Immigration: its real impact on public finances, according to the OECD

While the debate on immigration is alive in France, the OECD publishes, on Thursday 28 October, a study dedicated to its “impact on the budget”. By calculating the ratio between the contributions paid by immigrants and the public expenditure of the state, the international organization estimates that the cost is in balance. And it can also be positive. “In all countries, the contribution of immigrants in the form of taxes and contributions exceeds the expenditure that countries devote to their social protection, health and education,” writes the OECD in this report which focuses on its 25 Member States for the period 2006-2018.

In France, for example, the net budget contribution of foreign-born people is 1.02% of GDP, therefore slightly in surplus, against an average of 1.56% for all countries. “What focuses the public debate, particularly in France, is the cost that immigration can represent in terms of social and health spending, etc. We show that this question should not obsess us, because when we do the math, we observe that the contribution it is positive as far as military spending and public debt are taken into account “, analyzes Jean-Christophe Dumont, head of the OECD Migration Division.

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In fact, if we take into account the defense budget and the repayment of public debt, which do not concern only immigrants but the entire population, the contribution becomes negative for France (-0.85%) as for the average of the 25 countries. taken into consideration (-0.16). “The impact on the immigrants’ budget is low”, sums up Ana Damas de Matos, author of the study, the first on the subject since 2013. “If we count everything the state spends on migrants, from healthcare to public lighting, going through the police and allowances, and how much they contribute, we will always find a difference in the net budget contribution between -1 and + 1% of GDP “, he explains.

These data “reflect the migratory history of each country”, the economist believes: “In countries where there has been a lot of recent and young immigration, we will have a more positive contribution, such as in Italy or Spain. And vice versa. France will it finds itself in an intermediate situation, with an increasingly elderly immigrant population.

A misunderstanding

There is “a misunderstanding between the individual situation of immigrants and the impact of their entire population,” estimates Lionel Ragot, professor of economics at the University of Paris-Nanterre, who had studied the impact budget for immigration himself. in France between 1979 and 2011 “Individually they are more unemployed, they receive more allowances, it is true. This is the shortcut that is often proposed to say that they cost a lot to France. Only that this individual result is offset by an age structure, with immigrants who are often in the world of work and who therefore contribute a lot “, he adds. Even Lionel Ragot, in his past work for Cepii (center for prospective studies and international information), had estimated this migratory impact between -0.5 and + 0.5% of GDP, or “almost zero”.

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Difficulty of entering the labor market

Today, according to the OECD, public spending on immigrants is lower than that of the rest of the population in areas such as old-age and survivors’ pensions, sickness, disability, education, health. On the contrary, they are stronger with regards to family, unemployment, social exclusion and housing. Overall, foreign-born people contribute 11% less than “natives” to the state budget.

Participation “weighed down” by poor integration into the labor market, with 56% of immigrants employed in France, decodes Jean-Christophe Dumont. The OECD then carried out a simulation: with an employment rate similar to the rest of the population, immigrants could generate an additional 0.2% of GDP for public finances, the largest in terms of budget contribution (…) it has been found in countries that have attracted large flows of migrants for work, particularly highly skilled migrants ”. “The contribution is positive, but it could be much more positive,” says Jean-Christophe Dumont. “Integration policy is not an expense, it must be seen as an investment. With a return on investment”.

>> Read also – Mayotte: France’s failures against illegal immigration

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