Money, Now + Beyond

3 significant ways refugees are helping the Italian economy thrive

It's not true that they are a burden to the economy. On the contrary, they may save it.

In 2016, over 176,000, asylum-seekers reached Italy’s shores. More than 76,873 migrants arrived in Italy since January, and more than 12,000 boats of migrants reached Italy over two days a few weeks ago.

In response, Italy is considering closing its harbors to humanitarian refugee rescue ships. But shouldn’t Italy welcome refugees instead?

From an ethical standpoint, the answer is obviously ‘yes’. Yet many worry that how high numbers refugees into the country will negatively affect the economy. On a recent visit to Italy, I asked a friend what his view on refugees was. ‘I am not in favor,’ he says. ‘We already have so much unemployment here: refugees just make things worse.’

Those who wish to welcome refugees often reply that one must welcome refugees for ethical reasons, even if that means threatening the economy.

Both sides of the debate have bought into the idea that refugees aren’t helpful to the economy, and debate the question of whether we should help them anyway. Yet, data show that refugees are not, in fact, a burden on the economy. Economy and ethics are pointing exactly in the same direction here.

1. Refugees are boosting the economy.

Studies by the Leone Montessa Foundation show that immigration is saving Italy’s finances. Refugees and immigrants might be unemployed in the very short term (who doesn’t need a moment to settle?) but they soon become a stimulus to the economy. In 2015, immigrants generated almost as much revenue as FIAT, Italy’s car manufacturing company, providing a net gain to the economy of 4 billion euros.

Studies by Prof. Alexander Betts, director of Oxford’s Refugee Studies Centre, show that the impact of refugees alone on the economy is either equivalent to or greater than the impact of other immigrants because of the high proportion of skilled workers among refugees.

2. Refugees are saving Italy’s welfare state.

Refugees are also saving Italy’s aging population. The country has the lowest birth-rate in the EU, and a high percentage of millennials moving abroad (I am one of them, actually). Asylum-seekers, on average, are young and provide new tax-paying workforce.

Taxpayers, for Italy, are vital. They subsidize pensions and public services. Bluntly put, the fact that Italy’s birth-rate is declining implies that the country needs refugees and immigrants to pay pensions of soon to be retired Italians.

Alas, upon arrival, refugees often get offered only illegal jobs. A Nigerian asylum-seeker friend tells me that when he first arrived in Italy he could only harvest tomatoes illegally: ‘I was paid 3 euros per cassone [a huge cassette, of half a meter cube capacity, nda]. When tomatoes weren’t abundant, it was difficult to fill even 3 cassoni a day.’

The irony is that by giving asylum-seekers legal and properly paid jobs, they would subsidize our pensions and welfare state even more. In 2015, more than 600,000 Italian citizens received their pensions thanks to migrants’ social security contributions. If most working migrants could work legally, these numbers would be even more substantial – probably in a significant way, given Italy’s tax-evasion problem.

3. Refugees can help Italians preserve workers’ rights.

Italy’s working-class won important victories in the 80s; decent minimum wage, holidays and social assistance, among other things. Will a workforce swollen by Italy’s refugee intake erode some of these successes?

Not necessarily, and certainly not because of refugees.

As we have seen, legal work by refugees and immigrants stimulates the economy and support Italy’s welfare state. It follows that under the right conditions, immigrants are a crucial component in sustaining, rather than dismantling, workers’ rights. Any future weakening of workers’ rights would be made despite the presence of refugees in the workforce, not because of it.

Those who plan to lower worker’s wages upon the arrival or refugees are scape-goating and exploiting them for the sake of their own profit. But these profits are at odds with the interests of everyone else: refugees’, other workers’, and the interest of any Italian who benefits from Italy’s welfare state.

But then refugees could become allies, rather than potential dangers, in the fight for the preservation of workers’ rights.

So what can be done to integrate refugees?

Betts emphasizes that when refugees have work opportunities, access to capital, and education, they also have the greatest economic impact. Long-term economic benefits partly rely on successful integration policies.

In Italy, integration currently relies mostly on local measures. Some are impressive.

Trento, my hometown, has the Welcome Project (Progetto Accoglienza). Social workers pair up mentally-ill people with asylum-seekers and give them a home to share. Nicola Pedergnana, who came up with the idea, tells me that ‘the results are just incredible. A refugee does not judge the person she takes care of. She befriends them.’ The project currently has a 90% success rate.  Trento University also has a project to give refugees access to higher education.

In the south, dying Italian towns are also coming back to life thanks to refugees. The town of Riace adopted this repopulation plan first. A third of its current citizens are immigrants, and the town is alive and thriving again. Refugees also stepped up to help rebuild post-earthquake towns like Amatrice (the hometown of pasta all’amatriciana).

For sure, these examples of integration are not enough. But at least they tell us that integration is possible, and making it happen worth it.