Spain needs more and more migrants to keep economy going

by Lorraine Williamson
The economy in Spain needs digital workers

MADRID – With Spain’s current demographicsthe migratory flow is of great importance to the national economy. By 2050, between seven and eight million newcomers will be needed to support the pension system. And also to do the work the Spaniards are rejecting.

This is apparent from a calculation by the Spanish statistical office INE. In the past year, 202,000 inhabitants of Spain left the country, and about the same number of migrants came in their place. OECD data from 2020 show that 7 million migrants live in Spain, which is 15% of the entire population. These migrants are indispensable to compensate for the relatively low percentage of the labour force in Spain. 

Labour force shrinks 

According to director Emilio Ontiveros of Analistas Financieros Internacionales (AFI), Spain will have a major demographic problem within 2 decades. According to him, an increase in the birth rate and attracting new young talent is of high strategic priority for the country. If current predictions come true, the population will continue to decline, especially the number of young people. Immigration is therefore a necessary condition for the further development of the knowledge economy, the breeding ground for talent and innovation. 

Digital talent needs to be better distributed worldwide 

Globally, the demand for digital talent will only increase further, and so will the inequality between countries that have a lot and little digital talent. To combat this growing gap, the available talent will therefore have to be better distributed across the various countries. This means that migration flows are of crucial economic and emancipatory importance. 

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Migration à la carte 

In 2020, the migration flow within the OECD countries was the lowest since 2003, at 3.7 million migrants. On average, a migrant earns between 3 and 6 times as much in the country of destination as in the country of origin. This incentive appears to be insufficient to promote the spread of young talent. In addition, European countries are anxiously closing their borders to prevent an excessive flow of migrants. The need for migrants is there, but only for the group of highly educated newcomers who can fill specific jobs for which the labour supply is low, which amounts to “migration à la carte”. 

Demographic problem 

However, Spain will have to compensate for the current population composition. In 1998 the country still had 3.3 million inhabitants between the ages of 20 and 24; in 2018 there were only 2.2 million. This means that in 20 years the number of young people who usually study has decreased by more than a million, while this is the most important group for the development of digital talent. If it is up to the Spaniards themselves, this problem will only become more acute because the birth rate has been falling for years. In 2008, 520,000 children were born in Spain, compared to less than 282,000 from January to October 2021. 

Related post: Foreign migrants compensate for low birth rate in Spain

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