A new study reveals that wealthy nations with the highest immigration rates over the past 35 years have reaped substantial economic benefits, and many could still absorb more workers. The research, to be presented at a top European Central Bank conference next week, counters political tensions that have risen as far-right, anti-immigrant parties gain ground in countries like the US, Germany, and Britain.
Study Details and Key Findings
The study, led by University of California, Davis professor Giovanni Peri, examined data from dozens of rich countries in the Organisation for Economic Co-operation and Development (OECD). It found that growth and productivity were both likely boosted sharply by the influx of immigrants, most of whom were highly skilled, despite any political claims to the contrary.
“Receiving countries' labour productivity grew significantly during and after periods of higher immigration rates,” the paper states. “The predictive coefficients are often significant, economically large and a significant portion of such growth in GDP per worker is realized through strong growth in investments.”
Quantitative Impact on GDP per Worker
The total number of immigrants arriving in OECD countries from outside the bloc increased to about 100 million in 2024 from about 25 million in 1990, while native population growth turned negative in many countries. Peri and his co-authors found that an increase of immigrants equal to 1% of a country's population is associated with an increase in growth of GDP per worker of 1.2% within five years and 1.9% over 10 years.
Relevance to the European Union
The findings are especially relevant for the European Union, where the natural change of population has been negative since 2015 and the drop accelerated after the COVID-19 pandemic. The study concluded that as much as one third of economic growth per worker in countries including Spain, Italy, or Britain may have been generated by immigration between 1990 and 2024.
In Spain, the share of immigrants increased by 15 percentage points of the adult population from 1990 to 2024, a change that could result in a 28% higher growth of GDP per worker. The paper will be presented at the ECB Forum on Central Banking in Sintra.
