In 2016, after a surge in alarm about levels of immigration into Europe, the EU Commission invited several hundred researchers and policymakers to a three day event to consider what was known about migration and its policy implications. At the end, one leading figure concluded: “We all know what needs to be done, and we all know that it is politically impossible to do it”. Not a lot has changed. The gap between what voters will accept and what is needed is as wide as ever.
The UK immigration picture: a blip, not a trend
Political and media interest in immigration was in decline, but that has reversed with the publication of the most recent provisional migration figures from the Office of National Statistics (ONS). They showed 1.2 million immigrants arriving during the year, offset by 508,000 emigrating, producing a net figure of 672,000. Four countries – India, Nigeria, China and Pakistan – account for 40% of all immigrants.
This is probably not an indication of a trend. It is out of line with the longer term pattern, since it follows the exceptional disruptions of Covid, and events in Ukraine. Furthermore, in the past, peaks in immigration are usually followed a few years later by peaks in emigration. So the ONS predicts that within five years, the net figure will be down to 245,000, although the Oxford University Migration Observatory suggests it is more likely to be 330,000.
Who is really coming?
One paradox of immigration policy is that most people think that overall immigration is too high, but when asked about specific groups of people they usually exempt the groups who make up the majority of immigrants. They also typically have a very inaccurate picture of the actual nature of immigration. The chart shows the distribution of ‘immigrants’ by reason for coming.
Why do people want immigration reduced?
There are a number of reasons for popular hostility to immigration, some of them actively fed for political ends. They include a sense that:
- government has lost control. This is constantly evident in the political focus on “small boats”, although they represent a tiny proportion of all immigration;
- immigrants represent a drain on public services. In reality the average immigrant contributes more in taxes to the economy than the average British born citizen. Over 90% of those admitted on work visas are economically active taxpayers, compared to 62% of the native population;
- the infrastructure of housing, surgeries, schools etc. cannot support more people. There is no doubt that these are under pressure, but this is a matter of political choices. Immigrants bring economic growth: government chooses not to invest the proceeds in those services;
- immigrants bring social and cultural values which are inconsistent with ‘British values’. Some of these objections are rooted in failures of integration policies, though others are rooted in racism, and especially Islamophobia.
A critical issue has been geographical. Hostility to increased immigration is highest in areas with lowest levels of diversity. The economic benefits of migration are not necessarily felt in the places where levels are highest. The impact of a large influx of seasonal workers into a small rural community in Lincolnshire is much greater than the impact of the same number of IT specialists into London.
Too few workers: too many pensioners
We are living longer, but having fewer children. So among the British-born population, the proportion of retired people is growing, while the proportion of working age is shrinking. Without major improvements in productivity, a shrinking workforce will inevitably produce less wealth to sustain that retired population.
In practice, however, over recent years, the average age of the population has remained stable. This is almost entirely thanks to a steady inflow of relatively young immigrants, who have decades of working life ahead of them. The same pattern can be seen in the USA, where economic growth has again been driven by immigration. The reverse can be seen in Japan, which has the most closed approach to immigration, and has experienced decades of economic stagnation.
Most ‘immigrants’ are students
By far the largest number (40%) of people classified as “immigrants” are overseas students. In 2021, there were 680,000, making them a quarter of the UK’s university student population.
It has sometimes been proposed that students should be excluded from the immigration totals, since most do not stay in the long term. Eighty percent return home within 8 years.
There are at least three reasons why it would be a mistake to reduce these numbers. The first is economic: higher education is one of our most successful export industries. The net contribution of overseas students to the UK economy, in fees, living expenditure and visitors, is £38 billion a year (2.1% of the UK’s GDP).
They also sustain our higher education system, since their fees form 20% of the income of the average university, and nearly a third in some. Many universities and courses would not be viable without them.
They are also important to Britain’s ‘soft power’. Well-treated, overseas students go home after graduation with positive views of the UK, its culture and values, and with networks of friends and contacts which help build future business relationships.
Finally, those who choose to stay, for postgraduate study, research and employment, contribute to the growth of our high-skilled economy. The proportion doing this has been increasing, with nearly half of all those on study visas now also working.
Policies which discourage overseas students from putting down roots here are actively encouraging highly skilled people to leave the country. Hardly a positive economic outcome.
The second largest group are workers
Work is the second largest reason for immigration. It accounts for a third of all immigrants. It is ironic that many people voted for Brexit because they wanted to reduce immigration, especially by people of different cultural backgrounds. The actual result has been to replace largely white European workers with largely black and brown people from Asia and Africa.
Historically, only a quarter of those coming for work have stayed more than eight years, but since the barriers to entry became more restrictive, staying on rates have risen to more than half.
The reason the numbers are large is plain: we are short of workers, both in total and especially in some specific jobs. In 2022 the number of vacancies exceeded the number of people unemployed for the first time on record. The sectors with the highest levels of vacancies are hospitality, health and social care, and professional and scientific services.
Government policy has been to discourage the employment of low paid immigrants, who are believed to be open to exploitation and undercut local pay rates. Accordingly, the latest proposals are that the earnings threshold for work visas will be raised dramatically, to £38,700. Because of shortages, workers in health, social care and education are exempt from this requirement. However, health and social care workers will no longer be able to bring dependents with them. They also propose to raise the family income requirements.
Before Brexit, UK employers effectively had access to a labour market of 250 million, any of whom could come here and work with no more administrative requirements than British workers. Now they must apply for visas, and prove earnings levels. They may also face barriers to bringing their families. Post Brexit, the immediately available labour market for employers has shrunk to only £34 million.
It is also ironic that a party which used to espouse the virtues of the free market and shrinking the state, has produced a policy where the labour market is being managed by a state bureaucracy, classifying jobs, trying to second guess the needs of the labour market, and administer visas.
About a quarter of all immigrants are admitted on humanitarian grounds of some kind, and most people believe that we should accept people in genuine need (though they do not all agree about how to define that). Nineteen percent of total immigration comes through the special schemes for Ukraine, Hong Kong, and Afghanistan. A further 6% are people who arrive and successfully apply for asylum. Although they are a very small proportion of the total, those seeking asylum get disproportionate attention because, in the absence of any safe routes to seek asylum, they typically arrive in very visible small boats, and politicians have sought to make them a cause célèbre.
Do we want families?
One concern has been that while healthy young people can make a clear contribution to the economy, the benefits are less clear if they bring dependents, who may not be economically active, and make demands on health and education services. So policies sometimes seek to discourage or block family reunion, as is the case in the new proposals for the health and social care visa. However, OBR figures show the proportion of dependents economically active has been rising steadily, to near the average rate for the population as a whole.
Apart from the ethics of a policy which seeks to separate families for long periods, this must make working here less attractive.
Seven years ago European experts agreed that we know what to do, but that it is politically impossible to do it. Sadly, it looks as if nothing has changed. People continue to believe that in some nebulous way immigration is a bad thing. The reverse is true, but politicians remain determined to promote policies which are against our interests. It is not good for our economy, nor for people.