The robust economic growth historically driven by migration in countries like Canada, Australia, and the UK is facing challenges due to housing shortages.
While these nations have avoided recessions, per-capita GDP has declined, impacting living standards.
Thirteen developed economies experienced per-capita recessions at the end of 2023, primarily due to housing shortages and associated cost-of-living strains, despite other factors like job shifts and lower wages for new arrivals. This trend raises questions about the sustainability of migration-led growth.
However, the economic model isn’t entirely doomed. Countries like Australia and the UK have benefitted from migrant workers filling critical gaps in industries like hospitality and healthcare. Yet, there’s a delicate balance, as seen in Canada, where rapid population growth has strained resources, leading to declining standards of living.
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In response, Canada has scaled back its immigration targets, aiming to reduce the population of temporary foreign workers and international students.
This move is expected to slow population growth, addressing the strain on housing and infrastructure.
Meanwhile, migrants like Akanksha Biswas in Canada and Calvin Jurnatan in Australia have faced challenges, including high rent, low pay, and limited job opportunities, highlighting the realities of these economic shifts on individuals.
In the UK, similar housing affordability issues have led to political tensions, prompting calls for planning reforms and stricter immigration policies. The Labour party, in particular, has promised to tackle these issues ahead of an anticipated election victory.
The broader implication is clear: Without addressing housing shortages and infrastructure gaps, the benefits of immigration-led growth may not be sustainable, impacting both migrants and existing populations.
A comprehensive approach is needed to ensure economic growth benefits everyone.
