Migration Helps to Reduce Poverty

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In the aftermath of the Europe migration crisis, BREXIT, and the US election, migration has become an even more topical issue. Those opposing migrants in their countries often resort to gross generalizations aimed to slander migration, such as how migrants take away local jobs, engage in criminal activities, and have a negative impact on the economy. However, quite the opposite is true, and a recent survey shows migration actually creates a win-win situation for both migrants and the destination countries.

In a recent survey, carried out by Rapid Asia on behalf of the International Labor Organization (ILO) and the International Organization for Migration (IOM), it was discovered that migrant workers still earn an average wage below national minimum wages. Nevertheless, migration still helps to reduce poverty. The survey was carried out with 1808 return migrants in ASEAN member states of Cambodia, Lao PDR, Myanmar, and Vietnam who had migrated to Thailand or Malaysia undertaking low skill labor.

At the time of the survey, the minimum wage in Thailand was 9000 Baht per month, or roughly USD300 per month. In Malaysia, depending on region, the minimum wage was 920-100 Ringgit per month, or about USD300 per month. The Sustainable Development Goals (SDG) indicator 8.5.1 looks at average monthly earnings of male and female migrants by work sector. The study showed that the average male migrant worker earned an average income of USD286 while working in Thailand or Malaysia, and for women it was lower at USD250, a difference of 14 percent. Many of the under-paid migrant workers are being exploited as cheap labor, which in turn helps to meet the ever-growing demand for cheap products and services in Thailand and Malaysia.

Average Monthly Earnings of Male and Female Migrants by Sector

(SDG Indicator 8.5.1)

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Still, intra-ASEAN migration is growing, with more and more men and women looking for job opportunities to build a better economic future for themselves and their families. The question is, does migration make them better off? And does migration help to lift people out of poverty? The SDG indicator 1.2.1 looks at the proportion of migrants that are below the international poverty line, set to USD1.90 per day at the time, equivalent to USD57 per month. Comparing the average salaries of return migrants before migration and upon return, it was found that their average wages increased in all four countries. While many migrants in Lao PDR and Myanmar remained below the poverty line, poverty reduction amongst migrants was more than 10 percent overall, and nearly 20 percent in Myanmar. Migrants from Vietnam fared considerably better, and nearly all migrants were able to escape absolute poverty upon return.

Proportion of Migrants Below the International Poverty Line

(SDG Indicator 1.2.1)

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These findings are encouraging, and while they should not be used to generalize other migrant groups than those actually surveyed, the results are very consistent with what is already known about migration and how it contributes to economies around the globe.

 

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About the Author: Daniel Lindgren is the Founder of Rapid Asia Co., Ltd., a management consultancy firm based in Bangkok that specializes in evaluations for programs, projects, social marketing campaigns and other social development initiatives. Learn more about our work on: www.rapid-asia.com.