as productive members. Germany and the Scandinavian nations do this well—and reap the benefits. France, on the other hand, has not integrated Maghreb Muslims well, many of whom languish in banlieues (poor suburban ghettos outside Paris, Lyon, and Marseille). Greece, Romania, and Hungary are examples of nations that are not integrated well with the rest of the EU in the first place, lack dynamic economies, and have a large unemployment problem of their own.
Of course, life is not all about economics. What about fears of migrants swamping, and possibly overtaking, Europe’s Christian and cultural heritage? This is indeed a long-term concern for any nation. But then consider:
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So far, only 6.3 percent of EU residents (around 32 million out of a total of 508 million) were born outside the EU.[2] (See Figure 2.) A few hundred thousand additional migrants are not going to bump that percentage up appreciably.
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Muslims (both native born and immigrants) comprise only 4 percent of the EU’s total population.[3][4]
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Fewer than 5 percent of Northern Europeans belong to a Christian congregation or claim affiliation with a Christian institution.
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Millions of completely assimilated children of US immigrants, like Senator Marco Rubio, strongly identify with their local culture. Rubio espouses conservative principles, quotes America’s founding fathers, and has been a staunch member of the Catholic, Mormon, and evangelical churches.