Foreign workers fuel eurozone growth, European Central Bank reports

By Gokhan Ergocun

ISTANBUL (AA) - A surge in foreign workers has significantly boosted eurozone economic growth, helping to offset sluggish productivity and weak capital accumulation since the COVID-19 pandemic, according to a European Central Bank blog post published on Thursday.

The analysis highlights how increased labor force participation and a growing number of foreign workers have stabilized the region’s economy.

Despite a shrinking working-age population due to declining fertility rates, the eurozone’s labor force has nearly doubled its growth rate compared to pre-pandemic levels.

This is driven by higher participation rates among national workers and a substantial influx of foreign workers, who, despite comprising only 9% of the labor force in 2022, accounted for half of the labor force growth over the past three years, equivalent to 3.1 million additional workers.

Foreign workers have significantly contributed to gross domestic product growth by boosting employment rates and expanding the labor supply, particularly in tight labor markets, the 27-member bloc's monetary authority stated.