This increases productivity through economies of scale. That is, production tends to become cheaper and more efficient as the quantity produced grows larger, due to greater specialization of labor and of capital, and more efficient use of capital. Some public facilities such as transportation infra-structure can be used more efficiently with a larger population. Newcomers also increase flexibility, because they are unusually mobile both geographically and occupationally. This flexibility is ever more important as economies must change rapidly to stay in tune with changes worldwide.
Immigration reduces the uncuttable social costs of the elderly.
More and more of the U. S. and Israeli populations are retired people, with a smaller proportion of adults in the labor force. New immigrants typically are just entering the prime of their work lives and tax-paying years. Immigration is the only feasible way to lighten the burden of the aging population. Immigration also reduces the uncuttable social costs of defense. The taxes paid by olim contribute to the defense budget, which should be considered reductions in others' taxation because the total cost of defense increases very little with an increase in population.