The Organization for Economic Cooperation and Development (OECD) has said that the high flows of immigration into rich countries are helping to strengthen markets and bolster growth.
The News International reports that the Paris-based organization said the high rate of migration inflows into its member countries, including the US, the UK, Canada, Spain, and Australia, last year helped loosen the tight labour markets and boost gross domestic product.
Clare Lombardelli, the body’s chief economist, said the US economy was looking “remarkably strong”, with increasing evidence of it pulling away from European economies. She said strong labour force numbers were part of the growth picture in the US and other economies. However, the large rate of migration definitely played a role in supporting growth.
Record levels of immigration to the UK, while being politically inflammable, have reduced labour shortages.
However, some economists are not impressed by the idea of any effect. “It is fair to say that immigration has probably played at least a modest supporting role in dampening wage pressures. But I don’t think it was the main factor in bringing down inflation even within the labour market – I would be inclined to say the re-entry of people who left during the pandemic was probably as big or bigger,” said Goldman Sachs chief US economist David Mericle.
