Is the uk’ s im­mi­gra­tion stance se­verely flawed?

Belfast Telegraph - Business Telegraph - - Front Page - by paul mac flynn, se­nior econ­o­mist at neri

Paul mac flynn writes that the brexit vote was in­flu­enced by con­cerns over im­mi­gra­tion but he agrees with john Simpson that ni busi­ness will suf­fer

Over the last num­ber of weeks there has been in­creas­ing dis­cus­sion over what the United King­dom’s im­mi­gra­tion pol­icy will be once it leaves the Euro­pean Union.

De­spite play­ing a dis­pro­por­tion­ately large role in the de­bate at the time of the ref­er­en­dum, the is­sue of im­mi­gra­tion has since taken a back seat to the more mun­dane tech­ni­cal­i­ties and me­chan­ics of trade pol­icy.

What we do know is that the cur­rent Govern­ment’s plan is to end free­dom of move­ment.

When taken in iso­la­tion, such a sim­ple state­ment can sound rather alarm­ing. It is quite im­por­tant to de­con­struct what this state­ment means.

We are told by the Govern­ment that in fact it means that the rights cur­rently en­joyed by EU na­tion­als to live and work in the UK will come to an end.

Con­se­quently, that im­plies that the rights of UK cit­i­zens to those same priv­i­leges within the EU will also come to an end.

The Govern­ment also stresses that it in­tends to guar­an­tee the rights of those EU na­tion­als al­ready within the UK, although such plans have been ac­com­pa­nied by very lit­tle de­tail.

More­over, we are as­sured that Ir­ish cit­i­zens will con­tinue en­joy the right to live and work in the UK, guar­an­teed un­der the Com­mon Travel Area.

What do these pol­icy as­ser­tions mean for the fu­ture?

Well, since the Con­ser­va­tive Party con­fer­ence ear­lier this month, the Govern­ment has gone fur­ther and said that EU na­tion­als will no longer be given pref­er­en­tial treat­ment for im­mi­gra­tion purposes.

Some­one from France wish­ing to come and work in the UK will be treated the same as some­one com­ing from In­dia.

It is worth point­ing out that im­mi­gra­tion from the EU has had a pos­i­tive im­pact on the North­ern Ir­ish econ­omy.

Peo­ple in North­ern Ire­land who were born in other EU coun­tries are much more likely to be eco­nom­i­cally ac­tive, in work and to be more highly skilled.

They are also younger, so they are more likely to be pay­ing taxes and less likely to be us­ing pub­lic ser­vices. One could say that end­ing pref­er­en­tial treat­ment for EU ar­rivals could en­able a more open and ef­fi­cient im­mi­gra­tion pol­icy, but that does not ap­pear to be the cur­rent pol­icy tra­jec­tory.

The UK Govern­ment has now sig­nalled that it is its in­ten­tion to end “low-skilled im­mi­gra­tion” and to favour more highly skilled im­mi­grants.

How­ever, there are sev­eral prob­lems with this as­ser­tion. Firstly, if you think about it, what the UK Govern­ment is essen­tially say­ing is that it’s okay for for­eign na­tion­als to come here and work in high-skilled jobs so long as we keep low-skilled jobs for UK na­tion­als.

This seems like an odd am­bi­tion to have for the UK work­force, but the more se­ri­ous prob­lem lies with how the Govern­ment has come to de­fine skills. It hasn’t talked about re­strict­ing en­try to univer­sity grad­u­ates or a sys­tem which favours those with reg­is­tered trade qual­i­fi­ca­tions.

In­stead, it has sought to de­fine skill level by how much the job that you get pays.

Once again, there are sev­eral prob­lems with this pro­posal.

Firstly, what might be de­fined as a low wage in Lon­don could eas­ily be de­fined as a medium to high wage in North­ern Ire­land.

Such ar­bi­trary tar­get­ing could have quite dif­fer­ent im­pacts re­gion­ally.

Se­condly, it is quite a leap to sug­gest that wages in the econ­omy ad­e­quately re­ward the skill level of the job be­ing done or, in­deed, the skill level of those do­ing the job.

In so many cases, we as­sume that if a job is low-paid, it must be low-skilled.

The care sec­tor is of­ten cited as one of the ar­eas of the econ­omy most ex­posed to re­duc­tion in the num­ber of mi­grant work­ers.

Some peo­ple be­lieve, how­ever, that re­strict­ing im­mi­gra­tion is a way to boost wages in such a low-paid sec­tor.

This is a se­duc­tive no­tion, but a flawed one.

By this logic, if the num­bers of mi­grant work­ers are re­duced, the care sec­tor will be forced to of­fer higher wages to in­duce more UK na­tion­als to work in the sec­tor.

This in­cor­rectly as­sumes that any­one could do this job so long as you of­fer them enough money.

In re­al­ity, many of the low- est-paid jobs are highly skilled and most of us, my­self in­cluded, wouldn’t last five min­utes in these jobs.

The prob­lem is that the econ­omy just doesn’t seek to value those skills ap­pro­pri­ately.

It is also no co­in­ci­dence that the skills we choose not to value are usu­ally con­fined to jobs car­ried out pre­dom­i­nantly by women, with the care sec­tor as a case in point.

Rais­ing wages and valu­ing skills in these sec­tors is an im­por­tant is­sue and a con­stant strug­gle.

It will not be achieved by re­duc­ing the num­bers of peo­ple will­ing to work in the sec­tor.

It will be achieved by or­gan­is­ing the work­force so that it can bar­gain for it­self and make the econ­omy recog­nise its skills.

Fi­nally, the idea that im­mi­gra­tion pol­icy should set an ar­bi­trary limit for ei­ther skills or earn­ings is also highly sus­pect.

Im­mi­gra­tion is ben­e­fi­cial to an econ­omy, not least when there is a mis­match be­tween sup­ply and de­mand in the labour force.

Im­mi­gra­tion al­lows an ebb and flow which pre­vents the econ­omy from ex­pe­ri­enc­ing short­ages.

A sen­si­ble im­mi­gra­tion pol­icy al­lows for those gaps and mis­matches to be ame­lio­rated.

Ar­gu­ments about the pay of work­ers have never been more im­por­tant, but they are not an im­mi­gra­tion is­sue. In next week’s Econ­omy Watch, we hear from An­drew Webb of Baker Tilly Mooney Moore

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