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The Economic Impact of Unauthorised Immigration: A Critical Cross-National Analysis of Fiscal, Labour Market, and Macroeconomic Dimensions

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  • Mdhlalose, Dickson

Abstract

This paper critically evaluates the economic effects of unauthorised immigration on host economies through a cross-national comparative lens, drawing on empirical evidence published between 2020 and 2026. The analysis examines twelve major host economies across four continents: the European Union (with detailed evidence from Germany, Italy, Spain, France, and Poland), the United Kingdom, the Russian Federation, Türkiye, the Gulf Cooperation Council states, South Africa, Malaysia, Thailand, India, Brazil, the United States, and Canada. Five questions structure the inquiry: the global magnitude and distribution of unauthorised migrant populations; fiscal contributions and costs across diverse institutional contexts; labour market impacts on native workers; sectoral concentrations; and macroeconomic effects, including projected consequences of large-scale removal. Synthesis of authoritative sources indicates that approximately 5.8 million unauthorised migrants reside in EU-27 member states, 2.9 million in the Russian Federation, 2.2 million in South Africa, 2.7 million in Malaysia, 2.4 million in Thailand, and 3.6 million Syrians remain under Temporary Protection in Türkiye (International Organization for Migration [IOM], 2025; Eurostat, 2025; United Nations High Commissioner for Refugees [UNHCR], 2025). The Organisation for Economic Cooperation and Development (OECD, 2025) estimates that the 2019-2024 immigration surge raised hostcountry potential gross domestic product (GDP) by an average of 1.4 percent across destination economies. The International Monetary Fund (Allen et al., 2024) projects that mass-removal scenarios in major host economies would reduce GDP by 1.8-6.2 percent over five years, with disproportionate impacts in agriculture, construction, and care sectors. Türkiye Statistical Institute (TÜİK, 2024) data indicate that Syrian-owned enterprises generated approximately US$2.3 billion in annual turnover by 2023. The paper argues that aggregate net economic benefits coexist with genuinely localised fiscal costs and distributional pressures on competing low-skill workers, and that policy responses should be calibrated accordingly. Recommendations include regularisation pathways, intensified employer-side labour-standards enforcement, targeted fiscal transfers to high-impact localities, and sectoral guest-worker reforms.

Suggested Citation

  • Mdhlalose, Dickson, 2026. "The Economic Impact of Unauthorised Immigration: A Critical Cross-National Analysis of Fiscal, Labour Market, and Macroeconomic Dimensions," EconStor Preprints 341746, ZBW - Leibniz Information Centre for Economics.
    • Handle: RePEc:zbw:esprep:341746
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    References listed on IDEAS

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    1. Courtney Brell & Christian Dustmann & Ian Preston, 2020. "The Labor Market Integration of Refugee Migrants in High-Income Countries," Journal of Economic Perspectives, American Economic Association, vol. 34(1), pages 94-121, Winter.
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    JEL classification:

    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts

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