The flow of goods, services and people is much more complex that our politicians let on during elections. No one wants our manufactured goods but it seems our retirees are in high demand.
Developing Nations Lure Retirees, Raising Idea of 'Outsourcing' Boomers' Golden Years
November 14, 2005
Costa Ricans like to say theirs is the only country in Latin American, and perhaps the world, boasting a greater number of Americans -- as many as 20,000 retirees are here from the U.S. and Canada -- than the number of its own émigrés abroad. That may be a stretch, since it requires counting some of the 1.4 million tourists who come here each year, an average of 30,000 Americans on any given week. Yet it gets at an important economic phenomenon.
Thanks to a decades-old policy of offering tax incentives and other perks to attract English-speaking retirees, Costa Rica has pioneered what is fast becoming a popular economic-development tool for the small, largely impoverished nations of the Caribbean basin: importing a high-spending consumer class unencumbered by school-age children, with the expectation that their dollars will quickly follow.
In Costa Rica's case, retirees contribute significantly to the $1.4 billion a year in direct spending by Americans here, the government says. (It doesn't differentiate between retirees and long-term visitors.) The multiplier effects -- salaries in health care, construction, retail and other services -- could bring the total benefit to $4 billion, nearly 25% of Costa Rica's gross domestic product. Moreover, the retirement wave is synergistic: early pensionados invested in second careers -- running bed-and-breakfast hotels near the beach, or operating travel agencies -- which attracted more tourists and more retirees.
With the prospect of more than 30 million Americans starting to retire next year, many developing countries expect a windfall. Which raises the question: Should the U.S. "outsource" baby boomers' golden years?
Consider one cost of retirement: labor. The U.S. depends heavily on immigrants to serve retirees, in the many kinds of services they need. According to the 2000 Census, more than one million U.S. hospital, nursing-home and other health-care workers were born abroad; nearly 350,000 of them are immigrants from Mexico, Central America and the Caribbean. Sending U.S. retirees abroad represents one step toward closing that intractable labor gap.
