NCPA - National Center for Policy Analysis

Migration Could Stop Population Fall in Developed Countries

April 3, 2000

A new report from the United Nations makes the strongest argument yet for the free flow of immigration. The reason is that population growth is crashing throughout the industrialized world. This will slow economic growth and exacerbate already serious financing problems for old-age retirement programs.

According to the U.N., not one major country now has sufficient internal population growth to maintain itself.

  • Just to keep the population from falling, a nation needs a fertility rate of about 2.1 children per woman.
  • Among major countries, only the U.S. is even close at 1.99.
  • Italy's is the lowest at 1.2, followed by Germany at 1.3, Russia at 1.35 and Japan at 1.43.

In some cases, this results in dramatic population declines. With low birth rates and increasing longevity, the percentage of the population over age 65 will double in almost every major country and will actually triple in China. Therefore, there will be fewer prime age workers to support future retirees.

This will either impose an intolerable tax burden on future workers or force more of those over age 65 to remain in the labor force. In the U.S., the retirement age would have to rise to 74.3.

The U.N. study concludes that mass migration may be a better way to stabilize the worker/retiree ratio: the U.S. will need 600 million immigrants between now and 2050. Japan will need about the same, but Europe will need 1.4 billion immigrants over the next 50 years.

And a study in the prestigious Journal of Political Economy (Kjetil Storesletten, April 2000) finds that admitting 1.6 million new immigrants per year can maintain Social Security's solvency without any tax increases.

Source: Bruce Bartlett, senior fellow, National Center for Policy Analysis, April 3, 2000.


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