Published on People Move

The financial crisis and immigration policy: how some developed countries are coping

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More restrictive immigration policies by developed country governments are being implemented as the financial crisis deepens. For example, the United Kingdom just published a bill which contains some of the following measures:

1) Migrants who are not citizens or permanent residents of the UK will not have access to full services benefits and social housing; and

2) Migrants will have to pay a levy towards schools, hospitals, and other local services so that that the new flows of UK immigrants do not put pressure on the community.

According to the UK Visa bureau, “the bill is part of the new Australian-style points –based system for immigrants introduced in stages last year, which aims to control UK immigration so that only those needed in the British economy move to the UK and no more.”

Australia may cut migrant visas as unemployment grows. In a recent interview, Australian Immigration Minister Chris Evans said that "the global financial crisis could lead to a smaller migrant intake in 2009, as demand for skilled migrants slowed."

Populations in some developed countries, mainly in the EU, have mixed feelings on the issue of migration. On the one hand, there is a felt need for immigrants to help with labor shortages, but on the other hand, the integration of asylum seekers and immigrants is perceived as creating a burden.  The concern that immigrants take jobs away from natives is exacerbated in times of high unemployment.

In Canada, however, Jason Kenney, the Minister for Immigration stated that the country "would maintain its current policy of encouraging immigration in order to meet identified labor shortages in key areas despite the financial crisis”.

Attracting different types of skills and talent are necessary for developed countries to compete in the global economy. Canada’s strategy of encouraging people to move to there is the best way to be ready once the crisis ends. Given the demographic changes expected over the next twenty years, developed countries need to attract talent, reduce skills gaps, and project the skills shortage for the next few years. This is the time to attract the best skills instead of reducing the intake of immigrants. 


Sonia Plaza

Senior Economist, Finance, Competitiveness and Innovation Global Practice, World Bank

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