Positive Effects of Immigration Essay

In work 'Positive Effects of Immigration Essay' we will research the influence of immigration on the economical component of the UK. In today, world migration has become an increasingly foremost phenomenon across the developed world, as well as in the UK. Employment opportunities and educational opportunities are the significant reasons behind the migration of people in Great Britain. The essay will outline the effects of immigration on the labour market, GDP and productivity, dependency ratios, and fiscal and public service effects in the United Kingdom.

Initially, Immigration has an impact on productivity and GDP since it expands the numbers of workers in industries. There are a variety of processes through which migration might upgrade the GDP per capita and productivity. Both high and lower-skilled migrants can raise labour productivity. High-skilled migrants increase productivity through inventing new technological devices and low-skilled migrants can increase productivity through work share and labour speciality. According to Ottaviano et al, 1% growth in the focus of migrants in the labour markets contributes to 2% to 3% increase in labour productiveness. Jaumotte et al. state that, a 1% growth in the immigrant percentage of the adult population results in a 2 percent rise in GDP per capita and productivity. Peri and Sparber have drawn attention to the fact that low-skilled migration uplifts the earnings of native low-skilled employees. They believe that natives might have a convenience over foreign employees in positions requiring more communication-intensive activities and that immigration 'pushes' low-skilled natives into occupations requiring a higher intensity of such skills, raising the level of specialisation in the economy and therefore productivity, as seen by pay increases.

Another impact of immigration in the UK is dependency ratios. Net migration assists in the reduction of dependency ratios. Migrants provide a source of working-age people, which helps to reduce the retired-to-working-age population ratio. Pettinger reports that the ageing of the UK population over 65 was 18.2% in 2017 and this percentage is expected to rise to 20.7 percentage by 2027, expanding the dependency ratio (which corresponds to the portion of people out of work compared to those who could be economically active). This tendency has worrying suggestions in Great Britain, where forecasts show that medical assistance expenditure could almost double from 6.9% of GDP in the earlier 2020s to 12.6 percent by the mid-2060s due to statistics movement. Nevertheless, net migration aids to lower the dependency ratios and the ratio of retired to working persons and is expected to rise in the UK.

Lastly, Fiscal, and public service are other impacts caused by immigration in the United Kingdom. People migrating to the United Kingdom from the EU contribute more to the UK government than Non-EU migrants by paying the tax amount and making contributions toward public finances from their earnings that will ultimately help the government to boost its economy. In 201617, the average European migrant in the UK donated £2,300 more to the UK public fund than the average UK adult. In contrast, everyone among the adult born in the United Kingdom pay £70 less than the average, and each non-European migrant contributed approximately £800 less. Migrants who are well educated and equipped with different kinds of skills and knowledge will make more contributions than migrants who are uneducated with low skills. A study by Dustmann and Frattini (2014), shows that the total tax revenue from European migrants was £15 billion which demonstrates the 64 percent growth in tax payments more than the transfers received. However, the tax amount collected from migrants outside of the EU was around £5.2 billion which is 3% more amount into the system than they took out. The total tax collection between 2001 and 2011 from the total number of migrants in the UK is over £25 billion.

In conclusion, fiscal and public service effects, increase in GDP and productiveness, and Reduction in dependency ratios are the positive effects of immigration that helps to boost the economy of Great Britain.

References:

1. Dustmann and Frattini, ‘The Fiscal Effects of Immigration to the UK’, Economic Journal, Vol.124, Issue 580, pages F593, F643, 2014.
2. Portes, j. ‘The economic impacts to the UK’, VOX, 06042018.
3. Pettinger, T (2017) UK Economics Magazine
4. Ottaviano, G I, G Peri and G C Wright (2015), ‘Immigration, trade and productivity in services: evidence from UK firms’, NBER Working Paper No. w21200).
5. Jaumotte et al. (2016), ‘Impact of migration on income levels in advanced economic’, Spill over Task Force, IMF.
6. Barrett, D., ‘Immigration from outside the Europe cost£ 120 billion’, The telephone, 05112014 Retrieved from https:www.telegraph.co.uknewsuknewsimmigration11209234Immigration-from-outside-Europe-cost-120-billion.html