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Is Immigration the Solution to a Nationwide Labor Shortage?

OK Boomer, sure…the title of this article is intentionally provocative. Luckily, as the Baby Boomers slip into retirement, younger generations don’t have to worry quite so much about their thoughts on immigration. They do, however, need to worry about a hollowed-out workforce, though. And they’ll soon begin to worry about the tens of thousands of caretakers who don’t exist but will be very much needed as the Boomers enter their golden years. After all, demographers have long warned about an impending labor crisis, and ideas about how to deal are in short supply.

Luckily, the U.S. is not the first nation to weather this storm. Germany, too, has been troubled by a declining workforce and waning numbers willing to fill service positions. Their answer? Warning: this might come as a shock…immigration. The results have been resoundingly positive. According to a 2018 study, the German economy grew by an average 0.2% per year between 2011 and 2016, largely because newcomers to the country wanted to work—and spend their earnings—in their new home.

The same is true of the U.S., though immigration’s net benefit here has been obscured by the demonizing rhetoric of both the current and—let’s be honest—former administrations. Indeed, it took intervention by the Brits—specifically, researchers at Oxford University in collaboration with Citigroup—to demonstrate that without immigration, the U.S. economy would have grown at a rate 15% slower than it did between 1990 and 2014. Just imagination if, in those same years, we hadn’t deported upwards of 6.5 million new arrivals. I might not be writing this blog…but not because an immigrant had taken my job (look: proof).

At the University of Pennsylvania’s Wharton School, researchers have developed a simulator that demonstrates the economic danger of increasing deportations and the enormous potential benefit of welcoming more immigrants to the U.S. The long and short of it is that, without immigration, our economy plummets and a cascade of accompanying social ills follow, including a crisis of caretakers for the aging Baby Boomer population. Meanwhile, more immigrant-friendly nations will pull ahead, making it more difficult than ever for the U.S. to attract much-needed professional talent.

So, yes, immigration is the answer—or, at least, an answer—but not without a caveat. Germany’s success owes much to the country’s long history of apprenticeship training, allowing employers to create the workforce they need, and helping immigrants assimilate to their new home. Now, if only education were affordable in the U.S…

But, OK Boomer, we know. We won’t go there, at least not here and now.

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