Migration
- The supply of labour for an economy is influenced by the net immigration
- If more people come into the country than leave, the labour force will increase in size
- This increase can:
- Overcome skill shortages
- Reduce the dependency ratio
- Increase government tax revenue
- Help the economy to expand without encountering inflation
- However, emigration can cause problems, as the labour force will suffer a contraction in supply (e.g. in Ghana, 3/4s of trained doctors emigrate)
- Immigration can disadvantage low paid workers, as some of the immigrants will be prepared to work for lower wages
- Immigration can therefore put downwards pressure on wages
- Immigration may also put pressure on public services such as the NHS, especially if they’re concentrated in a specific area.
- It is said that a lot of immigrants that work in low-skilled jobs are over-skilled for these, and may move onto more demanding occupations in the future
- They could, however, be working in the UK whilst they wait for economic prospects in their original country to improve.