The start to President Donald Trump’s administration has been nothing if not contentious. Nowhere has the friction been more obvious than in his push to remake US immigration policy. Trump’s position is clear: He views new immigrants, particularly those from specific parts of the world, as a threat to US security and economics. Although this position may seem like common sense on the surface, it does not reflect the economic reality behind it.
Many international news reports have already done a good job explaining how US crime statistics do not support the belief that certain immigrants are more dangerous than others. That’s not what I want to focus on. What I want to focus on is the economics of immigration. The truth is that most advanced countries, including the United States, are in the midst of a catastrophic shift in demographics. Birth rates have been declining for the last few decades and the number of retirees continues to rise, bolstered by ever-increasing life expectancies. This creates a situation in which fewer and fewer people are left working.
Workers are the driving engine of any economy. These people earn money, pay taxes, and spend. That spending becomes the money earned by other workers. Collectively, this recycling flow of money is frequently summarized as GDP. The example that most people point to when trying to describe a country with aging demographics is Japan. For the last three decades, Japan has witnessed a steady decrease in young workers and a concurrent increase in retirees. The net result? A stagnant GDP for the last 20 years.
European countries such as the UK and Germany are also in the midst of experiencing their own demographic shifts but with one key difference: Most have systematically encouraged a net increase of young workers through immigration. These new immigrants, usually without college degrees, are frequently siphoned through immigration programs into lower wage jobs, the kind of jobs that most native UK and German citizens are reluctant to do. These include construction work, seasonal harvesting of fruit, and service work at fast food restaurants. You will notice all of these jobs are still important if not essential, services that help maintain our current standards of living.
When unemployment rates get high, it is easy for the native citizens of a country, those who have lived in that country for their entire life, to look at immigrants as competitors. In some cases, immigrants are competitors. But more often than not, immigrants take on jobs that native workers don’t want anyway. This is no less true in Korea. A 30-minute drive to a large apple orchard or rice field in the country during harvest will quickly show a growing number of seasonal laborers, even in Korea, are foreigners. The sons and daughters of the owners of the orchard and fields usually are not interested in helping their parents or grandparents till the earth. This creates a void of labor that needs filing.
In the next 10years, nearly a quarter of Korea’s current working population will begin to enter retirement. This process will put more and more stress on social programs, particularly those providing health and retirement services. This stress will arise from two simple considerations: more people to support and less tax to pay for them. A simple mathematical calculation will tell anyone that the current system is not sustainable without changes.
Fortunately, the lessons learned about immigration in other countries have not gone unnoticed by the Korean government. The number of immigrant workers in Korea has more than tripled since 2000. If the economic logic holds, this trend should continue into the next two decades as an active component of policy to offset demographic catastrophe. Don’t be surprised, however, if political backlash eventually occurs, resulting in the election of Korea’s own Trump-like figure, eager to shut the borders.
By Justin Fendos
Justin Fendos holds a doctorate from Yale and a professor at Dongseo University in Busan. He is also the associate director of the Tan School of Genetics at Fudan University, Shanghai. – Ed.
