Implications of alternative economic growth scenarios for long-term trends in immigration and the autochthon-allochthon mix of the population

Miroslav Macura, University of Geneva

There is compelling evidence suggesting that many European economies will increasingly experience shortages of domestic labour in the coming decades. Nonetheless, it is difficult to imagine that Europe will abdicate the long-term global economic race in spite of the anticipated domestic labour constraint. If the abdication is not an option, then a rise in the numbers of foreign workers and, by implication in the numbers of their dependents is the only option. Therefore, the following questions arise. If European countries are to sustain economic growth, how large will be immigration flows required to relax the labour constraint? In addition, how significant will be shifts in the autochthone-allochthone mix of the national populations resulting from the flows? This paper attempts rough answers to these questions for Germany, France and Switzerland, countries with different recent histories of fertility and employment levels. The paper describes simulations prepared over five decades by means of a simple simulation model. The aim is not to portray how the economies and populations of the three countries can evolve through the middle of the century. Instead, it is to explore the orders of magnitude of net immigration flows and changes in the autochthone-allochthone mix arising from alternative economic growth patterns under the varying initial conditions. The results suggest that sustained economic growth at 2-3 per cent per annum through the middle of the century under the initial and postulated conditions presupposes immigration and a growing presence of the allochthones. The volume of immigration and the share of the allochthones critically depend on the assumed patterns of growth – a mix of employment and productivity growth – and the initial fertility and employment levels conditions. The paper presents and discusses results of 16 simulation scenarios and draws conclusions.