A Viewpoint article on "Aging Asia" published on Monday suggested policy solutions, but one obvious answer was left out - more open immigration.
Nicole Alpert
Friday, March 27, 2009
A Viewpoint article on "Aging Asia" published on Monday suggested policy solutions, but one obvious answer was left out - more open immigration.
Immigration increases a nation's economic growth. With increasing pressure on safety nets as a population increasingly ages, immigration aids in bearing the burden.
While an aging population should be celebrated as a success story for humankind, it poses new challenges to our existing policy paradigm and lifestyle.
Immigration can mitigate the negative consequences of demographic aging.
An aging population tends to scare policymakers. Massive socioeconomic shifts create social and political pressure on welfare/safety nets and, thus, there is a subsequent need to reorganize policy in health care, family, labor and so on.
Even with immigration, we cannot "escape" an aging population and its transformation of society - migrants age too - but open immigration policies will help us make these changes more comfortably.
A recent study by The Lion Rock Institute, "Open the Doors to Hard Working People," on the migration policies of Hong Kong, Singapore, Dubai and Shenzhen found that new labor is a necessary ingredient for economic growth.
In Dubai, an extreme example, it is worth noting that before the financial crisis, guest workers represented almost 90 percent of the total workforce.
Singapore's economy relied on foreign workers to a great extent as their domestic population was simply too small to support rapid economic growth.
In areas where the demographic challenges of an aging population exist, immigration is necessary for economies to operate and productivity to increase.
Those who migrate are usually workforce age, which assists in keeping up workforce growth and raises the general level of productivity of an economy. It is not only small city-states that benefit, large countries like Australia do as well: "The [Australian] government recognizes that the greatest gains to Australia come from young skilled migrants, and has shifted the balance of Australia's Migration Program" to reflect those gains.
While immigration has many challenges within itself, which are outside the scope of this article, there are solutions that address countries economic and political needs. The benefits of immigration are numerous, and it particularly addresses the demographic challenges of aging populations and increasing dependency ratios.
The Lion Rock study makes an important point: "For resource-poor city- states like Hong Kong, Singapore, Dubai and Shenzhen, human resources are probably the only resource that can render their economic growth sustainable."
The study fittingly quotes from French classical liberal Emile Levasseur: "As a free and unfettered commercial intercourse between two countries is advantageous to both, for by the exchange of their commodities the producer and the consumer are both benefited, so also must the unrestricted circulation of the human race be viewed in the more comprehensive and enlightened scope of the enormous benefits it confers upon the human race at large."
When faced with an aging population, we will need to rethink our views, both on immigration and an aging population - from that of a global nursing home to one of human progress and longevity - while changing policy to reflect the fresh needs of society.
In adjusting to our changing age structure, to be sure, the one policy to be kept at the forefront of the agenda is immigration.
Nicole Alpert is a research associate for The Lion Rock Institute, www.lionrockinstitute.org.
The full study can be found in the quarterly journal Best Practice.
