- Low-skilled Nigerians who immigrated to the US saw a 1,500% increase in their income.
- The gains achieved by low-skilled workers are higher when they moved from a society with high socioeconomic inequalities to a country with fewer inequalities and where the difference in wages between low- and high-skilled workers is lower
- This is a positive development as remittance inflows to Nigeria will increase.
According to data from the World Bank, low-skilled Nigerians who immigrated to the US saw a 1,500% increase in their income.
The World Development Report 2023: Migrants, Refugees, and Societies, which was published on Tuesday and made available online by the World Bank, covered this.
According to the report, those who migrated from low-income to high-income countries stood to benefit the most from their choice to migrate as well as the United States.
What the report stated
The report read,
- “The potential gains are highest for people who move from low- to high-income countries. The labor demand at the destination also shapes outcomes. Gains depend on migrants’ skills, gender, age, and language ability. Although the absolute gains are larger for high-skilled workers than for low-skilled workers, low-skilled workers experience a multifold increase in their income as well”.
- “For example, low-skilled Yemenis and Nigerians moving to the United States increase their earnings by about 15 times. The gains achieved by low-skilled workers are higher when they move from a society with high socioeconomic inequalities to a country with fewer inequalities and where the difference in wages between low- and high-skilled workers is lower.”
However, it was noted that income gains are sometimes partly offset by the financial costs of moving, especially for the low-skilled.
The report read,
- “Migrants incur a range of expenses before their departure, from the job information and job matching fees they pay to intermediary agents to the regulatory compliance or documentation fees (for a visa/ sponsorship, medical tests, and security clearance), transportation costs, and pre-departure training costs they must pay”
- “For low-skilled migration, these costs tend to be borne by the workers, thereby contravening the principles of fair recruitment. These costs tend to increase with the duration of contracts, and they limit the ability of many low-skilled workers to benefit from migration opportunities.”
Nigeria’s Contribution to the US Economy
According to the report, Nigeria is a major source and destination of migrants, with nearly 1.3 million immigrants calling the country home, yet, Nigerians are the highest-earning immigrants in the United States of America according to data.
This was implied by an American conservative commentator and political activist in that “Nigerian-Americans are the most successful ethnic group in the US”.
Also, the Migration Policy Institute in Washington states that they are also among the most educated immigrants in the United States, as 59% of Nigerians aged 25 and above have a bachelor’s degree or higher.
Nigerian immigrants tend to work in high-skilled jobs, with 54 percent working in management, business, science, and the arts, and the rest in low-skilled jobs, both of which have significant spending power.
As a result, Nigerians received $10.1 billion as diaspora remittance between January and June 2022.
This was corroborated by PricewaterhouseCoopers (PwC) report which projected that migrant remittances to Nigeria would reach increase by 2023.
As the World Bank predicts Nigeria’s population to rise to 791 million by the end of the century- making it the world’s second most populous country after India. It is uncertain whether this will result in additional migration.
The reason someone (not just low-skilled workers) emigrating from Nigeria to the US would experience a massive leap in (nominal) earnings is the massive exchange rate gap. Nonetheless, given the equally massive cost of living differences in both nations, such persons might actually be better off in Nigeria.
Meanwhile, suffice it to also point out that the Top 1% in the US owns over 38% of all wealth in the US, the income differential between low-earners and high-earners is probably the BIGGEST anywhere in the world. Personally, while in the US, I was earning more in a month on Wall Street than my secretary made the entire year.