Understanding the impact of migration on the labour market is key to designing efficient labour migration and integration policies. The impact of immigration on wages and employment depends on a variety of factors, such as the skills of immigrants, their concentration across regions, occupations and industries, as well as the local labour market conditions. The OECD provides comparative analysis of how immigrants contribute to the labour markets of member countries by analysing things like how immigrants are employed across different sectors, or their contribution to entrepreneurship and job creation, among others.
Economic impact of migration
Migration has a deep and wide-ranging impact on the economy. The OECD provides analysis on the different ways in which migrants affect the economies of both destination and origin countries, such as their contribution to public finances, to employment and job creation, as well as the impact that diaspora communities may have on the economic development of their origin countries.
Key messages
Whether immigrants are net contributors or a burden to the public finances is a key question within the public debate on migration. The OECD provides unique cross-country estimates of the net fiscal impact of immigrants to the public budget of member countries. The actual impact strongly depends on immigrants’ integration into the labour market, both regarding employment and salaries. Generally, immigrants are not taking up more benefits than the native-born.
Emigrants are often considered a loss for their country of origin but they can also play an important role in fostering trade and economic development, notably through the skills and contacts they have acquired abroad. Drawing on the potential of emigrants, however, necessitates maintaining links and pursuing policies adapted to their specific needs. For this, it is necessary to identify precisely where, when and why people have left and what their characteristics and skills are. The OECD provides a detailed database on the characteristics and labour market outcomes of immigrants by origin, and supports origin countries in harnessing the potential of their diasporas through country studies.
Context
Migrant employment
Immigrants make up a significant and increasing share of the workforce in OECD countries. In 2022, a little more than 15% of all workers were immigrants on average across OECD countries, reaching over 20% in nine of them. This share has been growing in recent years virtually everywhere. This share has been growing in recent years virtually everywhere, with only 13% of workers being migrants in 2015 on average.
Immigrants tend to be concentrated in certain sectors of activity, in which they account for much larger shares of employment. For example, immigrants account for over half of employees in accommodation and food services in OECD European countries and in the United States. This type of sectoral concentration declines the longer immigrants stay.
Migrant contribution to public finances
Measuring the fiscal impact of migration is challenging. The net fiscal impact presented here shows the estimated net fiscal contribution – that is, the amount of taxes and contributions that migrants pay compared to the benefits and public services they receive. Expressed in percent of GDP, the resulting net impact is generally small, with a few exceptions where countries have large immigrant populations, such as Switzerland and Luxembourg, where the net fiscal impact is large and positive.
