Migrants contributed 9.4% of global GDP: McKinsey report

India tops as the country of origin, contributing 16 million of the 247 million global migrants


From India, 8.2 million migrants have moved to the Gulf countries and Indians received the largest inflow of global remittances—$70 billion of the $580 billion generated in 2014.
From India, 8.2 million migrants have moved to the Gulf countries and Indians received the largest inflow of global remittances—$70 billion of the $580 billion generated in 2014.

New Delhi: Cross-border movement of people boosts global productivity and countries which prioritize integration of migrants stand to gain, said a report released by the McKinsey Global Institute on Thursday.

The economic and social impact of migration is a matter of heated political debate in developed nations.

According to the report—‘People on the move: Global Migration’s Impact and Opportunity’—more than 90% of the world’s 247 million cross-border migrants move voluntarily for economic reasons, contributing 40% to 80% of labour force growth in the top destination countries. The remaining 10% are refugees or asylum seekers.

Migrants contributed roughly $6.7 trillion or 9.4% of global GDP in 2015, about $3 trillion more than they would have added in their own countries. Most of these gains are concentrated in regions like North America and Western Europe, which together accounted for $4.8 trillion, the report said.

India tops as the country of origin of migrants, contributing 16 million of the 247 million migrants globally, while the US is the top destination with a migrant population of 47 million, data from the report shows.

From India, 8.2 million migrants have moved to the Gulf countries and Indians received the largest inflow of global remittances—$70 billion of the $580 billion generated in 2014, the report said.

While costs of managing entry are usually less than 0.2% of GDP across major destinations, the report said, migration does not harm native employment and wages, though there can be short-term negative effects. However, a study of the 18 major destination countries in the report revealed that not a single one of these countries has holistically addressed all the three aspects—economic, social and civic—of integrating migrants.

Immigrants, even though they earn higher wages by moving, earn 20-30% less than comparable native workers, the report said. It added that narrowing the wage gap to 5-10% would translate into higher global output.

“Making a clear improvement in the way immigrants integrate into destination countries—not only in terms of employment but also in areas such as education, housing, health, and community engagement—could add $800 billion to $1 trillion to the global economy annually,” the report said.

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