Introduction to Labor Migration
The world’s richest economies are clamoring for foreign workers, despite growing anti-immigration sentiment, particularly in the United States and Europe. However, a recent report reveals that labor migration is falling worldwide, even as aging societies face increasing shortages.
Decline in Labor Migration
The decline in labor migration began long before the re-election of Donald Trump, who ran on a promise to drastically curb immigration. According to the Organization for Economic Co-operation and Development (OECD), work-related migration to its 38 member states fell by more than a fifth (21%) last year.
Causes of the Decline
The OECD report notes that the decline was due less to demand than to increasing political opposition to immigration and stricter visa requirements in other advanced economies. Temporary labor migration continued to increase. The decline can be attributed to two countries: the United Kingdom and New Zealand.
United Kingdom and New Zealand
In New Zealand, the decline was linked to the end of a unique post-pandemic residency pathway that had allowed more than 200,000 temporary migrants and dependents to settle permanently. The country’s largest one-time residency program concluded in July 2022. After Brexit, the UK reformed the visa regime for health and care workers, tightened employer eligibility requirements, and banned family members from entering the country, leading to a significant decline in visa applications.
Impact on the Tech Sector
The US has introduced stricter caps on H-1B visas, the main program that allows foreign professionals in fields such as technology, engineering, and medicine to work in the country. Since then, the cost of visas for employers has increased significantly. Australia, meanwhile, increased salary thresholds for skilled worker visas, while Canada adjusted pathways for temporary workers, also contributing to the overall decline in work-related migration.
Strong Demand for Migrants in Europe
According to the International Monetary Fund (IMF), across the European Union, around two-thirds of jobs created between 2019 and 2023 were filled by non-EU citizens, underlining how dependent Europe has already become on migrant workers. There were 167.7 million migrant workers worldwide in 2022, representing 4.7% of the total global workforce.
Temporary Visas Instead of Permanent Visas
The OECD report shows that temporary or seasonal labor migration remained stable last year, even as permanent arrivals fell, reflecting governments’ preference for short-term programs that they can expand or contract at will. Seasonal and temporary workforce programs continue to be in demand in Australia, Europe, and North America, where employers in the agriculture, nursing, and construction sectors have filled gaps in their workforce.
Bureaucracy Keeps Migrants in Low-Skilled Jobs
The OECD not only called on advanced economies to attract more migrant workers but also urged them to focus on better integrating them into the labor market. The Club of Advanced Economies cited language training and access to social services as key requirements, as well as recognition of skills and qualifications to help foreign workers fully engage in their host countries. They are often employed in jobs that are much less skilled than the ones for which they were trained.
Conclusion
Policymakers are urged to create clearer pathways to transition temporary migrant workers to permanent status, to ensure their skills are fully utilized and to reduce labor shortages. While some politicians have spoken positively about the need for skills-based migration, their actions have been marked by efforts to eliminate those pathways, widening the gap between economic necessity and political will.
