Immigration boosts Germany’s economy

A new study has revealed the positive effect immigration has had on Germany's economic success, particularly in highly-skilled positions. [SLU Madrid/ Flickr]

Fear and anger aren’t just election-winning tools in the United States. In Germany too, the increasing popularity of right-wing parties shows that fears about crime and job losses as a result of immigration are finding fertile ground. EURACTIV Germany reports.

Germany is riding somewhat of a wave at the moment. In 2016, government revenues were higher than its expenditures for the third year in a row. Despite the shock of the UK’s decision to leave the EU, GDP remained stable and state spending rose by 4.2%.

So why are these fears still able to take hold? A representative study by Movinga shows that foreign workers in Germany significantly contribute to the Bundesrepublik’s prosperity.

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An analysis of all 16 German states showed that those Bundesländer with a high proportion of foreign workers have lower unemployment and higher levels of risk capital investment. Significantly more patents are filed too. Conclusion: immigrants have a positive effect on the German economy.

Based on data from the OECD and the German statistics office (Destatis), the study shows that Germany’s cultural diversity is one of the contributing factors to its economic success.

Immigrants make up 9.6% of the population and one in five Germans has a migration background. The fact that Germany’s immigration rate is so high only tells half the story though. It is the proportion of foreign specialists in Germany’s key industries that really drives home the importance of immigration. According to the study, the numbers are higher than previously thought.

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By comparing key indicators for innovation and economic prosperity (including companies with risk-capital investment, patent applications and unemployment) with the number of migrants, the study concluded that relatively poor performing Bundesländer, with fewer foreign workers, could positively influence innovation and economic success by attracting talented personnel from abroad.

“The impressive number of companies with risk capital and the number of patent applications in multi-cultural regions like Berlin, Bavaria and Baden-Württemberg show that immigration positively affects innovation and growth,” insisted Movinga chief Finn Age Hänsel.