A note from the Institut Montaigne (1) published this Monday, August 28, highlights the paramount importance of immigration to France in the years to come, particularly from an economic point of view. With an aging population, the renewal of the workforce depends on it “, can we read in this study. A quantified inventory that rectifies some preconceived ideas about the real impact of immigration on the country’s economy.
5 mins
Interview with Ekrame Boubtane, lecturer authorized to direct research in economics at Clermont Auvergne University at CERDI and associate researcher at the Paris School of Economics.
RFI: This note from the Montaigne Institute emphasizes that immigration will be essential for France’s growth in the years to come. However, the impact of this immigration on the French economy is considered low. How do you explain it?
Ekrame Boubtane: Even if immigration has a low economic impact, that does not call into question the fact that it is essential for the economy. And this has been the case in France for a long time, even before the question of the decline in the working-age population arose. France is a country with a long history of migration. And as an economic powerhouse, the country has relied on immigration to meet its labor market needs since the 19th century. Immigration still represents a small share of the French population [10,3 % de la population en 2023, NDLR]which explains its low impact on the economy, but that does not prevent it from having greatly contributed to the economic development of the country.
On the other hand, certain sectors of the economy would not function without immigration. When we look at a sectoral breakdown of employment in France, we see that in certain occupations, a relatively large proportion of the employed population is an immigrant. These are often jobs in tension, more precarious, which are subject to the vagaries of the economic situation… Which makes them less attractive for non-immigrants.
Is the cost of immigration quantifiable? And how do you react to the theses taken up by the far right which evoke public spending of 50 billion euros in favor of immigrants in 2023?
It’s very easy to create controversy around immigration, whether you’re on the left or the right. There is a whole research theme that has been analyzing the fiscal impact of immigration in host countries for more than 30 years now. In reality, it already depends on what is meant by cost or benefit. The first point, when it comes to evaluating the effects of immigration on public finances, is to try to determine what share of public expenditure could be attributed to immigration and to what extent it contributes to public revenue. And it is a difficult exercise, because, in the national accounts, no distinction is made by category of population.
Immigrants arriving in a country have recourse to public services: school for their children, various social aids when their income from work does not allow them to reach a minimum standard of living in the country, etc. But at the same time, these immigrants work, consume, save and also contribute effectively to public revenues in a direct or indirect way. On the other hand, immigrants are mainly of working and childbearing age. The share of public family expenditure represents a relatively small share in our country. If, on the other hand, we look at pension expenditure, as immigrants tend to be young people of working age, they are net contributors. And what we can demonstrate is that for permanent immigrants, we have rather a positive effect on public finances, that is to say that revenue increases more than expenditure. So their contribution to national wealth is positive.
Moreover, the most serious work that has been done in this field is that carried out by the OECD, which clearly shows that when national defense expenditure is not taken into account, the contribution of immigration to the finances of France is rather positive [l’OCDE en 2021 estime que la contribution de l’immigration serait de +1,02 % du PIB en France, NDLR]. And immigrants’ contribution to public revenue more than offsets the public expenditures that are generated by immigration.
You also explain that immigration tends to have a positive effect on the average standard of living. How?
First of all, immigration makes it possible to increase employment, because immigrants are mainly of working age and this has the effect of supporting the growth of the active population, and consequently national production. As I said earlier, there are certain sectors of the economy that would not function without immigration and therefore we have complementary effects, which explains why we do indeed have this positive effect on the average standard of living. . It is a question of distribution of the added value and it also contributes to a reduction of inequalities.
Another important element is that immigrants are overrepresented in low-skilled occupations… but also high-skilled occupations which are characterized by high wages and which are also important for innovation and for economic growth.
Also to listenEconomy Today – Immigration Law: The Importance of Immigrant Workers
(1) Demography in France: consequences for the public action of tomorrowto read here.