Low-skilled Nigerians in US boost earnings by 1,500% – Report

Nigerians who migrated to the United States recorded a significant increase in their earnings, a new report by the World Bank has said.

The report, “The World Development Report 2023: Migrants, Refugees, and Societies”, released on Tuesday, found that low-skilled workers who move from a society with high socioeconomic inequalities to a country with fewer inequalities and a lower wage gap between low and high-skilled workers earned higher earnings.

The report highlighted the success of Nigerian migrants in the US, where they have seen a 1,500% increase in their earnings.

Many Nigerians migrate to Canada, the U.S., and European countries, in search of greener pastures.

The World Bank report highlighted the potential benefits of migration for low-skilled workers.

“The potential gains are highest for people who move from low- to high-income countries. The labour demand at the destination also shapes outcomes. Gains depend on migrants’ skills, gender, age, and language ability,” the report said.

“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.

“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.”

The report said the socioeconomic conditions in the destination country can play a significant role in determining the success of the migrants.

The report also said the high costs associated with low-skilled migration, including fees paid to agents, transportation costs, and pre-departure training expenses, limit the ability of workers to benefit from migration opportunities and go against the principles of fair recruitment.

“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,” it said.

“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.”

Remittances

The report highlighted that households that receive remittances invest more in agrochemical materials, and thus their farms have larger yields in Nigeria.

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“Remittances reduce poverty even in households that do not receive them. Households that receive remittances increase their spending, which boosts local economic activity and the incomes of other households in the community. Spending from remittances creates local jobs in non-tradable sectors such as construction,” the report said.

It added that remittance inflows jumped by almost 10 times in one year and then declined in Nigeria, even though economic fundamentals suggest they should have increased steadily.