Argentine

Public policies could boost the contribution of immigrant workers to Argentina’s economy, says new ILO-OECD Development Centre report

 

Buenos Aires, 5 July 2018 - Argentina has a long history of immigration that continues to the present day. As immigrants represent less than 5% of the population, their role in the country’s economy is less pronounced than it was during the first half of the 20th century. A joint report by the OECD Development Centre and the International Labour Organisation (ILO), How Immigrants contribute to Argentina’s economy, provides new insights and makes policy recommendations to enhance immigrants’ contribution.

 

“Argentina’s effective immigration policies and its openness towards immigrants reflect an understanding of their positive contributions to the country. We hope that this evidence-based study will further support the country’s achievements and migrants’ integration.”, said Federico Bonaglia, Deputy Director of the OECD Development Centre while launching the report today in Buenos Aires.

 

The study provides an unprecedented analysis of immigrant workers’ contribution in three areas of the Argentina’s economy: labour markets, economic growth and public budget. It shows that the labour market outcomes of native-born and foreign-born workers are not very different. The labour force participation is almost equal, and the unemployment rate is just slightly lower among immigrants. However, they are more frequently informally employed and own-account workers, and on average earn less than the native-born.

 

The analysis also assesses whether the presence of foreign-born workers has benefited or harmed the employment opportunities of native-born Argentinean workers. It suggests that immigration is usually not associated with job losses or income declines among the Argentinian-born population. In fact, the labour income of native-born university graduates may even rise when there are more foreign-born university graduates. Also, more low-skilled native-born women may be able to join the labour force when more female immigrants from a number of Latin American countries live in their local area. Nevertheless, the report also notes that when there are more immigrants, a higher share of native-born workers appears to be own-account or contributing family workers and the labour incomes of low-skilled native-born workers may be lower.

 

The contribution of foreign-born workers is estimated at around 4% of GDP. This is above immigrants’ population share in urban areas, but below their share among labour force participants. Immigrants more frequently work in sectors where the average value added per worker is lower. They also have lower average educational attainments and lower wages.

                                                                    

According to the report, in 2013, the latest year for which data were available, immigrants made a positive net fiscal contribution under certain assumptions. Their average net fiscal contribution was equal to -1 to 2% of per-capita GDP. While this contribution was less than for the average native-born person, in part due to the disproportionally high share of elderly people among the immigrant population, it nonetheless shows that, at least for this sample year, immigrants did not represent a significant fiscal burden.

 

Although Argentina has not yet ratified ILO Convention C143 on the promotion of equal opportunities and treatment for migrant workers, the ILO Country Director in Argentina, Pedro Americo Furtado de Oliveira stated : "The wealth and sociocultural fabric of this country was constructed and continues to be strengthened by diverse waves of migration, probably because Argentina has a protective policy towards foreigners and provides the possibility of a dignified life with decent work.”

 

Policy recommendations

 

The report shows that the effects in terms of labour market outcomes for native-born workers, public finance and economic growth in Argentina are relatively limited. There is scope to further enhance the economic contribution of immigrants by improving existing policies, based on the following recommendations:

 

  • Pay more attention to integration gaps. The relatively high labour market integration of immigrants should not hide the fact that they may still be more vulnerable than the overall population. There is scope for intervention targeting the gaps in wages and in school performance between foreign and native-born individuals.
  • Create an attractive environment for high-skilled immigration. Individuals with higher educational levels make higher net fiscal contributions, and could have a greater positive impact on productivity. Far from hurting native-born university graduates, increasing the number of high-skilled immigrants might even boost their labour incomes.
  • Reduce informal employment. Policy interventions to reduce informal employment would be beneficial for the overall economy and would enhance the fiscal and labour contribution of immigrant and native-born workers alike.
  • Integrate migration into the planning of non-migration sectoral policies. A coherent policy agenda would help destination countries such as Argentina fully benefit from immigration.

 

 

Background information

In the early 20th century, the majority of Argentina’s immigrants came from Europe, but their numbers have since declined and Latin American immigrants have become proportionally more important. At the beginning of the new millennium, the country adopted an open immigration policy rooted in the principles of equality and universality.

 

Press contacts:

For more information or to obtain a copy of the report or request an interview, journalists are invited to contact:

 

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How immigrants contribute to Argentina’s economy is part of the joint International Labour Organisation - OECD Development Centre’s comparative project on Assessing the Economic Contribution of Labour Migration in Developing Countries as Countries of Destination that is co-financed by the European Union. The nine other countries covered by the project include: Costa Rica, Côte d’Ivoire, The Dominican Republic, Kyrgyzstan, Ghana, Nepal, Rwanda, South Africa and Thailand.

Find out more about the project: http://www.oecd.org/dev/migration-development/eclm.htm and http://www.ilo.org/eclm.

 

 

 

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