The rhetoric surrounding the “dangers of immigration” has long been a key tool for galvanizing political support, especially within Donald Trump’s Make America Great Again (MAGA) movement. As Trump prepares to begin his second term as President on January 20, the economic reality of the United States—and much of the developed world—compels a more nuanced approach to immigration, particularly legal and skilled immigration. This growing tension between political rhetoric and economic necessity is expected to define significant aspects of his new administration.
Already, Trump’s inner circle is engaged in heated debate on the topic. On one side is his principal advisor, tech billionaire Elon Musk, who champions the need for a robust influx of skilled immigrants to maintain the United States’ economic edge. On the other are hardliner immigration restrictionists, who continue to advocate for tightening immigration policies, citing cultural and economic concerns.
This clash is emblematic of a broader global issue: the intersection of aging populations, declining birth rates, and the need for innovative solutions to sustain economic growth in an era of “depopulation.”
The challenges facing the United States are not unique. Across the developed world, aging populations are straining economic systems, and fertility rates are failing to sustain population levels. The global working-age population is projected to decline sharply after 2070, with significant regional variations.
For instance, in 2023, only 20% of China’s population was aged 60 or older, but by 2100, this figure will soar to 52%. Similarly, Europe’s working-age population is expected to drop from 64% in 2022 to just 54.4% by 2100. Among the G7 nations, only Canada and the United States are projected to see increases in working-age populations by 2100, primarily due to immigration.
Other developed nations, such as Japan (-46%) and Italy (-52%), face catastrophic declines. These demographic shifts threaten to upend economies, strain healthcare and pension systems, and diminish global competitiveness.
Nicholas Eberstadt, a political scientist, warns that depopulation could profoundly reshape societies and economies. Writing in Foreign Affairs, Eberstadt notes that declining birth rates and aging populations will lead to fewer workers, entrepreneurs, and innovators, while increasing the burden on care systems. “Future government policy, regardless of its ambition, will not stave off depopulation,” he writes.
In this context, immigration emerges as a critical factor in maintaining economic vitality. Countries like Canada and the United States, which have historically relied on immigration to bolster their labor forces, continue to attract skilled workers. These immigrants not only fill gaps in the workforce but also bring innovation, energy, and dynamism to their adopted countries.
The U.S. semiconductor industry, for example, will require more than 160,000 engineers by 2032, according to a report by McKinsey & Company. Musk believes the actual number is likely double that estimate. He has repeatedly argued that there is a “permanent shortage of excellent engineering talent” in the United States, which poses a significant threat to Silicon Valley’s position as a global technology leader.
Despite its declining birth rate—currently at 1.67 births per woman, well below the replacement rate of 2.1—the United States has been successful in attracting young, highly-skilled workers from abroad. A survey by The Economist highlights the U.S., Canada, and Australia as the most desirable destinations for global talent.
“If there were no barriers to entry,” the survey states, “23 million graduates would move to America, 17 million to Canada, and nine million to Australia.” This reflects a stark contrast with countries like China and India, which are experiencing significant brain drain. For example, of the top 1,000 scorers on India’s elite engineering entrance exams, 36% migrate abroad, with many heading to the United States.
The U.S. has a unique advantage in its ability to attract STEM (science, technology, engineering, and mathematics) talent, which is crucial in addressing labor shortages in key industries like technology and healthcare. Musk’s advocacy for immigration aligns with this vision, as he believes that welcoming the “world’s best talent” is essential for maintaining America’s global leadership.
However, Musk’s stance has drawn sharp criticism from immigration restrictionists within Trump’s MAGA coalition. These critics argue that companies like Tesla and SpaceX should prioritize hiring American workers rather than relying on foreign talent.
Musk has countered these arguments, stating that his companies already hire Americans but face a critical shortage of skilled engineers. “If you force the world’s best talent to play for the other side,” Musk warns, “America will lose. End of story.”
His comments underscore the delicate balance Trump must strike between appeasing his political base and addressing the economic realities of a shrinking workforce.
Trump’s immigration policies during his first term focused heavily on border security and reducing illegal immigration. However, his second term may require a more sophisticated approach to skilled immigration, particularly as industries like technology, healthcare, and manufacturing grapple with labor shortages.
One potential flashpoint is the proposed removal of caps on green cards for highly-skilled workers, a policy championed by Indian-American venture capitalist Sriram Krishnan, who is expected to play a key advisory role in Trump’s administration. Krishnan argues that such reforms are necessary to attract the “best and brightest” to America, regardless of their country of origin.
Musk has endorsed Krishnan’s stance, emphasizing the importance of making America the destination of choice for top global talent. However, this approach is likely to face resistance from within Trump’s own party, where anti-immigration sentiment remains strong.
The debate over immigration in the United States is emblematic of broader global trends. Countries are increasingly competing for skilled workers, with some, like New Zealand, lowering visa restrictions to attract talent. Meanwhile, depopulation and declining fertility rates in countries like China, Japan, and much of Europe are reshaping the global workforce.
Technology and automation are likely to play a role in mitigating labor shortages, but they cannot fully replace the need for skilled workers. As such, immigration will remain a key strategy for sustaining economic growth in the decades to come.
