Spain hopeful of economy boost through immigrants

So far this year, over 42,000 undocumented migrants have arrived in Spain, marking a 59% increase compared to 2023. Most of these migrants have arrived via the perilous crossing to the Canary Islands. This surge has fueled a contentious political debate on immigration, reflecting similar tensions across Europe. In Spain, the debate is largely driven by the far-right Vox party, which often labels the phenomenon as an “invasion.”

In a conference room of a hotel near León in northern Spain, a group of Sub-Saharan African men engage in a lively game of bingo. While they share laughter and cheer as their numbers are called, many of these asylum seekers carry stories of profound hardship.

One of them is Michael, who fled Ghana to escape a violent conflict that claimed the lives of his sister and father. After a long journey through Morocco, he paid a smuggler to board an overcrowded inflatable boat that ultimately brought him to the Canary Islands.

“I was so happy because I knew that all my troubles, and the people trying to kill me, were behind me,” he says. “Once you are in Spain, you are safe.”

In Ghana, Michael had worked as a gas station attendant and a storekeeper, and he had also begun studying human resource management, a pursuit he hopes to continue in Spain once he settles down.

“Spain is one of the most respected countries in the world,” he says. “Being here is an opportunity for me.”

Currently, about 170 asylum seekers are staying at this hotel in Villaquilambre, which has been converted into a migrant center. They are part of the thousands who undertake the dangerous sea route from Africa to Spain each year.

However, these arrivals also highlight the potential for addressing Spain’s workforce challenges. Javier Díaz-Giménez, an economics professor at IESE business school and a pensions expert, notes that Spain’s aging population is creating a significant labor deficit. He explains that the “baby boom” generation, born between the mid-1950s and late 1970s, is now reaching retirement age, and the subsequent “baby crash” has left too few workers to replace them.

“The next 20 years are going to be critical, with more and more people retiring,” he says. “According to recent demographic estimates, 14.1 million people will retire during that period.”

One solution to this shortfall is to adopt an economic model similar to Japan’s, which relies heavily on technology to compensate for a low birth rate. The more obvious solution, he suggests, is immigration.

“If you want to grow GDP and pay pensions for all the retiring baby boomers, you need to approach it differently. There won’t be enough people unless we bring them in through immigration,” adds Díaz-Giménez.

Spain’s central bank estimates that the country will need around 25 million immigrants over the next 30 years to sustain its labor force. Prime Minister Pedro Sánchez has also emphasized the economic benefits of immigration, recently stating during a visit to Mauritania, Gambia, and Senegal that migrant workers contribute significantly to Spain’s economy and the sustainability of its social security system.

The government is currently considering a proposal to regularize the status of up to 500,000 undocumented migrants, primarily from Latin America. This would be Spain’s tenth mass regularization since becoming a democracy, the most recent occurring in 2005 under a Socialist-led administration.

However, economic needs clash with public sentiment. A recent poll reveals that 41% of Spaniards are “very worried” about immigration, making it their fifth-biggest concern after inflation, housing, inequality, and unemployment. While only 9% see immigrants as contributing to economic progress, 30% associate them with insecurity, and 57% believe there are too many immigrants in the country.

Villaquilambre, however, shows how undocumented migrants can successfully integrate into the workforce. Asylum seekers there are eligible to work six months after their arrival.

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