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Labour migration is often mentioned as a way to mitigate the impact of ageing in wealthy societies. This article analyses the impact of labour migration on the welfare level and old-age dependency ratio of a prosperous ageing country, the Netherlands. If labour migrants are considered to be part of the population of the host country, they only contribute to a higher welfare level if their productivity is higher than per capita GDP. If they stay permanently and form a family, their productivity will need to be higher than the average labour productivity of the incumbent workforce. Labour migrants will mitigate the rise of the old-age dependency ratio, but only if they only stay in the host country temporarily. Therefore, only selective and temporary labour migration will relieve the ‘burden’ of an ageing society.
Paul de Beer (Mon,) studied this question.