[Economics] Record Immigration Collides With Housing Crisis

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Top Stories Chinese President Xi Jinping arrived in France to begin a three-nation swing through Europe to bolster ties, with stops in Hungary and Serbia. The euro zone is awaiting a vote of confidence from its own consumers, and a policymaker showed optimism at recent inflation data. The yen extended losses amid focus on Japan’s interest-rate outlook and after the US Treasury secretary urged caution in currency interventions. Housing in Crisis A widely covered surge in authorized and irregular migration into the US is set to shape November’s US presidential election.Yet for all the political rancor, those lofty immigration rates remain largely supportive for the economy, as we have recently written in this newsletter here and here. And the scale of the increase actually pales in comparison with other advanced economies where a migrant wave is colliding with a chronic shortage of homes to house them, undermining living standards. For every 1,000 residents, Canada brought in 32 people last year, versus fewer than 10 in the US. Put another way: Over the past two years, 2.4 million people arrived in Canada, more than New Mexico’s po[CENSORED]tion, yet Canada barely added enough housing for the residents of Albuquerque. Canada, Australia and UK Beat US in Annual Po[CENSORED]tion GrowthAnd it’s a similar story in the UK, Australia and New Zealand. In fact, as we explore in today’s BigTake, some thirteen economies across the developed world were in per-capita recessions at the end of last year, according to exclusive analysis by Bloomberg Economics. Advanced Economies Face Declining GDP Per CapitaThe upshot: Rising home prices, soaring rents, sticky inflation, and declining living standards. That’s a toxic cocktail for the electoral prospects of the UK’s Rishi Sunak, Canada’s Justin Trudeau and Australia’s Anthony Albanese. And the political reality is that the longer voters in the UK, Australia, Canada and similar economies see their living standards go backwards, the more their opposition to rapid immigration programs will harden.

https://www.bloomberg.com/news/newsletters/2024-05-06/world-economy-latest-record-immigration-collides-with-housing-crisis