Friday, May 04, 2018

We need Immigrants

Within the next few decades, working-age adults will need to support double the number of elderly people than they do now, putting immense pressure on welfare systems and wiping out as much as 3% of potential economic output by 2050, the IMF said in its latest World Economic Outlook report which said advanced economies such as Britain, the US and Japan risk being overwhelmed by their ageing populations, and calls on them to throw open their borders to more migrant workers in response. The IMF said the current labour force participation rate, which estimates the number of people eligible for work who are in employment, could fall by as much as 5.5% on average across advanced economies over the next 30 years.

 The Office for Budget Responsibility, estimates healthcare spending in the UK will need to almost double from 6.9% of GDP in the early 2020s to 12.6% by the mid-2060s because of the demographic shift.

The Resolution Foundation thinktank estimates the public purse will be out of pocket by about £160bn by the mid-2060s as the number of people over 65 grows by almost a third, while the working age population is expected to only increase by about 2%.

More women and older workers alone may not be enough for economies to solve the problem. It said labour market participation would still eventually decline even if gender gaps are fully closed, and that it was also likely to remain below current levels even if more older people stay in work for longer.
“Unless technology delivers offsetting productivity gains, these findings highlight the need for many advanced economies to rethink immigration policies to boost their labor supply" the IMF said

No comments: