FRANKFURT, Germany: Foreign workers have emerged as a critical force behind the euro zone’s economic growth since the pandemic, offsetting the impact of an aging workforce and low birth rates, according to a European Central Bank (ECB) study released this week.

Over the past three years, foreign workers accounted for half of the region’s labor force growth, easing labor shortages and increasingly filling higher-skilled positions as their education levels rise, the ECB said in a blog post authored by senior economists.

“The influx of foreign workers in recent years has secured a robust growth in the euro area labor force, which has somewhat offset the negative demographic trends,” the post stated.

The findings contrast with political narratives in several European countries, where anti-immigration sentiment has gained traction. However, the ECB emphasized that as the bloc’s population ages and birth rates remain low, foreign workers could be key to sustaining economic momentum.

Germany and Spain saw the most significant influx of foreign workers contributing to labor force growth, while France and the Netherlands also reported notable but smaller contributions. In contrast, Italy’s relatively low labor participation rate meant that domestic workers played a more significant role in driving economic activity, according to the ECB.

Despite the rise in foreign workers, unemployment among them has decreased, primarily due to higher education levels, the ECB added.