As migration hits record levels worldwide, a debate is building among economists over whether some industries are becoming too dependent on foreign labor.
Many business owners say that bringing in low-skilled foreign workers has become essential, as local populations age and labor forces shrink.
In rural Wisconsin, John Rosenow says it is impossible to find locals to work on his 1,000-acre dairy farm. He relies on 13 Mexican immigrants, up from eight to 10 a decade ago.
That has enabled him to avoid making costly investments in robots that can help milk cows, as some other dairy farmers have.
“We get really good people,” Rosenow says. With immigrant labor, “I’m pretty sure if I wanted to double employment, I could get it done within a week.”
To some economists, however, dependence on imported workers is approaching unhealthy levels in some places, stifling productivity growth and helping businesses delay the search for more sustainable solutions to labor shortages.
Those solutions could include bigger investments in automation, or more radical restructurings such as business closures, which are painful but may be necessary long-term, these economists say.
“Once industry is organized in a certain way and the structure encourages employers to recruit migrants, it can be very hard to turn back,” said Martin Ruhs, a professor of migration studies in Florence, Italy.
“In some cases, policymakers should ask, does it make sense?” said Ruhs, who is also a former member of the U.K. Migration Advisory Committee, which advises the British government on migration policy.
The debate is likely to heat up further as Western societies teeter closer to a demographic abyss. For the first time since World War II, the working-age population is shrinking across advanced economies.
The European Union’s working-age population will shrink by one-fifth through 2050, according to a recent report by German insurer Allianz. There are ways to offset that trend, such as encouraging older workers to delay retirement.
However, importing foreign labor is often the easiest option, given the supply of available workers in places such as Latin America or Africa.
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