Migration to Rich Economies Slows, Labor-Driven Numbers Take a Hit

PARIS, France — Migration flows into the world’s wealthy economies are slowing down, according to a report from the OECD released Monday. Although overall immigration numbers remain historically high, permanent migration to OECD countries decreased by 4% in 2024 after three years of significant growth.

Labour-driven migration, in particular, fell sharply by 21%. OECD Secretary-General Mathias Cormann stated that immigration plays a vital role in addressing labor shortages and bolstering the resilience of OECD economies. “Effective migration policies are needed to manage associated pressures on public services and facilitate labour market integration of new arrivals,” he noted.

Cormann emphasized the importance of addressing the large earnings gaps between immigrants and native-born workers. He underscored the need for streamlined assessment and recognition of foreign qualifications, as well as policies that promote language acquisition, job search, and skills development.

Despite the decline in labor-driven migration, the report indicates a continued rise in family and humanitarian migration, which has increased pressures on integration systems, even in countries accustomed to accepting high numbers of newcomers. Housing, education, and welfare services are among the areas feeling the strain.

Last year, around 6.2 million people settled in OECD member countries, about 15% higher than pre-pandemic levels. This shows that while work-related migration is down, other forms of migration are still on the rise.

A key finding in the report is the significant drop in work-related migration, a trend seen after years of rapid growth. The OECD noted that the number of individuals moving to member countries for work fell by 20% in 2024 compared to the previous year, totaling around 934,000. Factors such as softer labor-market conditions and stricter visa policies in countries like the UK have contributed to this decline.

In several important EU nations, including Germany and the Netherlands, labor migration has dipped below pre-pandemic levels. This suggests a potential slowdown in the boost to workforce growth from migration in the upcoming years, despite many immigrants continuing to excel in the job market. In some areas, the employment rate for immigrants even surpasses that of native workers.

The OECD has previously warned that as wealthy countries face rapidly aging populations, a decline in migrant influx could have significant consequences. Without a continued stream of migrants, member states may see their labor force contract by about 8% by 2060, leading to a median income growth slowdown to around 0.6% annually. Despite the shifting migration patterns, immigration remains essential for economic growth.